How Trump can solve the shortage of high-tech workers

This week, President Donald Trump signed an executive order to curb abuse of the H-1B foreign worker visa program. While H-1B visas were designed to fill a shortage of specialized PhDs and engineers, employers, predominantly in the tech industry, have instead used them to fill entry-level programming and software development jobs.

The rationale for the H-1B program is clear: if there aren’t enough qualified American workers for these positions, then to compete and innovate, companies should be able to import them from abroad. In practice, it hasn’t always worked out this way. That Trump has prioritized reducing abuse of the H-1B program is welcome news. But that only solves one part of the problem. Tough talk and punitive measures alone though won’t do anything to actually grow the pool of high-skilled American workers and connect more of them to the good paying jobs tech can offer.

Is it possible to kill two birds with one stone—to help companies fill critical skills needs today while also getting them to invest in developing homegrown talent? Maybe so, through a more ambitious reform of the H-1B program that ties it to creating more apprenticeships. A fuller solution would leverage companies’ interest in H1B visas to encourage employers to invest in the skills of American workers, and pull their weight to build a globally competitive domestic workforce. If he handles it right, Trump could accomplish an elusive win-win for American workers and employers.

Designed in the 1990s to help companies fill high skill workforce shortages, the H-1B program provides more than 65,000 visas each year to tech employers. The application period opened this year on April 3rd and in a mere four days the annual visa cap for the year had been hit, selected by lottery from among 199,000 applications received during that four-day window. Employers need only pay workers a minimum of $60,000 a year—a good distance from the going market rate especially on the tech saturated hubs on the coasts. This low salary baseline not only disadvantages American workers who demand a higher salary, but it also discourages employers from doing what they are supposed to do when skills are scarce: invest in training.

In many industries, when employers cannot find qualified workers, they raise salaries or partner with local schools or non-profit organizations to train workers for those positions. For technology jobs, however, where the competition is particularly fierce, salary wars and poaching among a limited pool of current talent is the norm, and educating the next generation takes time since employers still overwhelmingly choose to recruit from four-year colleges. Against that backdrop, the H-1B program was designed to serve as a stopgap, but never to be a long-term skills solution for employers or the country.

The U.S, however, continues to struggle to build a robust domestic pipeline of tech talent to fill today’s tech jobs. For that reason, the Trump administration and lawmakers in Congress on both sides of the aisle support expanding tech apprenticeship programs, a time-tested workforce strategy undergoing a renaissance in the U.S. With big unmet demand for specialized skills, and a willingness to embrace new education models beyond the traditional college, the tech industry is ripe ground for expanding apprenticeship. There’s also some recent and visible interest among tech sector leaders, with Salesforce CEO Marc Benioff just weeks ago challenging the president to accept a moonshot goal of five million apprentices in five years.

Despite recent interest, tech apprenticeships in the U.S. have yet to take off. Of the roughly half million apprentices in the U.S. today, a growing but still small portion of them are in the tech sector. Why the lack of uptake? First, apprenticeship means a big culture change for tech, including recruiting more diverse talent from more diverse places than the industry is accustomed. Second, apprenticeship isn’t a free ride and demands employer investment. You can’t have more apprentices without employers willing to hire and train them. That’s a challenge for tech employers used to dynamic workforce, knowing well the risks of losing the apprentice they invested in to someone across town. In recent years the Obama administration, Congress and governors across the country have used public dollars to incent more employers to invest in apprenticeship and defray some of their costs and risks. But those much-needed resources for apprenticeship remain modest and cannot transform the way tech sources talent alone.

This is where the Trump administration has the chance to finally tackle tech’s skills challenge. But the president has to look beyond the current executive order, which simply directs specific agencies to recommend reforms to combat abuse. Cracking down on misuse of H-1B won’t be enough to help more Americans tap into the tech boom, unless they also have the skills to fill those jobs. Instead, Trump should recognize that tech employers have a responsibility to invest and train the workforce they need both today and tomorrow. He can work with Congress to leverage the H-1B program to encourage companies to undertake such efforts.

What would those reforms look like?

It starts with raising the fees that employers already pay today to bring in H-1B workers from abroad. Today’s fees, which range between $1,200 and $6,500 per worker, are too low to meaningfully incent employers to give a first look at H-1B alternatives like apprenticeship. Higher fees could nudge more tech employers to forego H-1B and instead invest in homegrown talent through apprenticeship.

For employers that still choose to pay the higher H-1B fees, those funds can be used to expand tech apprenticeships. In fact, a portion of H-1B fees already support grants to public-private partnerships that train American workers for in-demand jobs. Higher fees would expand this pot of money and could be dedicated to fuel apprenticeship expansion in tech.

In fact, Trump already has a model to look at for how this can work. Seeded with a H-1B grant in 2015, Washington-based Apprenti works with employers across the tech sector to start apprenticeship programs that fill entry-level IT jobs that mirror the top H-1B occupations. Apprenti makes it easier for employers to start an apprenticeship, and as a result is diversifying the tech workforce by connecting American women, minorities and veterans to good-paying tech jobs.

More resources to support organizations like Apprenti could also be complemented by new H-1B program requirements to help wean employers off H-1B over the long-term. As a precondition for H-1B eligibility for entry level IT occupations, policymakers could require employers to sponsor an apprenticeship program or partner with organizations like Apprenti. Or, since employer demand each year for H-1B visas far exceeds the 65,000 plus cap, policymakers could create an H-1B visa priority line for the employers that do.

Rather than focusing exclusively on cracking down on bad actors, H-1B reform should present apprenticeship as a viable and sustainable workforce alternative to fill entry-level tech jobs. Such reforms should not choke off America’s access to global talent nor keep us from retaining the talent educated here in our colleges and universities. In a fair and open system, we should have the confidence that American workers can compete and succeed. But to succeed, American workers need a fair shot, and to ensure that, Trump also needs to focus on strategies that invest in the American people and their skills. More tech apprenticeship is a proven way to get there, and Trump should not miss the H-1B opportunity to ignite a boom that could benefit American workers and employers for years to come.

Brent Parton is the Deputy Director of the Center on Education and Skills at New America and a former Senior Policy Advisor at the U.S. Department of Labor.


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