TCS Daily

The Brain Gain

By Dominic Basulto - August 20, 2004 12:00 AM

This year's presidential campaign has already seen its fair share of discussion about the perils of IT outsourcing as well as sharp accusations about the thousands of U.S. jobs lost to skilled foreign IT professionals willing to accept positions at significantly lower pay rates. However, any debate over IT outsourcing and possible limits on H-1B visas for highly skilled technology workers should include a more thoughtful discussion of the enormous impact that immigrants -- and their children -- have played in the creation of U.S. technological superiority. Only by keeping its doors open to talented immigrants can the U.S. hope to maintain its competitive advantage over the nations of Southeast Asia.

Consider a new report from the National Foundation for American Policy (NFAP) called "The Multiplier Effect," which forcefully and cogently argues that U.S. economic and technological superiority benefits significantly from immigration. Over time, the children of these immigrants also contribute to U.S. technological know-how, creating an economic "multiplier effect." In short, an open policy toward the legal immigration of skilled IT professionals does not hinder long-term U.S. competitiveness -- it actually improves it.

The basic premise of the report is simple -- immigrants have played an important (but sometimes overlooked) role in the creation of a thriving U.S. high-tech sector that is second to none in the world. Without the continued influx of these talented immigrants, though, the nation's technological and scientific standing is at risk. After all, more than 50% of the engineers with doctorates working in the U.S and approximately 45% of computer science doctorates are foreign-born -- and these foreign-born engineers and scientists tend to out-perform their U.S. peers. So much so, in fact, that a 1997 National Academy of Sciences report analyzing recent winners of prestigious awards such as the Nobel Prize came to the following conclusion: "It is fairly clear that Americans with recent roots are over-represented in any classification of Americans who have brought honor and recognition to the United States."

More importantly, the report argues that the children of these immigrants are America's next superstars in areas ranging from biotech to semiconductors. According to Stuart Anderson, the author of the report and a former staff director of the Senate Immigration Subcommittee, foreign-born high school students recently comprised 50% of the 2004 U.S Math Olympiad's top scorers, 38% of the U.S. Physics Team and 25% of the Intel Science Talent Search finalists. With all likelihood, these emerging superstars will go on to productive careers in the sciences, mathematics or engineering. By some accounts, in fact, 60% of the top U.S. science students and 65% of the top math students are the children of immigrants.

Followers of the local Silicon Valley start-up scene would not be surprised by these findings. After all, companies such as Intel, Apple, Borland, Compaq, Computer Associates, Sun Microsystems and 3COM all owe their success to the hard work of foreign-born immigrants. Indeed, Sergey Brin, one of the co-founders of the $30 billion Google juggernaut, is the 30-year-old Russian-born son of a math professor. According to some estimates, nearly one-third of all Silicon Valley engineers are foreign-born, while one-third of the engineers at prestigious R&D labs (e.g. IBM, AT&T) are foreign-born.

Throughout Silicon Valley, in fact, there are hundreds -- if not thousands -- of young Indians, Russians, Vietnamese and Chinese who are starting new companies and developing new technologies that could pave the way for radically new sectors and industries within the next five to ten years. Young immigrant entrepreneurs will run the star companies of the next decade. Already, West Coast networking organizations like TiE (The Indus Entrepreneurs) and CINA (Chinese Information and Networking Association) specialize in providing networking opportunities for foreign-trained immigrants, while venture capital firms like Blue Water Capital in Virginia have set up funds that invest solely in companies run by first- or second-generation immigrants.

Going forward, it is easy to see what the policy implications of this "brain gain" are. In order to retain its technological superiority, the U.S. needs to encourage an open policy toward the immigration of professionals and students. In addition, policymakers should consider ways to boost science & math education within the U.S. and provide incentives for businesses to invest in long-term R&D initiatives. Innovation is the key to future U.S. economic greatness and immigrants arriving in the U.S. recognize this. Open labor markets help to strengthen the U.S. economy and provide the foundation for innovation in future generations. At a time when Silicon Valley is facing a labor shortage of skilled engineers and scientists, the need to embrace skilled immigrant IT professionals is all the more pressing.

Failure to understand these implications could result in a "reverse brain drain," in which the U.S. loses its best and brightest to nations in the developing world. If the rest of the world no longer views the U.S. as the home of innovation and open markets, foreign-born Americans will be free to vote with their feet and move elsewhere. A recent article in The Wall Street Journal ("Give Us Your Nerds") puts it best: "Any policy that would depress the influx or close off our borders altogether is not in America's long-term interest, especially in a world where economic growth and competitiveness will depend above all on human capital."


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