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Education and Training Funded by the H-1B Visa Fee and the Demand for Information Technology and Other Professional Specialty Workers

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Abstract:

The cap of 195,000 on newly approved H-1B visas, which enable employers to temporarily import workers to fill professional specialty occupations, is set to revert to 65,000 on October 1, 2003. On that date, as well, the user fee that has funded education and training programs intended to increase the supply of high-skilled U.S. workers is due to expire.

The underlying motivation for Congress' raising the limit on H-1B visas in 1998 and again in 2000, from the level set by the Immigration and Nationality Act of 1990, was the perceived shortage of workers with information technology (IT) skills (e.g., computer systems analysts). Congress also initiated a more long-term remedy to the seeming mismatch between the qualifications of U.S. workers and the technical skill requirements of U.S. employers: the imposition of a user fee on employers who file petitions to bring into the country, to extend the stay of, or to hire from other U.S. employers nonimmigrant professionals in order to fund programs intended to prepare U.S. students and workers for high-skilled jobs and thereby to reduce employers' reliance on H-1B workers. Most of the user fees are allocated to two programs authorized in 1998, namely, the Computer Science, Engineering, and Mathematics Scholarship (CSEMS) program in the National Science Foundation and the Technical Skills Training Grant program in the Department of Labor (DOL). Between spring 2000 and summer 2002, the CSEMS program awarded $129.3 million to colleges and universities to provide scholarships to low-income, academically talented students enrolled in undergraduate and graduate degree programs in these disciplines. Through July 1, 2003, the DOL program awarded $228.6 million to local workforce investment boards and businesses to provide training in technical skills to employed and unemployed workers. Thus far, more than 12,500 students have received scholarships and more than 56,000 individuals have participated in training. Given the few years in which the programs have been in effect and the multi-year duration of awards, many scholarship recipients have not yet completed their education and many workers have not yet completed their training.

The 108th Congress is reconsidering the H-1B visa cap and user fee in a muchchanged economic environment. In March 2001, the economy entered a recession from which it has been slow to recover. IT-intensive industries remain especially hard hit. The reduced demand for IT workers is reflected in the number of approved new H-1B visas having fallen short of the cap in recent years. If the ceiling drops by two-thirds on October 1, 2003, however, employers of H-1B workers in occupations in which demand has remained strong would face heightened competition for visas -- particularly in a revival of the IT sector. The education and training programs paid for with H-1B user fees would cease operation if the user fee were allowed to expire, thereby eliminating one means of mitigating the alleged long-term skills mismatch. This report will be updated for legislative activity concerning the user feefunded education and training programs. (For information on legislative activity concerning the visa cap, see CRS Report RL30498, Immigration: Legislative Issues on Nonimmigrant Professional Specialty (H-1B) Workers.)