From the Director: Broken Immigration System Hurts Detroit’s Economy

By Steve Tobocman

H-1B Visa Cap Denies Area Employers Critical Talent to Grow Businesses

Global Detroit, the Detroit Regional Chamber, the Michigan Office for New Americans, Ann Arbor SPARK, MichBio, and other business and economic leaders joined similar groups across the Rust Belt in highlighting the economic costs and job losses that the federal immigration system imposes by restricting local employer’s ability to hire skilled immigrant labor.

NA-CF330_VISA_16U_20150407200905On Tuesday, the federal government closed the H-1B application period for 2015-16, having received more applications than the 65,000 available positions to be awarded annually. This is the 13th year in a row that the supply of H-1B visas has been exhausted with 124,000 applications and 172,500 applications filed within five days of the application period opening in 2013 and 2014, respectively.

Leaders from these organizations gathered at LLamasoft, an Ann Arbor-based global leader in supply chain design software to discuss the importance of skilled international talent to Michigan’s companies and economy. LLamasoft employs some 200 high-tech workers across the globe with the majority operating in the Ann Arbor headquarters. In 2014, the company was ranked as the 139th fastest growing technology company in North America by Deloitte’s Technology Fast 500.

LLamasoft President and CEO Don Hicks explained that the company must hire the world’s most talented and best-educated STEM workers in order to maintain its competitive advantage in a rapidly-changing software industry that thrives on innovation.

“After losing the 2014 H-1B visa lottery, LLamasoft was forced to, in effect, deport one of our most valuable workers and to transfer that salary and the accompanying economic activity and tax dollars abroad,” Hicks noted. “As a U.S. military veteran, it pains me to think that U.S. immigration law would tell my business that it cannot hire the kind of talent that we rely upon to build the world’s most innovative supply chain solutions that help the Big Three and other American retailers, as well the U.S. military and global health care providers.”

While these leaders spoke at LLamasoft—hosting Michigan’s only H-1B Visa Cap event—similar efforts were undertaken across Ohio, Pennsylvania, and New York. The simultaneous efforts were supported by the WE (Welcoming Economies) Global Network, a 10-state regional network comprised of over a dozen regional economic development initiatives from across the Midwest working to tap into the economic development opportunities created by immigrants.

“We want our national elected officials to understand that especially in Metro Detroit and across Michigan, as well as in other urban centers across the nation’s industrial heartland, immigration reform is a critical component of a prosperous economic future,” said Steve Tobocman, Global Detroit Director. “These are not esoteric issues that only impact Silicon Valley, but relate to real companies willing and able to create real jobs in Michigan and growing their businesses to be able to hire additional Michiganders,” Tobocman added.

A 2014 Partnership for a New American Economy report highlighted Metro Detroit as having the 4th largest number (nearly 11,000) of H-1B applications denied in 2007 and 2008. Using statistical predictors the PNAE report estimates that approval of these visa applications would have generated as many as 15,000 additional jobs for U.S.-born workers in Metro Detroit, adding as much as $135 million in wages for existing U.S.-born computer workers in Metro Detroit.

On April 2, 2015 the Brookings Institution released new information analyzing 2013 H-1B approvals and the Detroit Metro area actually ranked 8th in the nation with 7,443 approvals. This ranks higher than Seattle, Boston, the Research Triangle, Houston, Philadelphia, or Atlanta. In fact comparing the number of H-1B approvals to the total employed population in the metro found that the Detroit Metro ranked 9th in the nation, while the Ann Arbor metro ranked 10th among U.S. metros with the highest ratios. Both have more than twice the national average.

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