Friday, November 21, 2014

OPT extension to cost current STEM workers 175.5 billion in earnings

Updated: November 21, 2014

American Tech Workers Successfully Win Standing to Sue on Alleged Illegal Issuance of STEM-Related Work Authorization

Source: Link

American workers at a huge hiring disadvantage.
* Judge recognizes that OPT foreign-workers are Social Security and Medicare exempt.

The Programmers Guild and the Immigration Reform Law Institute, have been denied a preliminary injunction against the Bush administration's 17 month extension of OPT-CPT training visas for foreign graduates studying STEM coursework.

Catch up on the details here:
Judge rejects student visa injunction sought by H-1B opponents
Patrick Thibodeau: Computerworld, August 7, 2008

Here's the problem:

"Hochberg's ruling focused less on the merits of the case and more on whether H-1B opponents had legal standing to bring it, noting that they could not show they had been directly hurt by the student visa extension."

One way to demonstrate direct harm to current STEM workers would be to show the effect of the added temporary foreign workers impacting the lifespan of the STEM career.

BLS STEM Employment 2005 = 5,228,040
Avg STEM Salary 2005 = $64,560.00

U.S. citizens and permanent residents:
Bachelors Degrees Science and Engineering (S&E) awarded

1995 = 363,463
1996 = 369,927
1997 = 373,745
1998 = 375,909
1999 = missing
2000 = 383,438
2001 = 384,492
2002 = 399,288
2003 = 421,730
2004 = 436,372

Total = 3,508,364
(389,818.22 avg. per yr.)

STEM Career to replacement factor (domestic) = 13.41 years
(2005 STEM employment divided by avg. S&E (citizen and perm res.) bachelor degree production.)

* Domestic bachelor's degree production will increase naturally and congruent with demand.
* Bachelor's degrees are not the minimal educational requirement for all STEM occupations, but it would only take 13.41 years of bachelor degree production to replace the entire STEM workforce.
* S&E degrees are not the only degrees relevant to STEM occupations.

Without additional foreign labor supply, the average US, S&E undergraduate could expect a STEM career lifespan of 13.41 years, before being replaced by a domestic candidate with an updated degree. 

Source data: Institute of International Education

Nonresident aliens:
Bachelors Science and Engineering 
(S&E) awarded
1995 = 14,685
1996 = 14,747
1997 = 14,737
1998 = 14,709
1999 = missing
2000 = 15184
2001 = 15,714
2002 = 16,323
2003 = 17,704
2004 = 18,606

Total 142,409
(15,823.22 avg per yr.)

STEM Career to replacement factor (domestic & foreign grads) = 12.89 years
(2005 STEM employment divided by avg. S&E (citizen and perm res. plus nonresident alien) bachelor degree production.)

Lost career lifespan caused by retaining foreign S&E graduates via temp. visas = 0.52 years

Dollar impact to each current STEM worker = $33,571.20

The effect of modifying immigration policy, with intent to retain all foreign S&E graduates in the tax subsidized OPT visa (Social Security and Medicare exempt), combined with the H-1B visa, which includes unlimited extensions (beyond the 6 year limitation) for Permanent Residency applicants,  is extremely detrimental to the competitiveness of the citizen and permanent residents.

Extending the OPT visa an additional 17 months, with CPT provisions for STEM students, ensures that a higher percentage of foreign-students will fall into the temporary-worker loophole, and that foreign-students will enjoy a hiring preference while transitioning from working-student status, to H-1B.    

Total lost earnings to citizen and perm res. STEM workforce = $175,511,576,448.00
(Employed STEM earnings lost in career lifespan, shortened by .52 years)

STEM Bachelor degree data

STEM Employment data

Details on OPT - CPT status

Source data for chart:
Institute of International Education

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