Foreign STEM Workers

Erick Widman

The demand for high-skilled foreign workers in STEM fields is high, but there are only 85,000 H-1B visas available annually. However, according to a report by economists from the National Bureau of Economic Research, foreign STEM workers are actually increasing the wages of native-born workers without taking their jobs.

The report analyzed the effect of foreign STEM workers on wages and employment of college-educated and non-college educated workers in 219 US cities from 1990 to 2010. The study found that foreign STEM workers, who are the majority of H-1B visa holders, play a vital role in creating and adopting scientific and technological innovation. Their contributions have led to increased productivity, which in turn has boosted the wages of native college-educated and non-college educated workers.

For example, a one percentage point increase in the foreign STEM share of a city’s total employment has increased the wages of native college-educated labor by 7-8 percentage points and the wages of non-college educated natives by 3-4 percentage points. However, the study found no significant effects on employment levels. These findings support the idea that immigration, specifically foreign STEM workers, can stimulate innovation and local economies, leading to job creation and overall economic growth.

As a result, some state and local leaders are exploring ways to encourage and support immigrant innovators and entrepreneurs.

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