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February 12, 2013 12:21 PM How Foreign Students Hurt U.S. Innovation

By Norman Matloff

In the old days, the U.S. program for foreign-student visas helped developing nations and brought diversity to then white-bread American campuses. Today, the F-1 program, as it is known, has become a profit center for universities and a wage-suppression tool for the technology industry.

International students are attractive to strapped colleges because they tend to pay full tuition or, in the case of public institutions, pay more than full price in out-of-state rates.

Last year, this was taken to a new level at California State University, East Bay, a public institution just south of Oakland. The school directed its master’s degree programs to admit only non-California students, including foreign students. Even before this edict, international students made up 90 percent of its computer-science master’s program.

The pursuit of foreign students by U.S. schools affects not only college access for Americans but also their careers. Back in 1989, an internal report of the National Science Foundation forecast that a large influx of F-1 doctoral students in science, technology, engineering and math — the STEM fields — would suppress wages. The stagnant salaries would then drive the American bachelor’s degree holders in these fields into more lucrative areas, such as business and law, after graduation, and discourage them from pursuing STEM doctorates.

Americans Diverted

This projection was dead-on. Contrary to the industry lobbyists’ claim of student shortages in these fields, an extensive 2007 Urban Institute study found that the U.S. has plenty of STEM graduates at the bachelor’s degree level, but few go on to graduate work in the field.

The shift has spawned a new term, “diversion,” alluding to the STEM grads who are diverted to other fields. Other professions use similar talents but pay much more and have brighter job prospects. Former Federal Reserve Chairman Alan Greenspan has also advocated importing foreign workers to hold down wages (at all degree levels) in the technology industry. Financially, “it’s crazy to go into STEM” if you are a young person who is talented in math, as Anthony Carnevale, the director of Georgetown University’s Center on Education and the Workforce, put it.

Yet, seemingly oblivious to this troubling situation, President Barack Obama is proposing that we give special green cards to all foreign graduate students in these fields. Republican Senators Orrin Hatch and Marco Rubio, among others, have made similar proposals.

To such boosters, every foreign student is a future Nobel laureate. As Democratic Representative Zoe Lofgren, author of one proposal, has said, “You can’t have too many geniuses.” To be sure, there are individual students from abroad who prove her point: the game changers. Yet the average quality of the international STEM students is lower than that of the Americans.

Focusing on computer science and electrical engineering, my recent research, which is scheduled to be published by the Economic Policy Institute in March, compared American natives with former F-1s who were working in the U.S. as of 2003. For workers of comparable age, educational attainment and so on, the former foreign students on average had fewer patent applications, attended lower-ranked U.S. universities and were less likely to be working in research and development positions. (Here is an earlier report I wrote.)

Interviewed after the Cal State East Bay furor, biology professor Maria Nieto said the increase in foreign students had decreased overall quality. The weak foreign students are being admitted “because they can pay,” she added.

Oversupply Effect

Not only was Lofgren’s comment about the geniuses a lot of hype, you can have too many STEM workers, as the National Science Foundation internal report’s projection showed. Last year, a commission appointed by the other top U.S. science agency, the National Institutes of Health, found that a severe oversupply has created a brutal job market for those who pursue doctorates in science research.

According to the report, graduates endure a gantlet of postdoctoral jobs (quasi-student positions that extend doctoral training) at low pay and long hours for years, all the while not knowing whether a permanent job will materialize in the end. For those who do eventually secure an academic position in biomedical research, the median age when starting the job is 37.

The NIH commission found that these bleak prospects may be dissuading the best and brightest Americans from entering careers in science research, and cited the large number of foreign postdoctoral researchers as a major cause of the glut of lab scientists. The Government Accountability Office has noted the relationship between that oversupply to the availability of foreign postdocs. About 54 percent of these postdocs are foreign.

None of this is to say the foreign student program should be shut down. But we shouldn’t be reducing educational and career opportunities for talented Americans.

Today, the F-1 and similar programs are discouraging qualified Americans from going into science and math careers, and are bringing us diversion, not diversity. Aside from the effect on individuals and their careers, there are serious issues of national interest. Displacing those Americans who might potentially be more innovative — extrapolating from the patents per-capita numbers — and filling classrooms with foreign students who aren’t as likely to produce such breakthroughs is a net economic loss for the nation.

How does the U.S. begin to fix this imbalance? Rather than offering work visas and green cards to all foreign students attaining U.S. postgraduate degrees, legislation should focus on facilitating the immigration of top talent.

Norman Matloff ,an occasional Bloomberg View contributor, is a professor of computer science at the University of California, Davis.

Comments

  • paul on February 12, 2013 4:15 PM:

    One the other hand (and I'm not saying this is anything like a full counter-argument) A big reason for the ostensible glut of non-US postdocs and low-wage graduates in industry is the current visa system, which essentially makes non-US students and graduates into indentured servants.

    Student and H1-B visas are like the reserve clause in baseball: take the deal your professor/employer offers you or go home, possibly on a few days' notice. No wonder wages are depressed and faculty "hire" as much cheap labor as they can.

    Giving such students and graduates a clear route to permanent residency would at least empower them to insist on wages and working conditions that match their counterparts. And these are not stupid people; they know just what they would be worth on the open market.

  • Michael on February 12, 2013 4:40 PM:

    Not every STEM graduate goes into NIH funded research. Those kinds of jobs have always been underfunded and paid poor salaries compared to jobs outside of the research lab. This is nothing new and if anyone thinks that their degree is a sinecure they need to look hard at the historical data.

    On the other hand, a Ph.D in Physics opens all sorts of jobs to the graduate including academia, finance, analytics (which covers a wide range of jobs) and government jobs. Of course, you have to have the aptitude. Jobs in the health sciences (not research) are still very desireable and there seem to be more and more jobs for a larger variety of persons.

    I don't think that Chinese students are dooming American student drawn to STEM to a life of servitude or lawyering. There are other choices.

  • Col Bat Guano on February 12, 2013 5:47 PM:

    Postdoctoral fellows in biomedical sciences are already indentured servants regardless of citizenship. While not all are funded by NIH, the vast majority are and the time spent in these positions has increased significantly in recent years. The idea that adding more people competing for those jobs doesn't suppress wages ignores simple supply and demand theory.

  • POed Lib on February 12, 2013 6:51 PM:

    NOrm is right. I talk to him regularly on these issues. These visas are destroying the job prospects of Americans. When I went to U of I, every Illinois student was guaranteed admission. The problem was staying in. Today, it's very hard to get in, and the school is overrun with Chinese, who mostly hate Americans. We need to restore land-grant universities to their function of education for the residents of the state.

    The huge number of H-1bs is destroying the IT industry. Once Indians get in, an American cannot get a job. The Indians will give them a bad rating. Indians work only with other Indians.

    Some years ago, I came into my office on Saturday morning. All teh Chinese were there. What's going on? A special "Chinese only" study section. The Chinese publish only with other Chinese. It's a closed shop, closed to Americans.

  • Patricia Shannon on February 13, 2013 6:01 PM:

    Why is it acceptable to point out that large numbers of educated immigrants compete for American jobs and reduce wages for the educated, but it is not acceptable to point out the same thing in regards to low-income immigrants. If course, the people who judge are usually educated people who are hurt by competition by educated immigrants, but benefit from the low wages of the poor.

  • Ebenezer Scrooge on February 15, 2013 7:07 AM:

    I'm very happy that there is some pushback against the STEM madness.

    I would, however, like to stress one thing that the piece insufficiently emphasizes. A STEM undergraduate major--especially physics--remains a great idea, if you can handle it. Employers and non-STEM grad schools remain impressed by it. Even law schools are impressed by a STEM background.

    This being said, the only reason for remaining in STEM after the bachelor's is the same as the reason for playing in a rock and roll band--you love doing it, don't care too much about the future, and America is famous as the land of second chances.

  • Allen Anderson on February 17, 2013 3:15 PM:

    Hmm... Interesting perspective from a Computer Scicence professor. A comprehensive study by Harvard Business School shows a very different point of view. So does Duke University Business School study, which argues that skilled foreign immigrants have made an immense contribution to the innovative business environment of the U.S. in the last 2 decades.

    http://www.hbs.edu/faculty/Publication%20Files/09-005.pdf

    http://www.hbs.edu/faculty/Publication%20Files/09-003.pdf