TV News Report

Channel 10 TV news in Sacramento ran a report on H-1B tonight, one of the more careful brief treatments of the subject that I’ve seen.  My UCD colleague Giovanni Peri and I are interviewed, and apparently Programmers Guild President Kim Berry is in the next segment.

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Software Developers, American or Foreign, Are NOT Always of Good Quality

One defense the industry lobbyists like to use when confronted with overwhelming evidence that there is no STEM labor shortage, even in the computer fields, is that software developers are not interchangeable.  Typically the lobbyists are referring to specific skill sets, such as Android (a red herring, as I’ve explained in detail before), but in some cases they are simply talking about raw quality.  As I’ve stated many times, I strongly agree with the lobbyists on this point.  For instance, studies have shown that there is at least at 10::1 ratio in productivity between the best and weakest programmers.

However, this applies equally well to both American (U.S. citizen/permanent resident) and foreign (H-1B etc.) programmers.  The lobbyists would have you believe that the foreign workers are of uniformly high quality, but that is certainly not true.

I was moved to write this post after seeing these comments on Slashdot, a popular techie news site.  The Slashdot posting, titled “What Portion of Software Developers Are Bad at What They Do?”, says in part

We are looking to fill a senior developer/architect position in our firm. I am disappointed with the applicants thus far, and quite frankly it has me worried about the quality of developers/engineers available to us. For instance, today I asked an engineer with 20+ years of experience to describe to me the basic process of public/private key encryption. This engineer had no clue. I asked another applicant a similar question: “Suppose you wanted to send me a file with very sensitive information, how would you encrypt it in such a way that I would decrypt it?” The person started off by asking me if it was an excel file, a PDF, etc. In general, I’m finding that an overwhelming number of developers I’ve interviewed have poor understanding of key concepts, especially when it comes to securing data. 

To me, that second example, in which the applicant thought that one could not use the same encryption algorithm regardless of the file type, epitomizes the problem.  Though it is technically not about programming per se, it certainly shows that that applicant “just doesn’t get it.”

In my experience, a substantial portion of computer science students, including foreign Master’s students (the industry lobbyists’ favorite group; see below), “just don’t get it.”  It is usually not as blatant as the above “file type” example, but of very serious concern.

This point is directly relevant to proposed legislation now in Congress, in which a common provision would give special visa and green card deals to foreign STEM graduate students at U.S. universities.  The rationale for this is that these are supposed to be the “good” H-1Bs, the ones whose addition to the U.S. workforce raises the overall quality.  But the reality is just the opposite:  As shown in my research and those of others, the average quality of the foreign CS grad students is LOWER than that of their American peers.  (I do have to add, as always, that there are also some really brilliant ones, whose immigration I strongly support.)

All this matters — a LOT.  Not only are the foreign worker programs reducing job opportunities and wages for American software developers, the programs are also resulting in BAD CODE that affects each and every one of us.  The IT disaster in the rollout of Obamacare is a perfect example, very expensive (including in terms of Obama’s political capital), harmful to many who were most in need of it, and reportedly due to incompetent programmers, said to be largely H-1Bs.

Similarly, consider the fact that one of the major companies in the U.S. electric power grid is in the process of firing American ITers and replacing them with H-1Bs.  Putting aside the issue of possible national loyalty conflicts, the prospect of less-competent programmers working on this key to our security is rather scary.

Congress should ignore the industry campaign dollars and look at the big picture.

Wadhwa Controversy

This morning a reader called my attention to a startling blog post, “Why Did WNYC Delete Its Podcast on the Male “Expert” on Women in Tech?”  The “expert” in question is Vivek Wadhwa, a former tech entrepreneur turned tech industry analyst, familiar to many readers of this blog for his strident support of legislation expanding H-1B and other foreign tech worker programs.  Vivek has also been outspoken on the status of women in the tech field, and in so doing has apparently offended some of the very people he aims to defend.

According to the blog post, an NPR affiliate withdrew a podcast featuring Vivek, and in the process made comments that Vivek now considers libelous.  I find this richly ironic, as a few years ago I publicly (in my e-newsletter) complained about incorrect and presumably libelous statements Vivek made about me.  He basically said that I fabricate my data in studies on H-1B.  Of course, this is one of the worst charges one can bring against an academic.  Worse, Vivek later made the same charge again, as I also reported in my e-newsletter.  The whole thing was absurd, since my research is based on publicly available data, such as the PERM green card data; anyone can verify my analyses.

Having said all that, I must say I sympathize with Vivek here.  Apparently Vivek has engaged in the same “Zelig” behavior regarding the women’s issue as on H-1B, showing up everywhere.  But that is partly due to the nature of journalism, who like to find one “go to” person and then constantly quote him/her.  None of his critics on the women’s issue seem to find fault with any of his statements on the topic.  Without having listened to the actual podcast, it does seem wrong to me that the radio station removed it.

The SCE Incident and Its Possible Impact on the H-1B Debate

As some readers may know, Southern California Edison, which supplies power to much of southern California, is reportedly replacing 500 IT workers with H-1Bs.   San Diego congressperson Darrell Issa has issued a statement in which he calls the action “deeply disturbing,” and offers his own legislation as a remedy.

Over the years, there have been a number of such cases, involving major firms such as the Bank of America.  The Programmer Guild’s report, “How to Underpay an H-1B,” should be required reading for all on Capitol Hill.

Many victims of the H-1B program are elated that finally there is an incident that dramatizes their plight, after years of being utterly ignored by their Congress, and indeed by their Presidents (including the current one).   HOWEVER…

This incident actually could hurt those victims’ cause, as I’ve stated so many times, and which is clearly seen in Issa’s “remedy”  — his legislation would EXPAND THE H-1B PROGRAM.

Yes, Issa’s “solution” is to EXPAND the H-1B program!  Isn’t that a huge contradiction?  Not if you accept the implicit premise in Issa’s comments, which is that the “Infosyses” — rent-a-programmer firms, mostly Indian — are the Bad Guys, while the U.S. mainstream firms, the “Intels” are the Good Guys, using the program responsibly.  (Infosys is one of the vendors supplying H-1Bs to SCE.)  Under that (badly incorrect) assumption, it makes perfect sense to enact legislation which is (mildly) punitive to the Infosyses, while rewarding the Intels by expanding the program.

That Good Guys/Bad Guys dichotomy is simply invalid.  The Intels replace U.S. citizen and permanent resident workers by H-1Bs too, just much less visibly, under the cover of layoffs.  And much more important, the Intels hire tons of H-1Bs in lieu of qualified Americans in the first place.

A much-publicized (though unfortunately forgotten) example of this involved Cisco, one of the most prominent Silicon Valley firms.  An American engineer saw a Cisco job ad, with a contact name, and after a little digging he discovered that the contact didn’t work for Cisco.  Instead, she worked for Fragomen, the nation’s top immigration law firm.  Though the ad stated that applicants must be U.S. citizens or green card holders, the purpose of the ad was apparently to screen OUT American applicants, so as to satisfy legal requirements needed for Cisco to sponsor a foreign worker for a green card.  This kind of action was described in a dramatic (but again forgotten) video in which another top immigration law firm was caught saying,

And our goal is clearly, not to find a qualified and interested U.S. worker. And you know in a sense that sounds funny, but it’s what we’re trying to do here. We are complying with the law fully, but ah, our objective is to get this person a green card, and get through the labor certification process.

That firm, Cohen and Grigsby of Pittsburgh, represents many MAINSTREAM firms.  We are NOT just talking about the Infosyses; on the contrary, most of the latter firms don’t sponsor their foreign workers for green cards, so we really are talking about the Intels.

Sadly — I could say tragically — many of the critics of H-1B have bought into this “Infosys no! Intel si!” mentality, playing right into the industry lobbyists’ hands.  As a result, we see bills like Issa’s and the Senate comprehensive immigration reform bill of the last Congress, both of which would EXPAND the H-1B program (as well the employer-sponsored green card program, just as pernicious) under the guise of clamping down on the Infosyses.  See the EPI report cited in the Computerworld article I’ve linked to above.

Note by the way that SCE’s action is probably perfectly legal, contrary to what two highly pro-immigration (but seriously mistaken) pundits think about the law.

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Update on the Zavodny Job-Creation Research

In a post a few weeks ago, I cited the analysis by R. Davis on some research conducted by Professor Madeline Zavodny of Agnes Scott College.  Among other things, she had found that for every 100 immigrant workers with graduate degrees in STEM, 262 jobs (not necessarily in STEM) are created.

Needless to say, the advocates of expansion of foreign tech worker programs like H-1B have been making lots of hay out of Zavodny’s findings.  This of course is no coincidence, since those same advocates commissioned Zavodny to do the research.

R. Davis, a Silicon Valley engineer who wishes not to use his full name, has done a very impressive job in trying to verify and revisit Zavodny’s analysis.  This has led to a very informative Science Careers article, In the last week or so, I’ve been running some of Davis’ code myself to explore Zavodny’s data, resulting to the update you are now reading.

I ask the reader’s patience, as the issues are as subtle as they are important to the H-1B debate.  The details matter.  But in outline form, my points will be:

  • R. Davis has been able to replicate Zavodny’s findings.
  • Zavodny’s findings do not make economic sense.
  • Zavodny’s results have serious methodological and statistical issues.

Let’s get the easy issue out of the way first, the replication of Zavodny’s findings.  She had generously given R. Davis her data and code (another researcher doing similar work, again funded by the lobbyists, refused to do so), and Davis found that the data had a lot of missing values.  Zavodny had coded them as 0s, which seemed wrong, but it turns out that the software she used automatically excluded such values, as she was applying a log transform. Once that was cleared up, Davis was able to replicate all of Zavodny’s numbers.

Davis’ site has a wealth of interesting findings, which I urge readers to peruse, but here is what I regard as the central issue:  Are Zavodny’s numbers of any relevance?  As far as I can tell, the answer is solidly No.

I always tell my students and consulting clients that one must always check statistical results with what is known qualitatively about the given issue.  Do the numbers make sense?

Common sense tells us that for the foreign grad students in STEM to have some sort of special job-creating powers, one of two conditions would have to hold:  Either (a) there is a STEM labor shortage or (b) the foreign students are more talented than their American peers.  Both (a) and (b) have been shown clearly to be false, using multiple data sources.

Concerning (a), even the H-1B advocates agree that wages in STEM, including in the computer field, have been flat at best.  In a previous blog post, I noted that NACE, the National Association of Colleges and Employers, projects that starting salaries for new computer science graduates (Bachelor’s degree level) will be DOWN 9% this year.  And NACE’s projected CS Master’s salary for 2015, $71,140, is down from $73,400 in 2013 (I have been unable to get the 2014 figure), which in turn was down 8.7% from 2012.   There really is no room left for legitimate debate on the shortage issue.

As to (b), research by two NBER affiliates, as well as my own work, shows that  the foreign STEM students tend to be, relative to their American peers, (i) graduates of less-selective institutions, (ii) less likely to file patent applications, (iii) less likely to work in R&D (crucial to job creation!), and so on.

So, if the foreign workers are not remedying labor shortages and aren’t smarter than the Americans, how can they be creating extra jobs?  Zavodny’s results counter common sense, and though common sense is sometimes wrong, Zavodny bears the burden of proof to demonstrate that it is wrong.

On the contrary, she herself concedes that the issue of causation is key. Indeed, she writes in her paper,

But one of the fundamental challenges when using cross-state comparisons to show a relationship between immigrants and jobs is that immigrants tend to be more mobile and go where the jobs are. As a result, evidence of high immigrant shares in states with strong economic growth and high employment could be the result of greater job opportunities (as immigrants move to jobs), rather than the cause. Cross-state comparisons would then show an artificially high impact of immigrants on the native employment rate. The study avoids “overcounting” the effects of immigrant workers drawn by a recent economic boom by using an estimation technique (known as “two-stage least squares (2SLS) regression estimation”…

Methodology such as 2SLS is controversial, and highly sensitive to assumptions.  Yet almost none of Zavodny’s results, including those employing 2SLS, is statistically significant at the standard 0.05 level.  Significance testing itself has its problems, but Zavodny’s work would be highly questioned by journal reviewers if she had submitted it to academia, rather than writing a paid advocacy report as she did.  She also uses clustered standard errors (which are used in the significance testing), another controversial technique.

Indeed, state-by-state comparisons themselves have a long history of controversy.  As I wrote in my original post,

Worse, region-by-region analyses are notorious for being unreliable and misleading.  For example, there have been numerous studies on capital punishment, both pro and con, based on comparing states that do and do not have capital punishment., in terms of murder rates and so on.  They can’t all be correct.

There have been similar issues with state-by-state studies of the impact of minimum-wage laws.

To me, the most important flaw in Zavodny’s analysis, also related to the causation issue, is that it doesn’t ask the obvious question:  What job creation rate is associated with hiring Americans?  If one is going to use Zavodny’s data to advocate for expanding the H-1B program (as she does), then why calculate only the foreign job creation rate?  Why not calculate the American job creation rate too, and then compare them?  Some of you may recall that this was a major criticism that I made regarding one of Bill Kerr’s papers.

This is crucial.  What if those jobs filled by the foreign workers had been filled by Americans?

I do need to make one correction to my original post.  I had mentioned how much I liked R. Davis’ graph titled, “Foreign STEM Workers, 2000-2007.”  Actually, I still like it, and in fact intend to use something like that as an illustration in the book I’m writing on regression.  But I realize now that my comments about the graph were misleading.  I had written that it is a good illustration of Simpson’s Paradox, which in fact it is — IF one’s regression analysis does not have terms for the states.  Zavodny’s analysis does have those terms.

Nevertheless, my comments still hold.  Zavodny’s coefficients for the states are much larger than for the share of foreign workers, just as the graph shows.  Whenever there is such a large disparity in sizes of coefficients, one must be very careful, as the small ones are likely very sensitive to the inevitable violations of the assumptions of the model.  Of course, the lack of statistical significance of most of Zavodny’s results makes this concern even more acute.

Again, since there is no STEM labor shortage and since the average quality of the foreign workers is lower than that of the Americans, the burden of proof is on Zavodny to make a strong case for her claims.  She has not done so.

Finally, I must commend Science Careers blogger Beryl Benderley for not only covering this topic, but also especially for pointing to the fact that Zavodny’s research was sponsored by an advocacy group.  The press almost never mentions this.