[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
              HELP WANTED: THE SMALL BUSINESS STEM 
                WORKFORCE SHORTAGE AND IMMIGRATION 
                REFORM
=======================================================================

                                HEARING

                               before the

               SUBCOMMITTEE ON CONTRACTING AND WORKFORCE

                                 OF THE

                      COMMITTEE ON SMALL BUSINESS
                             UNITED STATES
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD
                             APRIL 25, 2013

                               __________

                      [GRAPHIC] [TIFF OMITTED] 


            Small Business Committee Document Number 113-014

              Available via the GPO Website: www.fdsys.gov





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                   HOUSE COMMITTEE ON SMALL BUSINESS

                     SAM GRAVES, Missouri, Chairman
                           STEVE CHABOT, Ohio
                            STEVE KING, Iowa
                         MIKE COFFMAN, Colorado
                       BLAINE LUETKEMER, Missour
                     MICK MULVANEY, South Carolina
                         SCOTT TIPTON, Colorado
                   JAIME HERRERA BEUTLER, Washington
                        RICHARD HANNA, New York
                         TIM HUELSKAMP, Kansas
                       DAVID SCHWEIKERT, Arizona
                       KERRY BENTIVOLIO, Michigan
                        CHRIS COLLINS, New York
                        TOM RICE, South Carolina
               NYDIA VELAZQUEZ, New York, Ranking Member
                         KURT SCHRADER, Oregon
                        YVETTE CLARKE, New York
                          JUDY CHU, California
                        JANICE HAHN, California
                     DONALD PAYNE, JR., New Jersey
                          GRACE MENG, New York
                        BRAD SCHNEIDER, Illinois
                          RON BARBER, Arizona
                    ANN McLANE KUSTER, New Hampshire
                        PATRICK MURPHY, Florida

                      Lori Salley, Staff Director
                    Paul Sass, Deputy Staff Director
                      Barry Pineles, Chief Counsel
                  Michael Day, Minority Staff Director



                            C O N T E N T S

                           OPENING STATEMENTS

                                                                   Page
Hon. Richard Hanna...............................................     1
Hon. Grace Meng..................................................     2

                               WITNESSES

Mr. John Tyler, General Counsel and Secretary, Ewing Marion 
  Kauffman Foundation, Kansas City, MO...........................     4
Mr. Nagappa Ravindra, President, Ravi Engineering & Land 
  Surveying P.C., Rochester, NY..................................     6
Mr. Ryan Costella, Director of Strategic Initiatives, Click Bond 
  Inc., Carson City, NV..........................................     8
Mr. Morgan Reed, Executive Director, Association for Competitive 
  Technology, Washington, DC.....................................    10

                                APPENDIX

Prepared Statements:
    Mr. John Tyler, General Counsel and Secretary, Ewing Marion 
      Kauffman Foundation, Kansas City, MO.......................    31
    Mr. Nagappa Ravindra, President, Ravi Engineering & Land 
      Surveying P.C., Rochester, NY..............................    36
    Mr. Ryan Costella, Director of Strategic Initiatives, Click 
      Bond Inc., Carson City, NV.................................    39
    Mr. Morgan Reed, Executive Director, Association for 
      Competitive Technology, Washington, DC.....................    43
Questions for the Record:
    None.
Answers for the Record:
    None.


HELP WANTED: THE SMALL BUSINESS STEM WORKFORCE SHORTAGE AND IMMIGRATION 
                                 REFORM

                              ----------                              


                        THURSDAY, APRIL 25, 2013

                  House of Representatives,
               Committee on Small Business,
         Subcommittee on Contracting and Workforce,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 10:00 a.m., in 
Room 2360, Rayburn House Office Building. Hon. Richard Hanna 
[chairman of the subcommittee] presiding.
    Present: Representatives Hanna, Amodei, Meng, Clarke, and 
Chu.
    Chairman HANNA. This hearing is called to order.
    Thank you for appearing today to discuss two topics of 
critical importance to small businesses and our national 
economy: the shortage of workers with educations and skills in 
Science, Technology, Engineering, and Mathematics, also known 
as STEM, and immigration reform.
    Small businesses are the backbone of the United States' 
economy and the historic source of new jobs and innovation. 
Among American small businesses, high-tech firms that engage in 
STEM fields hold great promise in creating the kinds of jobs 
critical to helping rebuild our middle class.
    The potential of STEM-based firms to achieve this goal is 
evident in economic reports that show that even during the 
deepest troughs of the recession, many technology-dependent 
firms continued to grow and add jobs. In addition, wages paid 
in these industries outpaced those paid in most non-STEM 
occupations.
    Unfortunately, despite the great promise of technology to 
grow our economy and create solid middle class jobs, the share 
of degrees in STEM fields awarded by American universities has 
been in decline. In addition, a larger percentage of these 
degrees are earned by foreign students present in the United 
States on a temporary visa.
    As a consequence, 34 percent of small businesses surveyed 
reported difficulties finding qualified applicants for 
available positions. What we know is that we face a shortage 
and long-term gap between STEM jobs openings and qualified 
applicants.
    This Committee partially examined this issue at a September 
2011 hearing. During that hearing, small businesses and their 
representative associations testified that small businesses 
face shortages of workers even with elementary skills in STEM-
based disciplines.
    At the same time, many small businesses report an even more 
acute shortage of workers with post-secondary and advanced 
degrees in STEM disciplines. According to one estimate, by 
2018, there will be more than 200,000 jobs requiring graduate 
STEM-level training that businesses will not be able to fill 
with native-born workers.
    While the preference of many businesses and policymakers is 
to fill available jobs with American workers, it will take a 
great deal of resources and time to build up the pipeline of 
American students with advanced STEM skills. It can be done. I 
personally think we should pursue this task with urgency, and I 
have introduced legislation to do just that.
    In the meantime, however, in order to grow and remain 
competitive, small businesses need a reliable supply of skilled 
workers to meet their pressing workforce needs. Many have 
suggested that expanding programs for highly-skilled immigrants 
and guest workers could be a viable strategy to meet these 
needs while the United States improves its STEM education 
system.
    Today's hearing will examine a number of issues pertaining 
to immigration reform and the skilled workforce needs of small 
businesses, including the extent of the STEM workforce 
shortage, its economic effects on small business, and whether 
immigrants and guest worker visas reduce or improve wages and 
opportunities for the American worker. American has always been 
welcoming to those who seek freedom and opportunity, and if you 
talk at any length of time with any member of Congress or their 
constituents, you will find an American immigrant story.
    In today's global economy, small businesses are not just 
competing against larger rivals for market share; they are also 
competing for talent. Allowing small businesses to fill STEM 
job openings with foreign workers in the short-term will help 
those businesses grow and aid our economic recovery and make 
America more competitive globally.
    Once again, thank you all for being here today. I now yield 
to Ranking Member Meng for her opening statement.
    Ms. MENG. Thank you, Mr. Chairman. And thank you to all our 
witnesses for being here.
    Education is the foundation of America's economy, providing 
the tools for discovery and the skills to participate in an 
evolving global economy. Perhaps no fields are more important 
to this reality than Science, Technology, Engineering, and 
Mathematics, the so-called STEM disciplines. For many small 
businesses, success is often dependent on being able to hire 
these STEM educated workers. Without them, small firms would be 
left without the workforce they need to innovate and grow.
    It is easy to see the importance of STEM to the United 
States' economy. STEM occupations have lower unemployment rates 
and higher pay, showing a high demand for this workforce. 
Workers with an undergraduate major in STEM make a half million 
more over their careers than non-STEM majors.
    During the last 10 years, growth in STEM jobs was three 
times as far as growth in non-STEM jobs, and workers in these 
fields are less likely to experience joblessness than their 
non-STEM counterparts. As a result, it is clear that STEM 
education is playing a vital role in America's economy.
    Over the long-term, its role will expand even further. 
According to research from Georgetown University, STEM 
occupations will grow far more quickly than the economy as a 
whole, and by 2018, there will be 2.4 million job openings in 
STEM fields. Finding workers to fill these positions will be 
essential, both to the companies in these sectors and the 
overall competitiveness of America's economy. The primary way 
to fill these positions is through increasing education in 
these fields. In this respect, the federal government is 
playing a major role, providing more than $3 billion in STEM 
education funding through a wide range of agencies, including 
NSF, HHS, and the Department of Education.
    These initiatives are critical to improving two areas at 
the center of STEM education--graduate study and K-12 teacher 
training. Supporting graduate education in computer science, 
engineering, and mathematics will encourage more students to 
pursue a STEM path. Fellowships and stipends for graduate 
studies are crucial in this regard. Doing so will increase the 
supply of STEM workers, allowing the United States' businesses 
to achieve their full potential.
    Similarly, increasing the quality of teacher training at 
the elementary and high school levels will help reverse the 
reluctance of many of our young students to pursue STEM 
education. This is important because the Lemelson-MIT Invention 
Index has shown that 34 percent of young adults do not know 
much about these fields. A third of them said they were too 
challenging, and 28 percent said that their schools did not 
prepare them for STEM education. Simply put, investment in 
these teacher training programs can reverse these trends.
    Another important mechanism to filling STEM positions is 
through immigration. H-1B visas are the primary way that a 
foreign STEM worker would gain access to the U.S., but with 
only 85,000 spots, this year's limit was hit in just 10 days 
since taking applications. The result is that fewer foreigners 
trained in scientific fields are coming to work in America. Not 
only does this mean that it is harder to find qualified 
employees, but it means lower rates of entrepreneurship. To 
this point, according to research completed by the Kauffman 
Foundation, the proportion of immigrant-founded companies 
nationwide has slipped by 1 percent, and in Silicon Valley, the 
percentage of immigrant-founded startups declined by nearly 10 
percent. Fewer startups mean less growth and fewer jobs, both 
of which we need.
    With these complex issues before us, I am looking forward 
to today's hearing, which will provide insights into what our 
country can do to prepare and attract a STEM workforce. Doing 
so is essential for the U.S. to remain one of the most 
innovative and competitive economies in the world. 
Understanding how we can increase the quality of STEM education 
while encouraging greater participation in these scientific 
fields is imperative not just for America's workers and 
businesses but for the U.S. economy overall.
    I thank the chairman for convening this hearing and I yield 
back.
    Chairman HANNA. If committee members have opening 
statements I would ask they be submitted for the record.
    The lighting system is fairly simple. You have five minutes 
to deliver your testimony. We will be flexible with that. We 
want to hear from you. When you see the light go yellow you 
have another minute, but relax.
    Our first witness is Mr. John Tyler. He serves as general 
counsel and secretary of the Ewing Marion Kauffman Foundation 
in Kansas City, Missouri. Among his areas of expertise are 
issues related to innovation and highly-skilled immigration. 
Thank you, Mr. Tyler, for being here today. You may now deliver 
your testimony.

STATEMENTS OF JOHN TYLER, GENERAL COUNSEL AND SECRETARY, EWING 
 MARION KAUFFMAN FOUNDATION; NAGAPPA RAVINDRA, PRESIDENT, RAVI 
 ENGINEERING AND LAND SURVEYING, P.C.; RYAN COSTELLA, DIRECTOR 
 OF STRATEGIC INITIATIVES, CLICK BOND; MORGAN REED, EXECUTIVE 
       DIRECTOR, ASSOCIATION FOR COMPETITIVE TECHNOLOGY.

                    STATEMENT OF JOHN TYLER

    Mr. TYLER. Thank you, Mr. Chairman. Good morning to 
everyone.
    As the chairman said, I am the general counsel and 
secretary for the Ewing Kauffman Foundation. The Kauffman 
Foundation focuses on fostering economic independence by 
promoting entrepreneurial success and educational achievement.
    Small businesses, and in particular young businesses, have 
been a significant driver of job growth, and they are a major 
source of innovative products, services, and processes. More 
new firms and more growth can mean more jobs, more innovation, 
and improved standards of living. As such, U.S. policy must 
support small businesses, and especially the entrepreneurial 
subset positioned for the transformative growth that keeps our 
nation's economy vibrant.
    Among current policies that do not do that well is our 
immigration system, particularly for STEM businesses. According 
to the National Science Foundation, demand for STEM jobs has 
been growing, and part of the reason for that is not just 
demand within industry but also due to people retiring and the 
lack of native-born talent being educated in the relevant 
fields as the opening statements commented as well.
    According to data from the Department of Education and the 
Georgetown Center on Education in the Workforce, there is an 
estimate that the shortfall in STEM fields could be nearly 
224,000 workers by 2018 or about 25 percent of industry labor, 
that is if we just rely on a native-born workforce.
    Although these problems affect our economy and innovative 
capacity more broadly, they present distinct challenges for 
small business, which too often is at the mercy of an expensive 
process with too many businesses competing for too few visas 
that take too long to process. Small businesses frequently 
operate on limited budgets and personal sacrifice, particularly 
during the early stages. Survival, much less growth, can depend 
on a company's ability to attract and retain the right talent 
with the right skills and experience at the right time.
    Three changes in U.S. immigration law will help small 
business in this regard. First, increased numbers. All business 
will be helped by eliminating or raising the national caps on 
the EB series visas. Also, Congress should increase the annual 
H-1B visa allocation. Demand frequently exhausts supply before 
the visas are even available as the ranking member noted, 
including for the coming year. Moreover, increasing these 
numbers may increase jobs based on studies that show that an 
average of between two and five additional jobs are created in 
connection with each H-1B hired.
    More specific to small business, Congress should also 
consider setting aside a number or percentage of economic STEM 
visas for small business in recognition of the infrequency with 
which they generally engage the bureaucracy and the 
corresponding inability to realize efficiencies.
    A second change would be to provide a predictable path to 
permanent residency for foreign students who receive graduate 
or even bachelor degrees in STEM disciplines from U.S. colleges 
and universities. These visas could help in at least three 
ways. First, they permit holders to become small business 
owners, entrepreneurs, and job creators themselves. Second, the 
visas would presumably be portable because there is no employer 
to protect who has made an investment in obtaining the visa. 
Finally, these visas better position our nation to directly 
benefit from permitting a high quality education at a U.S. 
college or university instead of forcing those benefits 
overseas.
    My third recommendation recognizes that other changes will 
likely be of little value without changes in the process. The 
current process is too cumbersome, too time-consuming for all 
business, but especially so for small business. As evidence of 
that distinction, the service is more likely to recognize a 
longstanding large business as a ``trusted employer,'' entitled 
to expedited processing, which is fine, but Malcolm Goeschl 
asserts that the service is operated with the presumption that 
businesses could not have a legitimate visa need if they meet 
any two of the following three criteria, all of which are 
likely to encompass small business. Those criteria are having 
25 or fewer employees, having annual gross income of less than 
$10 million, and/or being less than 10 years old. Congress 
should ensure against such an ill conceived presumption, which 
this Committee might do directly given its responsibilities.
    In addition, the service should be required to afford 
presumptive status to H-1B holders and EB series applicants who 
original employer closes, particularly if they have a similar 
job or have started a legitimate company. Too often, those 
people lose their visa status and must leave or start over if 
they can.
    Given that only about 44 percent of firms founded since 
2003 survive after five years, there are significant risks for 
foreign employees of the other 56 percent, which because they 
are less than five years old are likely to be small businesses.
    Other nations are increasingly eager to welcome high-
skilled and entrepreneurial immigrants, particularly those 
trained at our colleges and universities. Without the types of 
changes I suggest, U.S. participation in the global brain 
circulation is more likely to be one-sided, meaning that 
knowledge and innovation will leave but do not circulate back, 
and small businesses will suffer.
    Thank you for the invitation to submit this testimony, and 
I look forward to your questions.
    Chairman HANNA. Thank you, Mr. Tyler.
    Our next witness is Nagappa Ravindra.
    Mr. RAVINDRA. Yes.
    He is president of Ravi Engineering and Land Surveying, 
headquartered in Rochester, New York. Mr. Ravindra began his 
business in 1995 and employs approximately 90 people. A native 
of India, he earned his master's degree in structural 
engineering from Syracuse University and has become a United 
States citizen.
    Mr. Ravindra, thank you for appearing here today. I would 
like to acknowledge your wife who is also here with you and 
drove down from Rochester.
    You may begin your testimony.

                 STATEMENT OF NAGAPPA RAVINDRA

    Mr. RAVINDRA. Thank you. Chairman Hanna, Ranking Member 
Meng, and members of the Committee, I appreciate the 
opportunity to testify in today's hearing on how the STEM 
workforce shortage is affecting small firms.
    My name is Nagappa Ravindra and I am the president of Ravi 
Engineering. We are a small engineering consulting firm based 
in Rochester, New York. I am here today to testify about how H-
1B visas are essential to small engineering firms that need to 
hire engineers with specific skill sets in order to serve our 
clients' needs. I also want to tell you my story and how my 
firm would not exist without work visas for engineers.
    I am a member of the American Council of Engineering 
Companies, the voice of America's engineering industry. ACEC, 
for short, members--numbering more than 5,000 firms 
representing hundreds of thousands of engineers and other 
specialists throughout the country--are engaged in a wide range 
of engineering works that propel the nation's economy and 
enhance and safeguard America's quality of life. Over 70 
percent of ACEC's members are small firms.
    My firm, Ravi Engineering and Land Surveying, has been in 
business since 1995. I came to this country in 1980 after 
graduating from the Indian Institute of Technology in Madras, 
India, with a Bachelor of Science degree in Civil Engineering. 
I got my Master's degree in Structural Engineering from 
Syracuse University and started my career as a structural 
engineer in a consulting firm in Syracuse, New York. I was able 
to get a green card within nine months with the help of my 
employer and became a citizen at a later time. After training 
for eight years, I moved to Rochester, New York to accept a 
high position in another consulting firm and worked another 
five years before starting my own business in 1995. I started a 
consulting engineering firm providing structural engineering 
services and went on to add employees and offer other services 
such as bridge design and inspection, land surveying, 
construction inspection, environmental and geotechnical 
engineering. Currently, we average 90 employees and have three 
offices in New York and one in Pittsburgh, Pennsylvania.
    As a member of ACEC, we advocate a quality-based selection 
process and we compete for work based on the strengths and 
talents of our employees. To win projects, we need to 
demonstrate exceptional qualifications and experience. So, in 
order to grow and succeed, we need experienced, as well as 
entry-level engineers who are exceptional and talented 
individuals. Our growth is limited because of a lack of 
qualified people in our industry. Currently, we have vacant 
positions we cannot fill due to lack of experienced engineers.
    Because there are not enough engineers with the skill sets 
we need, we currently employ one engineer on an H-1B visa and a 
student on an OPT visa. We had hoped to transfer the student to 
an H-1B visa, but as you know, the current cap of 65,000 was 
met in five days and our labor certification could not be 
completed in time.
    Engineers and the engineering industry are major economic 
drivers and play an essential role in helping the U.S. compete 
in the global economy. Engineers are in high demand, but the 
output of new engineers from the nation's universities is not 
keeping up with the needs of the industry and the nation.
    Bachelor's degrees in engineering have declined by nearly 
20 percent since 1985. The workforce is also getting older. 
Nearly 30 percent of all engineering and science degree holders 
in the labor force are 50 or over and are headed toward 
retirement.
    There is also greater competition for the diminishing pool 
of engineering graduates, particularly from the information 
technology industry seeking the skill sets that engineering 
graduates provide. Only half of engineering degree holders work 
in the engineering field. According to Duke University, between 
30 and 40 percent of graduates from the University's Master's 
of Engineering Management program take jobs outside of the 
engineering profession.
    Moreover, the proportion of foreign students earning 
engineering degrees at American universities is quite high. 
According to the American Association of Engineering Societies, 
for the 2008-2009 academic year, foreign nationals comprised 
43.9 percent of the Masters and 54.6 percent of the Ph.D.s 
awarded in engineering by U.S. universities.
    With so many engineering graduates from American 
universities working in other fields, it does not make any 
sense to send trained foreign engineers home to work for our 
competitors in the global marketplace. If I had not been given 
the opportunity to stay and work in the United States, 90 
American workers would not have the job opportunities provided 
by my firm. My story is not unique. Speaking from my personal 
experience, nearly half of my graduating class of 220 students 
from Indian Institute of Technology in Madras, India, came to 
the United States in 1980 to pursue higher education. Out of 
that pool of 110 engineers who came to this country, today, 
nearly 30 percent have their own businesses employing a large 
number of Americans; about 20 percent are CEOs, CTOs, general 
managers, and senior officers in Fortune 500 companies; 20 
percent of professors, deans, and educators in premier 
institutions; and the remaining have become venture capitalists 
and successful investors.
    I strongly believe that the United States needs to invest 
in talented and young engineers similar to investing in our 
roads, bridges, and infrastructure as a long-term strategy for 
growth and prosperity. I urge Congress to strengthen and expand 
the H-1B visa program so that firms like mine will be able to 
hire the necessary engineering talent to serve our clients' 
needs and continue to grow and thrive.
    Thank you for the opportunity to participate in today's 
hearing, and I would be happy to respond to any questions from 
Committee members.
    Chairman HANNA. Thank you, Mr. Ravindra.
    I now yield to a visiting colleague, Mr. Amodei, who will 
introduce our next witness.
    Mr. AMODEI. Thank you, Mr. Chairman and Madam Ranking 
Member. I was excited about doing this until I heard the last 
witness refer to people over 50 as getting older, so I am still 
dealing with a little bit of that. But I will drive on 
nonetheless.
    I appreciate your courtesies. It is a privilege to appear 
before you here today, not only as a member of the Immigration 
Subcommittee of the Judiciary Committee to get a little cross-
pollenization on what your fine Subcommittee is doing, which 
will be helpful in our work also, but also to introduce a 
fellow Carson High School graduate in the form of Mr. Costella.
    Now, in keeping with chronological accuracy that Mr. 
Ravindra has started, Mr. Costella, to make no mistake about 
it, went through that high school about two and a half decades 
after I did and has obviously made much better use of his high 
school start in his career than I have. But it is with some 
pride that I introduce not only a constituent but a person who 
represents a company that is a constituent company--a leader in 
national defense, aerospace, transportation; not only a major 
impact on local commerce but nationally, the fabric of our 
community; a company that employs over some 300 people in 
Nevada and Connecticut; folks that are innovators not only in 
their particular product line but also in terms of everything 
they are faced with--and that includes not only their product 
but also the way they manage, recruit, and administer the 
people that work for them, our most important resource.
    So with that, Mr. Chairman, I would yield back. Thank you 
for your courtesy, and I look forward to hearing from Mr. 
Costella, hopefully without any indications on how much younger 
than I he happens to be and how much more productive his 
professional career has been to date.
    Thank you.

                   STATEMENT OF RYAN COSTELLA

    Mr. COSTELLA. Thank you, Congressman Amodei. It is great to 
see you here. Thank you. And Mr. Chairman and Ranking Member 
Meng, thank you guys for the invitation. It is great to be 
here.
    This is a really important issue. As Congressman Amodei 
alluded to, I am the director of Strategic Initiatives at Click 
Bond, Inc., and we are headquartered in Carson City, Nevada, 
which is actually the state capital, for those of you who might 
think it is Las Vegas. We employ about 250 people in Carson 
City and then another 60 or so in Watertown, Connecticut.
    We are a family-owned business. This past year we 
celebrated our 25th anniversary. We are a very, very proud 
manufacturer in the United States. We are a company that is in 
transition. Since we are talking about generations and ages, 
our owners are actually transitioning toward handing the 
company to the next generation, to their son, and we are a 
company in transition. We are growing. There is no shortage of 
opportunities. We are the global leader in the design and 
manufacture of adhesive-bonded fasteners, primarily for the 
aerospace industry but we also do a lot of work in naval and 
marine, and increasingly other transit vehicle sectors. And for 
the laypeople, basically our parts are mechanical fasteners 
that we use adhesives to put into place that hold in all the 
electrical systems and planes and trains and ships and those 
kinds of things.
    As we look into the future, we have an incredible workforce 
that has done amazing work to make us the global leader, but a 
large number of our folks are baby boomers, and very similar to 
other companies, especially small businesses in this country, 
those folks are going to be leaving the workforce soon, and we 
have to replace them somehow. And on top of that, as I said 
before, we have major growth opportunities in front of us and 
we have to find the people that can help us achieve those 
goals.
    Unfortunately, in Nevada we have challenges with respect to 
education, and we have challenges with respect to retaining 
folk even in our state, and that is a totally different 
subject, but the point is when we look out into the future, 
filling those jobs is not going to be an easy task. Now, we 
have made some major investments in Nevada on trying to address 
this problem. We, as a company, have partnered with the 
Manufacturers Association in Nevada, as well as our fellow 
manufacturers themselves to partner with higher education 
institutions across the state, the Workforce Development 
System, the Economic Development Apparatus, as well as the K-12 
education system to really define what the needs are that we 
have.
    Historically, we have pounded our fists on the table and 
said we cannot find the people we need, and we were very good 
at pointing our fingers at the education system and anyone else 
that would allow us to point at them to tell them that we are 
not getting what we need. And I would say probably over the 
past three to five years we have really had a change of mind 
where we have said maybe we need to look in the mirror a little 
bit and we need to be a bit more proactive about defining what 
our needs actually are.
    And so we have been very involved in our work in Nevada in 
really saying, look, let us talk about with STEM skills really 
are. Everyone hears STEM and the first question is usually what 
the heck is STEM? And then they hear Science, Technology, 
Engineering, and Math. Okay, what does that mean?
    For us, STEM are the basics--reading, writing, the ability 
to do math, the ability to problem solve. And those things 
paired with a propensity to show up on time, to communicate 
effectively and work in teams, if someone has those skills, we 
can train them to do any job in our company. We can put them 
through school and they can become an engineer who invents the 
next greatest thing. Without those basics, there is not a very 
bright road ahead. And so we have really focused our work on 
trying to set that as the minimum standard--those basic 
reading, writing, and math skills. We tend to actually look at 
the National Career Readiness Certificate granted by ACT as a 
solid indicator of that.
    And then as you move up the chain, we have to realize that 
as manufacturers and as employers, when we want to tell the 
world, hey, we need these specific skills, we have to use some 
sort of common language so people understand what you are 
talking about. So we have really got behind the idea of using 
nationally portable, industry-driven credentials to particulate 
what our needs are.
    So at Click Bond we have a huge need for machine operators 
that can one day become journeyman-level machinists. So we 
align our needs with the National Institute of Metal Working 
Skills Credentials, and we have seen tremendous success in a 
program that has taken people literally from unemployment to 
full-time jobs with benefits and national credentials. So I 
would love to talk a little more about that.
    In closing, I see my red light is on here, as far as the 
immigration piece goes, when we need a person with a specific 
skill set, we look for someone who is the right fit who has got 
the skills, and if there is a way to build a larger pool of 
people as we grow and as other small- and medium-sized 
businesses grow, if we can have a larger pool of people to pick 
from that is more competitive, that just drives how much more 
excellent and competitive we can be in this global economy.
    So I look forward to your questions and telling you a 
little bit more about our company if you would like to know 
more. Thank you.
    Chairman HANNA. Thank you, Mr. Costella.
    I now yield to Ranking Member Meng, who will introduce the 
next witness.
    Ms. MENG. I am happy to welcome Morgan Reed, who is the 
executive director of the Association of Competitive 
Technology. ACT represents more than 5,000 small- and medium-
sized information technology firms and helps them leverage 
their intellectual assets to raise capital, create jobs, and 
continue innovating. Mr. Reed specializes in issues involving 
application development relating to privacy, intellectual 
property, competition, and small business innovation. He also 
serves on the SBA's Office of Advocacy Advisory Council. 
Welcome.

                    STATEMENT OF MORGAN REED

    Mr. REED. Thank you. And thank you for the introduction.
    Chairman Hanna, Ranking Member Meng, and distinguished 
members of the Committee. As you heard, my name is Morgan Reed, 
and we represent over 5,000 software and other high-tech small 
businesses throughout the world. Our members are at the 
forefront of the revolutionary changes happening today through 
mobile apps, cloud computing, and data management. And the best 
news is I am here to tell you today my members are hiring, or 
rather trying to hire.
    Chairman Hanna noted in his op-ed yesterday that small 
businesses are the engine of job creation. Well, for the mobile 
apps economy, we are dominated by small business; 70 percent of 
the top selling mobile apps, small businesses or micro 
businesses. Moreover, this is not a Silicon Valley-only 
phenomenon. In fact, the study we did in 2012 showed that 60 
percent of the app companies are actually outside of 
California.
    And of course, the growth that we have all talked about--
you have heard everyone at the table talk about--I want to put 
some numbers to that--$92,000--$92,000 is the current median 
pay according to the Bureau of Labor Statistics for a software 
engineer. Ninety-two grand. I know a lot of people who consider 
that a great living wage. And, of course, BLS predicts that 
there will be 120,000 new computing jobs annually through 2020. 
Unfortunately, my numbers cannot grow their companies if they 
are unable to hire the workers they need to make the next game 
or the next game changing application.
    But instead of talking BLS numbers or Department of Labor 
averages, I thought I would be a little more specific. So 
Congressman--Chairman Hanna, in your district, Enesco Avionics 
is looking for a software engineer to work in Endicott; BAE, 
looking for engineers. Congresswoman Meng, Hoptin Media, which 
is on Austin Street in Forest Hills, they are looking for a 
software engineer. Aurora Games in Jackson Heights, looking for 
a mobile app developer. Congressman Amodei, you obviously heard 
from Mr. Costella, but guess what? Hodges Transportation is 
looking for two engineers--a design engineer and a test 
engineer. Congresswoman Clarke, in your district I have got 
Cardwell Beach Marketing. They are looking for an interactive 
design engineer.
    All of these openings have been available for some time. 
And with these openings commanding high salaries one would 
expect that, well, America must be spiking in people pursuing 
computer science degrees. Remarkably, that is not happening. 
The primary reason is the steep decline in schools teaching 
computer science. Only one in 10 high schools offer the class. 
Students are less likely to major in a technical subject if 
they did not study it in high school. And with fewer computer 
science majors graduating from universities, we are woefully 
short on the talent our U.S.-based tech industry needs.
    Now, we know that improved STEM education can produce 
results. A National Science Foundation supported effort called 
Young People's Project is already out in the field working to 
improve math and science scores in schools in underserved 
communities. For example, Aria Fleming was a middle school 
student when YPP reached out to her in the Mississippi Delta. 
She clearly was not on a path to math and science education, 
yet she has now graduated from Tennessee State University with 
a degree in electrical engineering and works for Procter and 
Gamble. CodeNow is an afterschool program in New York that is 
taking high schoolers after school and teaching them how to 
code, and its graduates are winning national science awards and 
studying computer science in college.
    Now, we have seen the investment in STEM education at the 
secondary level has positive results, but this begs some 
obvious questions. One, does STEM education solve today's 
problem; and two, how do we pay for it? I mean, we all love the 
idea of putting more money into something but we have got to 
find some revenue to make it happen. And the reality is the 
tech industry is willing to step up. Right now we know that the 
tech industry has said something we rarely hear, which is 
charge us more, please. We are looking at the need for H-1B 
visas and saying double our fees for H-1B visas if that helps 
us get more workers today to solve problem number one, and also 
if that money goes to help solve problem number two, which is 
the STEM education need that we have.
    One of the key elements of the I-Squared Act, of course, it 
will raise $500 million annually over 10 years for STEM 
programs. This funding represents a fraction of the positive 
economic impact for future generations who can fill these jobs 
that are currently going overseas or worse, remaining unfilled.
    So I urge members of this Committee to help small 
businesses succeed by charging us more so that we can get the 
tech visas that we need now and get the STEM education that we 
need to grow America's workforce to meet our needs tomorrow.
    Thank you very much.
    Chairman HANNA. Thank you, Mr. Reed. I appreciate your time 
and testimony.
    Mr. Tyler, you said that the--maybe I misunderstood, but in 
order to qualify for the program, the immigration program, H-1B 
visas, the minimum is 25 employees, $10 million gross?
    Mr. TYLER. No, I am sorry, I may have misspoke, Mr. 
Chairman. What I was referring to was a practice at the USCIS 
that was documented at least in 2010, where the USCIS seemed to 
have a presumption that if a business had fewer than 25 
employees, if it had less than 10 million in annual revenue, or 
if it was less than 10 years old, any two of those three, that 
there was a presumption at the service that the company did not 
have legitimate visa needs.
    Chairman HANNA. On its face that seems absurd to me knowing 
that most companies start with one employed or, like Mr. 
Ravindra, start by himself. Can you elaborate on that? Maybe 
Mr. Reed would also because the tech companies in my community, 
most companies, start as a very small business with an idea and 
expand. So basically, we are limiting our helping small 
businesses simply by those rather arbitrary and capricious 
rules.
    Mr. TYLER. I agree. And Malcolm Goeschl in his article goes 
at some length to describe that process and how the presumption 
hurts. With that fundamental presumption in place it denies 
those businesses that meet those criteria the opportunity to 
hire talent, denies them the opportunity to grow and to advance 
their products, much less to advance the company's----
    Chairman HANNA. Well, Mr. Ravindra, who started with one 
himself, would not be able to be anywhere he is today at all. 
He would have to wait for years and years to grow to that size 
which almost by definition means he will never get there.
    Mr. TYLER. That is the impediment.
    Chairman HANNA. Mr. Reed.
    Mr. REED. I mean, let us be very specific. The high-tech 
industry is built off of companies that are incredibly small. 
We all know recently Instagram was purchased for $1 billion. 
They had 12 employees--12. Instagram. Huge. A lot of these tech 
companies as you say would not even hit that threshold even 
when they have hit true success. And the really key part--and 
you know, Mr. Ravindra here is a perfect example of that--is 
finding the right person. There is all this discussion about, 
well, we need STEM skills. We also need the right skills. Mr. 
Costella already referenced that about making sure that he has 
got the right kind of person to do the job.
    So the problem with that number is it arbitrarily limits 
small business to find that one right person who has that right 
skill that can make the difference between your company going 
public, being acquired, or failing. And so that is a huge part 
of the problem that we see with this artificial limit on the 
side.
    Chairman HANNA. So you would suggest then or that would 
suggest that there be no requirements whatsoever; that one 
person would be enough and one dollar and no years? Ten years 
is a long time to be in business in my view.
    Mr. REED. Well, a lot of the tech companies we work with 
have actually either been in business in one form or another 
for far longer than that. I think, and the Kauffman Foundation 
can weigh in, obviously the ideal would be to have the ability 
to get the right person instantaneously with no wait and no 
requirements. We are also pragmatic and we know that finding a 
solution that will meet 435 members' approval of the House and 
100 members of the Senate will be difficult, so there is ideal 
and what we think we can work with.
    Chairman HANNA. Let me ask you one other question. When 
tens of millions of people are out of work in this country or 
have simply given up or are under employed, how does the guest 
worker program--this is for any witness--help those people find 
work?
    Mr. REED. I will do a quick one. We have a member company 
in Illinois, and this is a horrible story because it actually 
talks about seven people who lost their job, but it fits with 
your model.
    This was a company that did service and they had a person 
from Britain who was in the United States on a H-1B visa. The 
visa expired and there were seven people that helped support 
that person on the bids that they did for large enterprise-
level companies in the Chicago area. They lost their H-1B visa 
person who was the team head, and those seven people could not 
go to work. So when you look at that number, I might have one 
H-1B visa, but if he is the key--or she is the key to making 
the rest of that bid possible, completing that RFP on time, 
then it is worth it to have that one person because that 
provides 7, 8, 10 more jobs to support the overall contract.
    Chairman HANNA. Thank you.
    Mr. TYLER. Mr. Chairman, if I might add to that, there are 
a couple of additional ways that the H-1B program can help but 
also needs to be changed. One of the ways that it currently 
helps is that there are studies that show for every H-1B that 
is hired there is an average of between two and five other jobs 
that are created to support the H-1B. So hiring the H-1Bs can, 
in fact, contribute to employing other folks as well.
    One of the ways in which the H-1B visa would need to change 
to get to your point about the unemployment rate, currently 
folks who are here on an H-1B have difficult, if not absolute 
barriers, to starting and growing their own company as an H-1B. 
And yet when we look at the impact of immigrants on the 
economy, if we look at the impact of immigrants on startups and 
new jobs and growth companies, 40 percent of the Fortune 500 
companies had immigrant founders that were part of them. 
Between 25 and 50 percent of various companies depending on the 
studies in Silicon Valley and biomedical industry in Boston, 
publicly traded companies with venture capital input. So 
between 25 and 50 percent of these companies have had immigrant 
founders.
    We need to do a better job. We need to do more to allow 
immigrants to start and grow companies, and the H-1B has 
impediments to that.
    Chairman HANNA. One other question, just generally.
    So what I have learned and I am pretty confident that we 
would all hear this, that STEM-related jobs are solidly middle 
class jobs. In a world where we see declining incomes, 
diminishing lifestyles, the American dream as we understand it 
generally becoming mere elusive and harder to attain, STEM 
educated workers, regardless of their origin, are people who 
pay taxes, and add value at all levels.
    I would like to yield to Ranking Member Meng for her 
questions.
    Ms. MENG. Thank you. I have a question for Mr. Costella.
    Community colleges can play a significant role in training 
STEM professionals. What experience does your company have with 
employing these types of graduates? And anyone can answer also.
    Mr. COSTELLA. Thanks for the question.
    Community colleges, I mean, they are such a godsend for us, 
especially in Nevada. I will tell you a little bit about some 
success we have had.
    We have a need, like I said before in my opening remarks, 
for machine operators. These are folks who--the machine 
operator, just for folks who do not know, is the entry-level 
point for a career in machining. So if you want to be a 
journeyman-level machinist that gets paid quite a bit of money 
to do your work, the entry point is a machine operator. We are 
not unique in the Northern Nevada area. A lot of small- and 
medium-size manufacturers have that need. So what we were able 
to do was come together as a community of employers and say we 
have the specific need, as I said before, we need to use the 
National Institute of Metalworking Skills credentials to 
validate that skill set. Then what we did is partnered with two 
of the community colleges up in Northern Nevada--Truckee 
Meadows Community College and Western Nevada College. We got 
them engaged in understanding what these credentials were and 
what they validate, and they agreed because these credentials 
are nationally portable and industry driven, and third-party 
validated and driven by longitudinal data, that they could 
actually grant academic credit along with the credential for 
anyone who would go through a program to receive it.
    We then partnered with the workforce system so that the 
community colleges could get their facilities up to par to be 
able to train towards the National Institute of Metalworking 
Skills standard, and then we partnered as a community basically 
to go look at the unemployment lines and screen people to say, 
okay, who has got the basic skills--reading, writing, math, 
problem solving--and who can pass a drug test? It is serious. 
People laugh but it is a problem.
    So the folks who could do that, who could earn the National 
Career Readiness certificate, be drug-free, were then 
interviewed. And the folks who made it through that process--I 
think somewhere around 40 folks ended up going through this 
program initially. In 16 weeks, they went through eight weeks 
of in-classroom training on measurement, safety, materials, 
five days a week, eight hours a day. The second eight weeks 
they did three days a week in the classroom and the last two 
days of the week were spent in on-the-job internships with the 
employers who had the need, who articulated that need upfront, 
paid internships, and in 16 weeks they went from being 
unemployed, went through a training program at the community 
college that had a demand-driven equation from the employers, 
and ended up I think over a 90-something percent success rate 
in becoming employed with benefits. And again, we are talking 
about the first level of a career machining, $12-$14 an hour 
with benefits. And it is up from there.
    And I am happy to say Click Bond, we actually hired four 
people out of that program and they are outstanding employees. 
I spoke with our vice president of production before I came out 
here and asked him how are these folks performing? And he said 
they are outstanding. They have got very, very bright futures. 
So that is a model that we saw a lot of success with in Nevada.
    Mr. RAVINDRA. If I may add, we hire a lot of construction 
inspectors who most of them come from community colleges and 
they are graduates of community colleges and there is a severe 
shortage of these inspectors that we hire and community 
colleges are a great place to produce these graduates.
    Ms. MENG. A question for Mr. Reed.
    You proposed to increase visa fees and use the additional 
revenue to pay for STEM education, and maybe Mr. Ravindra would 
want to answer, too. Do you believe that smaller firms would be 
able to afford these visas or would large businesses end up 
being at an advantage because of their deeper pockets?
    Mr. REED. The cost, when you look at an employee for the 
software sector, the cost of an H-1B visa--and worst of all, 
the time that it takes--remember, as you have all talked about, 
it was a matter of days until we hit that cap. So if you look 
at lost productivity, a few thousand dollars more is nothing 
compared to the cost of the acquisition of a talented software 
engineer. So if I am going to pay somebody $92,000 and you are 
going to say I am going to have to pay $2,000 or $3,000 more to 
acquire them, that is nothing. The legal fees that go into H-1B 
far exceeds the actual visa account. So whether you double our 
fees or more, it is not a significant portion of getting that 
right person. And so absolutely, unequivocally when I have 
talked to our members, they have said if I get the right person 
out of the deal I will take it in a heartbeat.
    Mr. RAVINDRA. Well, I do not know about that. As a small 
business, we are certainly watching our dollars and whenever we 
hire people we try to hire through the Internet and through 
trade journals, and realizing ourselves we do not even go 
through a head hunter. So any cost increase would not be looked 
upon kindly by the small firm industry. So it does affect our 
bottom-line. If that is what it takes to bring in more educated 
people with the right skill set we probably will, you know, pay 
for it but definitely it is not a good idea.
    Mr. TYLER. If I could add in, it may be worth considering 
some sort of or exploring some sort of a compromise similar to 
what the U.S. Patent and Trademark Office has done. They now 
have multiple tracks by which you can get patents through the 
PTO. And one of the tracks you get an expedited track if you 
pay a higher fee. So rather than increasing the fee on 
everyone, there is a possibility that a multi-tracked system 
could help. But particularly, considering the effect on small 
business, a track for small business could also be useful.
    Mr. REED. And I will amend mine to say yes, we all are 
watching our bottom dollar but right now the desire to get a 
product to market is really critical for us, and so there is 
another element of it that I think is important and that is 
that large businesses will actually be helping to build our 
domestic developer workforce. So I did not want to make it 
sound cavalier but I want to keep our eye on the prize, and our 
eye on the prize is getting talented work, American workforce 
built here in this country by any means that we can get it 
done.
    Mr. RAVINDRA. I just want to add one thing. I do agree when 
it comes to the cost allocation, the major cost is spent on the 
lawyers who help get the research together. So if we simplify 
the process we can simply save a lot of money and then the part 
that goes to pay for the H-1B visa itself is not a big portion 
of the whole process. So yes, I do agree with Reed. We can 
absorb some cost increase in the processing of the H-1B visa. 
If it is simplified quite a bit, then we save a lot of money on 
lawyers.
    Ms. MENG. Question for Mr. Tyler.
    While the number of foreign students in STEM fields has 
increased by 50 percent in the last 20 years, the percentage of 
the students receiving the temporary visas has remained the 
same. If more of these students were able to remain in the U.S. 
on H-1B visas, how would this affect American students' ability 
to secure employment in STEM fields?
    Mr. TYLER. That is an excellent question, and there have 
been a number of studies related to crowding out as it is. The 
Kauffman Foundation has not done those studies so I am not 
directly involved with those studies. But a number of the 
studies do show that there is not only not a crowding-out 
effect with regard to those jobs, but there is actually in some 
ways a crowding-in effect because with the foreign students 
getting jobs it is creating other opportunities. I mean, with 
the foreign students getting jobs there is still a need for 
teams. There is still a need for people to complement each 
other and to complement each other's skill sets. And there are 
studies that show that there is, in fact, a crowding-in effect 
as opposed to a crowding-out effect.
    Ms. MENG. Another question for Mr. Reed.
    The steep drop-off mentioned in computer science education 
at the high school level is very troubling. Is this a supply 
issue--are there not enough qualified teachers? Or demand 
issue--demand issue--students are not interested enough? Or 
both?
    Mr. REED. It is a little A plus B. You are exactly right. 
My own personal story fits this very much. My father was a 
computer science and mathematics teacher and I actually took AP 
math from my dad. So I am exactly what is part of this.
    What is interesting about that is if I look at my 
classmates in my dad's AP class from a high school in Alaska 
with 116 kids in it, I can name five of us that are now in the 
software industry in one form or another. And the problem that 
we are facing is that folks like my dad are retired. It is 
harder to find qualified math and computer science teachers 
that are willing to take that pay. I mean, the good news is a 
good software engineer earns $92,000. The bad news is it is 
really hard for a math and computer science teacher to make 
$92,000. So basic economics says if you are good at computer 
science, you are going to find a computer science job with one 
of us here at the table rather than teaching. So yes, A is part 
of the problem. And then B, we need to do more to encourage 
students to see the advantage from taking computer science even 
at a younger age. And so that is why we look at programs like 
CodeNow and others that help incent people and make them 
understand, hey, there is not only a job here but a bright 
future that can change the way you look at the world.
    Mr. COSTELLA. Just on that note with STEM careers in 
general, one of the things we have seen some major success with 
is employers themselves taking the responsibility to 
communicate what we do. Historically, we have just assumed that 
counselors and teachers and everyone knows what we do and they 
will somehow drive people magically into our factories and we 
will all be happy. Well, if we do not open our doors and we do 
not ask students and parents and teachers and folks to come 
through our facilities, whether it is in the IT world or 
manufacturing, they do not know any better. And what we have 
seen is when we do that it does significantly increase the 
likelihood that people want to pursue these careers. And then 
if you can attach to that sophisticated marketing and 
advertising and fund that through kind of associations and 
whatnot, you actually can make some inroads.
    Ms. MENG. Thank you, Mr. Chairman. I yield back.
    Chairman HANNA. Ms. Clarke. You have five minutes or a 
little more if you like.
    Ms. CLARKE. Thank you very much, Mr. Chairman. And thank 
you, Ranking Member Meng. And I would like to thank our 
witnesses for your testimony here today.
    I want to refer back to a point that was raised by you, Mr. 
Tyler. You spoke about the barrier to H-1B visa employees to 
establishing a business in the United States. What would you 
see as a remedy for this challenge to a nonresident, noncitizen 
entrepreneur?
    Mr. TYLER. It may not be necessarily changing the H-1B 
itself, but actually creating a new visa class that would allow 
for entrepreneurial visas. And there have been a couple of 
various bills introduced to do these sorts of things. But to 
more specifically allow foreign----
    Ms. CLARKE. Nationals?
    Mr. TYLER.--nationals to start and grow companies and to 
allow H-1B recipients to transition into that status or to 
allow foreign nationals to enter that status directly.
    Ms. CLARKE. So what would that business be classified as? 
Would it be an American business or what type of business would 
it be?
    Mr. TYLER. The presumption is that it would be an American 
business starting in America, and presumably, one of the bills 
requires that you hire various numbers of people, nonfamily 
members, in jobs in America. But I would not necessarily want 
to say that the business could only operate in America. In 
today's global economy it is important for growth and 
opportunity that if a business can, in fact, be multinational--
--
    Ms. CLARKE. I just think that this is sort of a new 
paradigm.
    Mr. TYLER. True.
    Ms. CLARKE. Right. And it is an intriguing one because I 
certainly understand the global nature of business these days, 
but one of the challenges has been I guess American employment.
    Mr. TYLER. Correct.
    Ms. CLARKE. And so the question becomes are we ready to 
embrace that new paradigm or in the alternative, do we provide 
a pathway to either residency and/or citizenship for H-1B visa 
holders? Have you given any thought to that?
    Mr. TYLER. Well, in some ways--and there are studies that 
show that right now the alternative for a lot of these folks is 
not to start their companies in America; it is to leave America 
and start their companies somewhere else. So they go back to 
their home countries and they start and grow their companies 
there. And a lot of these countries are very eager and they are 
very intentional and strategic about trying to recruit these 
people back to their country.
    Ms. CLARKE. Right. Part of the challenge is the brain 
drain, right?
    Mr. TYLER. Correct.
    Ms. CLARKE. Of any of these nations. So what I am saying is 
in terms of ultimately anchoring someone in the United States. 
We want the talent. We want the business. There is a tension, a 
natural tension between a national of another nation and the 
United States in terms of that talent, right? So I am trying to 
get a sense of just in terms of creating this new paradigm, if 
you will, is what is it that we would use as I guess the 
magnet? Is it to become on a pathway to becoming American? Or 
is it just sort of a global, this is a good place for you to 
start a business mentality? And I will open that up for the 
rest of the panel because I am just trying to get a sense as we 
go through reform or what I call a new system, how we would 
manage that.
    Mr. TYLER. Well, America continues to be the best place to 
start and grow a company, and we need to retain that status. 
And I think if we allow opportunities for foreign nationals to 
start and grow their companies here, not necessarily--or not on 
temporary visas--maybe provisional, but certainly permanent 
residency at a minimum, in starting and growing a company you 
are attracting capital, you are attracting talent, you are 
attracting customers and suppliers. A temporary status adds 
risk, a high degree of risk to an already risky venture.
    So in addition to the ecosystem that supports starting and 
growing businesses for the foreign national and their ability 
to start and grow their business, to hire people, there needs 
to be some degree of certainty around their status.
    Mr. REED. I wanted to give you a quick specific answer. As 
you know, the president supported something called the Start-up 
Visa Act of 2013, and I was using my handy dandy mobile device 
to make sure who the sponsors were. But it gets to the heart of 
your question--how do we find a way to bring them in? You 
mentioned the brain drain. Well, the good news is so far the 
brain drain has worked in our favor. Folks have come to 
America. We have been the beneficiary of it. So you are right. 
It acts like the Startup Visa in finding ways as part of the 
immigration reform bill. Any form of immigration reform that 
helps us continue to win the brain drain war is absolutely 
essential. And so I would encourage you to look at some of the 
suggestions through the Startup Visa Act that the president has 
supported and others.
    Mr. COSTELLA. I would just say we do not really deal with 
the H-1B visa specifically but as a manufacturer that is 
growing, that has a really intense design capability, we want 
the best and brightest in the world to come here to live, to 
work in our companies, to build their families, to pay taxes, 
and we do not want to educate them here in our universities and 
then sit across the negotiating table from them. We want them 
on our side of the negotiating table. So whatever can be done 
to allow that to happen, and that is what you all are diving 
into, that is something that I think small- and medium-size 
businesses in general are probably supportive of.
    Ms. MENG. Thank you very much. Mr. Chairman, I yield back.
    Chairman HANNA. Thank you.
    Ms. Chu, are you prepared to ask a question?
    Ms. CHU. Yes.
    Chairman HANNA. Go ahead.
    Ms. CHU. Mr. Reed, I have heard--well, actually maybe for 
the whole panel, I have heard many of you address the solution 
for STEM job shortages via immigration reform, but no one has 
mentioned the large pool of potential STEM workers that are 
women. Currently, women hold less than 25 percent of STEM jobs 
and as discussed by many of you directing visa fees to bolster 
an improved STEM education at the K-12 level certainly is key 
to increasing the native STEM workforce population that we have 
for the long term. But we also need to make sure that some of 
this money is directed at increasing the number of women 
getting STEM degrees.
    So in what ways could we do that--could we increase the 
presence of women in STEM jobs and therefore increase the 
supply of STEM workers to alleviate these shortages?
    Mr. REED. Well, I will start with a little bit of a 
personal side of the story. My wife is actually a veterinarian, 
so she is actually a STEM professional and went through school 
to take math and science classes all throughout and become a 
doctor. And I watched her class over the time that she has been 
in it. Veterinary medicine, for example, started out with 
almost all men. Her class when she graduated had 90 students. 
Four, I think, were men; the rest were women. So we are, in 
fact, seeing a lot of women in medical professions and others 
that are, in fact, STEM-based, that are heading towards women. 
I believe the last statistic I saw was that there were more 
women in medicine--in medical school right now than there are 
men.
    So I think it is good to see that growth, but you point to 
something a little more specific, which is my industry, the 
software industry, where we are not still seeing the growth. 
And I think it is absolutely worth looking at to find ways to 
increase the diversity through how we spend the money that 
comes out of the H-1B program. I think there is a lot to learn 
from some of the nonprofit work that has already been done and 
we should use that as we figure out the best way to utilize the 
spending.
    Mr. RAVINDRA. I would like to add, yes, there is certainly 
a shortage of women in the engineering field and also a 
shortage of high school students going into engineering. So 
definitely we need to increase the awareness among high school 
students and also train the high school guidance counselors to 
introduce STEM-related fields to let them know that the kids 
have a future in them. So it definitely needs to be introduced 
at the high school level to encourage girls to go into 
engineering.
    Ms. CLARKE. Mr. Costella.
    Mr. COSTELLA. One of the owners of our company is a woman. 
Our director of communications and our director of technical 
communications are women. Our director of business process is a 
woman. And one of the things that we find extremely important 
is making sure that when we engage with schools, both letting 
parents and students and folks into our factory, visiting 
schools for career fairs, is to show that our sector is not 
just putting parts together. There is a whole slew of jobs that 
are interesting. And showing the folks who are in leadership in 
our company who are women, having them go out and be the 
spokespeople, too. It has a tremendous impact in inspiring 
young girls that these are careers that they can have. And so 
again, I go back to I think the answer lies with the employers 
taking responsibility and taking this seriously enough. If we 
do not engage, I do not see how you build a pool of interest 
that is sustainable.
    Mr. TYLER. Yeah. And I would add I think that your question 
is very astute and I would add to not just women in STEM fields 
but women in entrepreneurship, women who grow companies. There 
should be more of them and we need to have more of them. But 
there is also evidence that the number of women who have 
started growing companies is growing. And I think at the 
Kauffman Foundation, we are trying to engage in one particular 
set of programs how do we do that better? How do we as a 
foundation facilitate the entry of women into STEM fields, 
entry of women into entrepreneurial fields and their ability 
not just to enter, but to succeed in those fields? So 
supporting groups like Astea, which provides women mentors to 
women entrepreneurs, trying to identify those women who can be 
role models, who are role models, and to do more to support 
them in their efforts to demonstrate that this is an excellent 
path for women.
    Ms. CLARKE. Thank you.
    I yield back.
    Chairman HANNA. Something maybe a little more contentious, 
we have limits from certain countries on the total numbers of 
people who can immigrate to the U.S. Knowing what we know about 
STEM and how important STEM is to the future of this country, 
and we have a lot of anecdotal evidence that suggests that when 
people come here, if they cannot get a visa within a certain 
period of time they actually go back and become our 
competition, do you think we should set visas based on skill 
sets as opposed to just raw numbers?
    Mr. REED. Obviously, I am going to sound like a broken 
record. That is exactly right. We are looking for the right 
person, and we do not care what country they come from, what 
accent they have. We want the person with the skill set that we 
want. So absolutely. We see a need to change the perspective 
basing it on the border versus basing it on the talent. And I 
think you are exactly right there.
    Mr. TYLER. And it seems arbitrary that Malawi or 
Lichtenstein would have access to the same 7 percent of EB 
series visas that countries like India and China and European 
Union countries have. The number is arbitrary. The application 
of the system in that regard is arbitrary. And it sure seems 
like there are a lot better ways to do it that would be 
particularly tied to opportunities, to needs, to skill sets, to 
education levels that folks in the countries may have.
    Chairman HANNA. So there is a fundamental logic for this 
country to pursue immigration policy that perhaps acknowledges 
the fact that there are certain people we need more of, and 
those for this moment in history are people who are educated in 
STEM.
    Can any of you give me some real life evidence of somebody 
you knew, maybe a company you know of, that came here and could 
not get a visa in time, so they took their knowledge and their 
skills and built a business overseas that is perhaps our 
competitor today?
    Mr. RAVINDRA. I can speak about that.
    Not necessarily because they did not get a visa or they 
were not able to stay here, but what we need to do is we need 
to attract the best and the most talented people to come to the 
United States, stay on, and then continue on to start 
businesses and that will be to our benefit. So I do know that 
many of my classmates who came here and did start businesses 
but did go back to my home country, India, and continue to 
expand and establish bases outside the country, it is just 
global economy. So whatever they thought for their business 
that it would be beneficial for them to be in India instead of 
being in the United States, they pursued that. So not because 
they were not able to obtain the visa or anything.
    But lately things are changing because, like I said, when I 
first came here to this country 20-30 years ago I got my green 
card within nine months, so that is a big difference. Today, 
for a student to get a green card it takes eight years for 
somebody from my country. So there is definitely--the person is 
going to think about it and then say, hey, you know, if there 
are opportunities elsewhere in other countries as good, why 
would I want to stay here? So that person would think very 
seriously about staying in this country and go outside.
    Chairman HANNA. To follow up with that, and I am going to 
read you something--I will ask the question quickly.
    So we are the competitive place to be. People want to start 
businesses here. We have great educational systems here. And to 
your point, if it takes nine years, people are going to think 
twice about whether or not they should even bother. But this is 
from David Brooks, a columnist from the New York Times, ``In 
the 21st century, the U.S. will no longer be the big dog. Human 
capital will be more broadly dispersed. There will be an array 
of affluent nations fully engaged in a global economy. Their 
competitiveness will be more about organizing relationships and 
amassing force to thrive. America will need to have to be the 
crossroads nation where global talent congregates and 
collaborates.''
    So if we do not get ahead of this dynamic that you 
describe, we will not be that country at that global 
crossroads. Would anyone like to comment on that?
    Mr. RAVINDRA. That is correct. As a matter of fact, many 
other countries, like the European countries, are jumping ahead 
and then giving research to very talented people in STEM, 
inviting them over to their countries with open arms compared 
to the United States. So they recognize that. So the European 
countries have already started recognizing the need for it.
    Mr. TYLER. And I would add not just European countries but 
also your neighbor to the north, Canada, is aggressively 
pursuing U.S. castaways, if you will. They have new visas that 
they make available. They have expedited processes that they 
make available. Australia, New Zealand are being aggressive. 
Japan. I mean, any number of countries. I mean, Japan, which 
had formerly been mostly closed to immigrants, is now 
recognizing value in attracting----
    Chairman HANNA. So, Mr. Tyler, would you say then, we are 
losing our ability to attract these people; a lot of it is 
because of our own bureaucracy and of course the whole other 
issues around immigration. How long do you think this dynamic 
can go on before we are looked at as a place that is too 
formidable to try?
    Mr. TYLER. Predicting the future is always risky. I would 
suggest that with the degree of attention that other countries 
are paying to this issue and the aggressiveness with which they 
are pursuing talent and not just the countries we have 
mentioned but also China and India who we are educating a lot 
of their talent and a lot of their workforce and a lot of their 
entrepreneurs. Not only do we have to change how we are doing 
business as a nation because it makes it more attractive, but 
we have to do it more aggressively because other countries are 
not just being more welcoming for U.S. educated students but 
they are making inroads in having a more friendly business 
climate where there are more opportunities for advancement, and 
even wealth creation, to degrees. And those opportunities 
become, you know, on one hand an opportunity for the U.S. 
economy given the global marketplace, but on the other hand, if 
we do not pay attention, we do not pay attention quickly, it 
becomes a threat to the U.S. economy.
    Mr. REED. I will give you a specific one and that is Kunal 
Bahl who created a company called Snapdeal. I am looking at the 
article where it talks about it. He now has 400 employees. He 
is in position to take on Groupon, and he specifically said his 
H-1B visa expired in 2007 and he returned home to India now to 
create a company called Snapdeal. The headline on the article 
is great. It says, ``At a time where the U.S. could use all the 
tech jobs it can get, Kunal Bahl is creating hundreds of them 
in India.''
    Chairman HANNA. Amazing.
    Mr. COSTELLA. And I would just add, at least from the 
manufacturer's perspective, we are kind of there. There is a 
shortage of people today in skilled STEM careers, as many as 
600,000 across the country according to some estimates. It is a 
problem and I appreciate that we want to look forward and be 
ahead of the curve. I think we are at the curve and not 
figuring this out will be detrimental to our future. I really 
believe that.
    Chairman HANNA. Innovation technology can facilitate new 
domestic jobs in industries or make it easier to transfer jobs 
overseas. Besides improving STEM education, what else do you 
think we can do to keep jobs here with knowing that all the 
uncertainty by government in terms of regulation and taxes and 
everything else? I know it is a big question but Mr. Reed, you 
are smiling.
    Mr. REED. The size of that question is pretty daunting. 
Obviously, from the small business perspective----
    Chairman HANNA. You ask questions.
    Mr. REED. Yeah, I know. You get the opportunity.
    From the small business perspective we have several issues 
from the technology part that we need to look at. We do have a 
lot of uncertainty right now with regards to regulation around 
other issues. Privacy is one that you heard mentioned earlier. 
But as we have to build these companies here in the United 
States, making sure that we can get the right person quickly 
and be able to pivot--one of the biggest--the biggest things 
that we have learned in the last five to six years over the 
mobile apps economy is it is not just about having the smartest 
person; it is having the smartest person who can change 
direction because the market changes.
    Eight years ago there was no such thing as the iPhone. 
There was no mobile apps economy. So in a matter of years we 
have created something that will hit about $100 billion by 
2016. So when you look at barriers to entry and barriers to 
success, a lot of it has to do with where there is either a 
government or other impediments that get in the way of a good, 
fast pivot.
    Mr. TYLER. And part of what could be done to alleviate that 
is just in looking at the amount of regulation that current 
exists. And too often regulation gets adopted and it stays on 
the books without any real effort over time to evaluate is it 
still right? Does it still make sense? Should we do away with 
this regulation? What is the effect? Just because a regulation 
was adopted 15 years ago not only does not mean that it still 
makes sense today but it may actually be causing harm today 
when it may have been the right thing 15 years ago. So there 
needs to be a more concerted effort to review regulations, and 
I would suggest at all levels of government, not just the 
federal level, but state levels as well. And to evaluate the 
regulation--what is the effect of this regulation not only 
based on the original intent and purpose of the regulation but 
what harm is it causing now? What harm is it likely to cause in 
the future? And are the benefits, you know, which comes in more 
important--the benefits to be gained or the harm that is 
caused? And a lot of that harm that is caused is increasing the 
expense associated with starting and growing businesses.
    Mr. COSTELLA. And as a small business that is part of the 
aerospace and defense supply chain, for example, one of the 
things that we have worked very hard in our engagement on the 
Hill is to try and educate folks that while the regulation may 
be well intended, it oftentimes impacts of customers. And a lot 
of people do not realize a lot of small businesses, their 
customers are the big OEMs, like a GE or a Boeing or a 
Lockheed-Martin or a Northrop Grumman. And so while there may 
be regulations that impact those guys at the top, there is 
rarely very much analysis about how it impacts the second and 
third and fourth tier suppliers down the chain like us. And we 
employ people with those good, high paying jobs that if through 
the stroke of a pen a program is just wiped out or some sort of 
regulation is put in place that adds a tremendous amount of 
cost, that does not affect the big guys; that comes right down 
the chain to us. And at some point it becomes not sustainable 
and it gets kind of scary. So I would say the cognizance of the 
entire supply chain and how decisions here, which I truly 
believe are well intended in many respects, how do they 
actually impact the guys on the front lines?
    Chairman HANNA. Thank you.
    Mr. RAVINDRA. Being in the construction industry I just 
want to add that obviously, the investment in infrastructure is 
a good way to improve business climate in the country. And from 
what I know, any place in other countries, especially like for 
example, India, speaking from my personal experience, building 
a good, nice airport in my hometown, paved the way for major 
improvements and major investment by private sector all around 
and all the way to the town, filled with technology companies 
that took advantage of the investment.
    Chairman HANNA. Thank you.
    Ms. Clarke.
    Ms. CLARKE. Thank you, Mr. Chairman. Excuse me.
    I would like to refer back to a question actually raised by 
Congressman Hanna, and that is given that there is legislation 
that would lift the statutory cap on overrepresented countries, 
do you find that would be a sufficient answer to the employee 
shortages that we face? Or would you be in favor of a removal 
of caps all together?
    Mr. TYLER. I think----
    Ms. CLARKE. Did you kind of get where I was going with that 
question?
    Mr. TYLER. If I understand the question, you are asking if 
eliminating the per country cap in the AB series visa, is that 
going to solve the need for talent? I would suggest that it is 
a component of solving the need but it is not going to be 
sufficient to solve the need because the EB series visas, they 
are still--if you eliminate the per country cap, there is still 
the numeric caps that exist as well and those numbers are 
relatively small for each of the series. And even looking only 
at the EB series is not likely to solve the workforce needs.
    Mr. REED. I agree. If you look at the raw numbers, the fact 
that we hit the cap in a matter of days, it is interesting to 
note that in 2009, which we have to argue is the worst economic 
condition that this country has faced since the Great 
Depression, we still used up all the H-1B visas. So at a 
certain level we have to understand that the cap itself needs 
to be expanded and eliminating the per country is going to be 
important to doing it.
    Ms. CLARKE. So then you are saying lift the cap or remove 
the cap? Or----
    Mr. REED. Ultimately, I am very pragmatic about this. I 
want solutions that help my members, and so removing the cap 
would be great but I am also very cognizant of the needs of 
Congress to meet compromise levels. So at best, let us get it 
raised first and then we can revisit the question of removing 
it all together.
    Ms. CLARKE. So I heard the number 600,000 currently in the 
shortage of people with the expertise. If we are raising the 
cap, I mean, where is the sweet spot there?
    Mr. REED. Well, I think we have looked at numbers more in 
the 120,000 range versus where we are right now, and I know 
that Kauffman can speak to the specific numbers on that. But 
overall, you are right. Even a lift of the cap will not 
eliminate our shortage, but that is why we want the money to go 
to STEM so at the same moment that we are raising the cap, we 
are also getting Americans who are capable of filling those 
slots prepared immediately through community college efforts, 
through afterschool programs, through every level of the 
education system so that at the same time we are lifting the 
cap, we are also bringing Americans into those jobs.
    Mr. RAVINDRA. I just want to add I would be for removing 
the cap because for the primary reason, as an employer, when I 
am looking for employees, I am looking for certain skill sets 
and I am also comparing the foreign students and graduates with 
the local workforce available, and I want to hire the best. So 
the market will dictate. If you remove the cap and if the 
market is flooded with too many foreign graduates and if the 
companies have an abundant supply and then they are going to 
hire the best and the remaining will ultimately go home anyway. 
So I do not think removing the cap is going to hurt us.
    Ms. CLARKE. Very well.
    One final question, Mr. Chairman. Can you provide us with 
an idea of the diversity of the potential foreign candidates 
with STEM degrees that you are finding in the aggregate 
candidate pool? I mean, where from around the world are we 
talking about? Is it just every nation? We certainly know of 
India and China. I heard the E.U. also mentioned but they are 
our main competitor right now. I just do not see people rushing 
out of the European Union unless I guess financially there is 
an incentive. But what are we talking about here?
    Mr. REED. Actually, we have been able to get some good 
talent out of Ireland. Their economic situation, they have a 
great education system in Ireland. They have produced some 
really skilled software engineers over there. And you are 
right. We are willing to pay more. And that is not a bad thing 
necessarily if we get the right talent. So I think it is good 
that we face off against our competitors like Ireland, like the 
E.U., and say come to America. If you are better, smarter, or 
faster, we would love to have you here to help create jobs. So 
it is all the way around the world but we should never take our 
eye off the places that are directly competing with us.
    Ms. CLARKE. I yield back, Mr. Chairman.
    Chairman HANNA. Ms. Chu, do you have a question?
    Ms. CHU. Yes. I wanted to ask specifically about the Senate 
bill that is before us on comprehensive immigration reform.
    Mr. Reed, you pointed out that simply increasing the H-1B 
cap will be not enough to solve the STEM worker shortages that 
we are facing, and you stated that not everyone can fill this 
gap and that for vulnerable technology startups that the right 
fit is very critical.
    The Senate immigration bill would add an additional 120,000 
merit-based visas for high- and low-skill immigrant workers 
annually. And I am just wondering what you think about this. It 
would give extra points to immigrants with masters degrees and 
Ph.D.s, and those with experience working in high demand fields 
would also provide--it has a potential for providing small 
businesses and startups with the skilled employees that they 
need. Outside of increasing H-1B or employment-based visa 
categories, would this improve the chance of finding the right 
fit candidates?
    Mr. REED. Congresswoman, I believe that there are quite a 
few benefits that we are seeing in the Senate bill. I have to 
say that we find the I-Squared legislation as proposed to 
definitely have some advantages over the Gang of Eight--I guess 
we can call it the Gang of Eight Senate version in that it is a 
little more pragmatic about some of the difficulties in making 
sure that we can get the right employee. There are elements of 
the Gang of Eight bill on the H-1B side that would put some 
pretty high burdens for a small startup company in terms of 
meeting their requirement that we have looked into every 
possible way to find an American, that we leave ourselves open 
to investigation by the Department of Labor for multi-years.
    So when you look at the Senate bill, to go directly to your 
question, does it solve all the problems? Of course not. We 
know that. We discussed that ad nauseam. We think that the I-
Squared language probably does a better job of dealing with the 
small business needs that are being considered elsewhere, and 
so we would encourage you to look at the I-Squared language 
around that portion. Overall, I think it is important that the 
other area that needs to be looked at is that right now the 
legislation in the Senate only apportions about 15 percent of 
its money to a secondary education. A lot of it goes right now 
to college, community colleges, which is great, but I think one 
of the things we need to consider is the fact to get that 
competent college student, like you talked about, getting them 
in the community college, they need the talent that Mr. 
Costella described--reading, writing, arithmetic. So we need to 
actually put some more of that money looking at the high school 
level, too.
    So as you look through that Senate bill, look at the I-
Squared on the H-1B requirements and look at where the money is 
going and ask serious questions about is there a way for us to 
put more into secondary education so that Mr. Costella's needs 
are met as well and that they have the math skill so that they 
can go through the journeyman program.
    Ms. CHU. Okay. Mr. Tyler.
    Mr. TYLER. If I would, I would add that it is important 
that immigration reform, particularly as it relates to the high 
skilled levels, and particularly in the area of small business, 
that we remember that high skilled immigrants have a greater 
propensity to start and grow companies. So it is not just a 
workforce issue; it is also an entrepreneurship issue and 
starting and growing companies, which actually then creates 
more demand for workforce. Creates jobs, creates opportunities, 
and creates product services, et cetera. So it important that 
there be opportunities for folks, as I mentioned earlier, for 
foreign nationals to come to the U.S. to start and grow their 
companies here. And also for foreign nationals who are here on 
temporary visas or other restricted visas to be able to have a 
pathway to starting and growing their business.
    Ms. CHU. Mr. Tyler, there is--in talking about the Senate 
immigration bill, it does have a provision that would improve 
the portability of visas, and in your testimony you mentioned 
that small businesses would particularly benefit from 
procedural changes to the law that allow for this portability. 
Could you expand on this point and explain why it would be 
important to you? How it would benefit small businesses?
    Mr. TYLER. Portability is important for a few different 
reasons. The absence of portability ties the immigrant to a 
particular company. It ties them to their sponsor. And that 
creates opportunities for below market wages, below market 
working conditions because of that specific tie to the 
employer, because if the person who is sponsored by the 
employer leaves that employment, they have to either leave the 
country or find somebody else to sponsor them. So having 
degrees of portability is important because it becomes a 
pressure against abuse of the system which is important. 
Portability also needs to encompass the possibilities of 
starting and growing companies as opposed to finding another 
employer sponsor. Starting a company and having that company 
effectively hire you becomes part of portability as well.
    Mr. RAVINDRA. If I may add, I was speaking to a friend of 
mine who owns a small business--not exactly a small business 
but a company of 200 plus employees. I asked him about how many 
H-1B visas he has hired and sponsored, how many employees, and 
he said none because the complexity of the process scares small 
businesses. And they really do not want to deal with going 
through the H-1B process to hire people and they will not just 
do that. And so simplification of the process is really 
critical for small businesses to hire H-1B visa graduates.
    Mr. COSTELLA. I would second that just as a smaller 
business. When we look at that it is burdensome to figure it 
out and understand all the details. So we will adopt our own 
measures of finding the right people, but simplifying that 
would help us access more talent, which makes us more 
competitive and helps us grow and create more jobs.
    Ms. CHU. Thank you. I yield back.
    Chairman HANNA. We talked a little bit about the Senate 
bill. Part of it, to protect opportunities and wages for 
domestic workers, the Senate bill includes provisions that 
would require employers to pay H-1B visa employees higher 
wages. Would anybody like to speak to that?
    Mr. RAVINDRA. I can speak a little bit about it.
    When we sponsor an employee for the H-1B visa in talking to 
our counsel, they advised us that we need to pay the prevailing 
wage, which is whatever the average rate of pay is for that 
employee and not pay any less than that for the chances of that 
employee to get their visa. So we cannot really go and hire 
foreign graduates assuming that we can pay less and then make 
money out of that. So we do not do that. And also, our counsel 
told us that the rate of pay has got to be on par with anybody 
that we would hire.
    Chairman HANNA. So basically you would say then the Senate 
provision is irrelevant; that it is unnecessary?
    Mr. REED. I would say that right now I know that being on 
the software side it is a little different than my colleagues 
here at the table but we are not finding that people are saying 
no to hiring the right talent because it is slightly more; in 
fact, we are actually looking at wage competition in the other 
direction which is trying to keep our best employees in our 
company by doing anything we can, including salary increases. 
As we all know, those are going up. So it is not really 
relevant to us right now in the software sector.
    Chairman HANNA. What you are really saying is the market 
has taken care of that.
    Mr. REED. Absolutely.
    Chairman HANNA. Okay.
    Mr. TYLER. Mr. Chairman, if I might add on the compensation 
side of things, small businesses have a tendency to compensate 
their folks in a lot of different ways. It is not just salary.
    Chairman HANNA. Oh, is it?
    Mr. TYLER. Exactly. So it is salary but there are bonuses 
that come into play, and a lot of times, particularly with very 
small businesses or even growing small businesses there is 
equity that can be part of the compensation. As I understand 
it, the prevailing wage calculation, the immigrant calculation 
of market wages is salary based. It does not account for 
bonuses. It does not account for equity. Now, equity is hard to 
value, and particularly in a small company and a closely held 
company, but at the same time there is value there and that can 
be an important aspect of the compensation.
    Mr. REED. That is actually, and I apologize for not even 
thinking about bringing that up, that is actually probably one 
of the most critical areas for us. If Congresswoman Meng had a 
great idea and she and I wanted to start a high-tech firm and 
we had the change rattling around in our pocket, the way that 
she would be compensated for her brilliant idea and all of her 
successful output would be stock. Would be some other 
compensation--equity in the firm. And when you take that away 
from us it makes it a small business--it gives us--chops us off 
at the knee a little bit when we are going up against a much 
larger company that can do it all through salary. So 
absolutely. Thank you for bringing that point up.
    Chairman HANNA. Let me reverse the notion a little bit, the 
question.
    On our current laws, and we all know immigration is on the 
table now. A lot of people are hopeful that by September we 
will all have something settled. But in the absence of that or 
if we wind up with more of what we have, how long would it take 
to build up our own indigenous workforce to fill the types of 
jobs that you gentlemen see coming down the pike knowing what 
Mr. Reed said earlier, and that less than 10 percent of the 
schools are focusing on information technology education types 
of individuals, how reckless is it for us to stay on this path, 
and what are the long-term consequences if we do not change our 
policies?
    Mr. REED. I know Rob Atkinson at ITIF has done quite a bit 
of looking at the innovation economy in looking at how many 
jobs we will be down if we continue on this course. And I have 
seen numbers as high as 900,000 or more for in the innovation 
economy sector. I know that Kauffman Foundation has also done 
some work on this. But we are talking millions, and at least at 
least from the software side, at least a million.
    Mr. COSTELLA. I would say that in terms of the timeframe to 
turn it around it is not going to happen fast. There are so 
many facets that we have learned in our work. I mean, we were 
able to, because of our very strong partnerships with the 
workforce system in the state of Nevada, the governor, the 
higher ed system as a whole, the K-12 system, we were able to 
put together a program to meet an immediate need for machine 
operators in fairly short order, but that does not answer our 
need for journeymen level machinists. By the time there is a 
shortage of some of these really skilled people, which we will 
notice in the next five to seven years, it takes me five years 
to train a journeyman level machinist. If we wait till the 
shortage hits it is too late. You cannot find those folks. You 
cannot train them. And so there is no immediate solution, and I 
cannot emphasize enough, as I think I have been doing, the role 
of employers to be proactive. I guess I am singing to 
ourselves. We have got to engage and be proactive in this 
conversation. There are things that can be done at the federal 
level from a policy perspective to simplify and to get this 
right. But we have to be the boots on the ground, to be clear 
about what we need. We have to engage with the community, with 
students, with parents, with teachers, to make sure that these 
careers are viable options. And without those pieces all coming 
together I just do not know where the solution is going to come 
from.
    Mr. RAVINDRA. I just want to add we really need to look at 
long-term benefits of investing in STEM and investing in 
encouraging high school students to get into STEM. So whatever 
we do, we need to be looking at long-term investments, long-
term--the benefits are going to be 10, 15 years from whatever 
we do today is when we benefit. So it is really easy to turn 
around and look for short-term gains in any field, even the 
companies look for quarterly returns, and then if they stop 
looking at the long-term investment and long-term growth aspect 
of the business they lose out.
    Mr. TYLER. Mr. Chairman, I would offer a couple of points. 
One, the importance of education and educating our native-born 
population cannot be understated. It is not just a workforce 
issue, it is not just an employment issue. It, in fact, affects 
the future of our democracy. Educated citizenry is essential to 
the functioning of our nation. If we continue to neglect that 
we are continuing to neglect our nation in those sorts of ways 
in addition to the workforce issues.
    A second point is that even if we had a completely educated 
native-born workforce, there would still be needs to bring in 
foreign nationals, not necessarily to supplement the expertise 
and the skill sets, but if nothing else but to provide new 
ideas and new insights because in the global economy, American 
businesses are reaching out into some of the least strange 
places of the world, like European Union, but they are also 
reaching out to what might be strange places in the world, to 
understand cultures around the world, to understand frankly 
just how a product is used, much less the interaction with the 
potential customers, customs with suppliers, having access to 
that information, we are not going to be able to grow it at 
home. We are going to need to access it from abroad.
    Chairman HANNA. Thank you. Thank you all.
    Are there any further questions?
    We have a couple of minutes, and a lot of times in these 
hearings the right questions do not come out and there are 
things that people would like to say and they do not 
necessarily have an opportunity to say. So we have got a few 
minutes if anyone would like to add to the conversation.
    Mr. COSTELLA. I would just say, reiterate from my opening 
remarks, that when we talk about STEM skills, a lot of people 
automatically think NASA engineer or something, and those are 
STEM jobs. But from the perspective of small- and medium-size 
businesses, it is the basics. It is reading, writing, math, 
problem solving. If we can get across that bar then we 
companies are happy to train and develop people. It is very, 
very normal for a company like ours to make substantial 
investments in developing and cultivating talent from the start 
all the way up through the senior levels of the company. So I 
just hope we do not think STEM is the separate kind of entity 
out there that is different than the basics. It is the basics 
and then all the way up.
    Chairman HANNA. Sure. So knowing that people change jobs 
seven or eight times in their lifetime, knowing that what once 
was true, that you could have a set of skills today, but you 
need a long-term set of skills that you keep up with throughout 
your life to stay competitive and that if we are going to build 
a thriving middle class in this country, and rebuild this 
country in a way that provides a positive future for all of us, 
and reduces our high unemployment and this enormous debt that 
we are facing, we need to focus on STEM.
    With that, I would like to thank you all for your time 
today. It has been very valuable. And again, I know you go 
through long distances and a lot of work to get here.
    I ask unanimous consent that members have five legislative 
days to submit statements and supporting material for the 
record. Without objection, so ordered.
    This hearing is now adjourned. Thank you.
    [Whereupon, at 11:49 a.m., the Subcommittee was adjourned.]
                            A P P E N D I X


     Testimony for Hearing on STEM Workforce and Immigration Reform


           Before the Contracting and Workforce Subcommittee


                    Of the Small Business Committee


             Of the United States House of Representatives


                      John Tyler - April 25, 2013


    Introduction and Context

    Good morning. My name is John Tyler and for the past 14 
years I have been the General Counsel and Corporate Secretary 
for the Ewing Marion Kauffman Foundation in Kansas City, 
Missouri. The Kauffman Foundation is among the largest private 
foundations in America and our focus is on fostering economic 
independence by promoting entrepreneurial success and 
educational achievement.

    As you know, small businesses and in particular young 
businesses have been a significant driver of job growth in our 
nation. Kauffman research shows that most net new job creation 
has historically come from businesses that are less than five 
years old.\1\ Small and young businesses also are a substantial 
contributor to our nation's economy and a major source of 
innovative products, services, and processes that have not only 
contributed to our economy but also to our ways of life. As 
such, it is imperative that U.S. policy support opportunities 
for small businesses and especially that entrepreneurial subset 
whose businesses are positioned for the transformative growth 
that keeps our nation's economy vibrant. I refer to these 
collectively as ``small business'' in this testimony.
---------------------------------------------------------------------------
    \1\ See Dane Stangler and Robert Litan, Where Will the Jobs Come 
From? (Ewing Marion Kauffman Foundation, November 2009).

    Among current policies that do not provide enough support 
for those opportunities is a U.S. immigration system that does 
not give enough consideration or support to economic priorities 
and opportunities that immigrants provide. The STEM workforce 
---------------------------------------------------------------------------
is particularly at risk of being neglected.

    Demand for STEM jobs has been growing,\2\ but STEM 
businesses are being squeezed from one end by the large number 
of STEM-skilled people leaving the field because of retirement 
\3\ and from the other by the decreasing number of native-born 
talent with the requisite level of knowledge and expertise who 
are entering the field.\4\ Although these problems affect our 
economy and innovative capacity more broadly, they present 
distinct challenges for small business.
---------------------------------------------------------------------------
    \2\ Peter Schuck and John Tyler, Making the Case for Changing U.S. 
Policy Regarding Highly Skilled Immigrants, 38 Fordham Urban L. J., 
327, 359-41 (2010) (citations omitted).
    \3\ See National Science Board, Science and Engineering Indicators 
2010, NSB 10-01, chapter 3, p. 29 (National Science Foundation, 2010); 
Peter Schuck and John Tyler, Making the Case for Changing U.S. Policy 
Regarding Highly Skilled Immigrants, 38 Fordham Urban L. J., 327, 339-
41 (2010) (citations omitted). Dowell Myers, Thinking Ahead About our 
Immigrant Future: New Trends and Mutual Benefits in our Aging Society, 
(Immigration Policy Center, American Immigration Law Foundation, 
January 2008); Jacob Funk Kierkegaard, The Accelerating Decline in 
America's High-Skilled Workforce: Implications for Immigration Policy, 
Policy Analyses in International Economics 84, p. 1 (Peterson Institute 
for International Economics, December 2007).
    \4\ Peter Schuck and John Tyler, Making the Case for Changing U.S. 
Policy Regarding Highly Skilled Immigrants, 38 Fordham Urban L. J., 
327, 340-41 (2010) (citations omitted).

---------------------------------------------------------------------------
    Small Business Vulnerability Under the Current System

    As this Committee knows and understands, small businesses 
frequently operate on limited budgets and personal sacrifices 
of people driven by passion for their business' purpose, 
particularly during their early stages. Their very survival--
much less growth--can depend on the ability to attract and 
retain the right talent with the right skillsets and experience 
at the right time.

    Thus, small businesses in STEM fields are particularly 
vulnerable to the talent squeeze and workforce issues. The 
current immigration system too often leaves small businesses at 
the mercy of an expensive process with too many businesses 
competing for too few visas that take too long to process. 
Large established businesses are better able to dedicate 
regular financial and personnel resources to manage through the 
expense and bureaucracy of meeting their workforce needs. For 
example, one explicit way in which the system favors large 
business is that, because of their resources and regularity of 
engagement, they are more likely to be recognized as ``trusted 
employers'' for purposes of expedited processing. Even so, the 
current system does not meet the workforce needs of big 
business either.

    Policy Change Recommendations

    Changes in U.S. policy regarding immigration could 
alleviate the vulnerability of small business to certain 
workforce issues. As a result, firms may be more likely to 
survive past the early years and become growth firms. More 
firms and more growth will mean more jobs, more innovation, 
better standards of living, and advances in human welfare just 
as we have experienced in prior decades.

    A 2010 article by Malcolm Goeschl highlights some of the 
challenges that small companies and startups face when trying 
to hire prospective non-native employees. Among these 
challenges are what Goeschl asserts was an apparent USCIS 
presumption that no company with 25 or fewer employees, annual 
gross income of less than $10 million, and/or less than 10 
years old could have legitimate visa needs.\5\ Such a 
presumption--whether actual or in practice--hurts small 
business.
---------------------------------------------------------------------------
    \5\ See Malcolm Goeschl, An Attack on Entrepreneurialism: A Review 
of USCIS Adjudication of H1-B Petitions for Startups and Small 
Companies in 2009, 87 No. 7 Interpreter Releases 369 (February 15, 
2010).

    In addition, there are three key types of changes that will 
help small business and their contributions to the American 
economy: changing the total of available economically oriented 
visas, adding at least one new visa type, and changing 
---------------------------------------------------------------------------
processes by which applicable visas are awarded.

    Increase Number of Visas Available

    With regard to quantity, there are any number of general 
increases that, by helping all business will also help small 
business. Among these are the following: (1) increase the 
annual number of H1-B visas so that supply better matches 
demand and (2) remove or at least increase the national caps on 
employment-based series visas. Data shows that increasing the 
number of H1-B visas has a further effect on job creation as 
studies show that an average of between 2-5 additional jobs are 
created in connection with each H1-B hired.\6\
---------------------------------------------------------------------------
    \6\ See Madeline Zavodny, Immigration and American Jobs, American 
Enterprise Institute and The Partnership for a New Economy (December 
2011) (immigrants with advanced degrees from U.S. universities in STEM 
fields creates average of 2.62 jobs); National Foundation for American 
Policy, H1-B Visas and Job Creation (March 2008) (``for every H1-B 
position requested, U.S. technology companies increase their employment 
by 5 workers'' on average with the average increasing to 7.5 workers 
for technology companies with fewer than 5000 employees).

    More specific to small business and recognizing their 
unique circumstances, it may be appropriate to target a certain 
number of percentage of economy-oriented STEM visas for small 
business, based possibly on number of employees, overall 
revenues, and/or investment capital resources. This step would 
position small businesses to choose between competing with each 
other in this realm rather than with big business but without 
---------------------------------------------------------------------------
hurting big business.

    New Class for STEM Graduates of U.S. Universities

    Along with more visas, another change that would help small 
business by helping all business would be allowing foreign 
students who receive graduate or even bachelors degrees in STEM 
disciplines from U.S. colleges and universities to have a 
predictable, certain path to permanent residency, either by 
automatically providing green cards upon graduation or at least 
providing a temporary visa that automatically leads to 
permanent status upon satisfaction of certain conditions.

    These visas could have at least four outcomes beneficial to 
the U.S. economy. First, they would permit U.S. employers to 
more readily access this talent to help meet their employment 
needs. Second, these visas would presumably permit broad 
portability, which will help protect against below market wages 
and working conditions and permit professional advancement and 
enhanced contributions through promotions and job moves. 
Moreover, there would not be the same incentives to restrict 
portability in order to protect the initial employer's 
investment of funds to obtain a visa through current channels. 
Third, they would permit these visa holders to become small 
business owners and entrepreneurs themselves by starting and 
growing their own businesses, as studies show that high skilled 
immigrants are more likely to do.\7\ Finally, these visas would 
better position our nation to directly harvest the fruit of 
seeds sown by permitting access to the knowledge, experiences, 
networks, and other benefits of a high quality education at a 
U.S. college or university.
---------------------------------------------------------------------------
    \7\ A recent Kauffman Foundation study showed that immigrants are 
almost twice as likely as native born people to start businesses. See 
Robert W. Fairlie, Kauffman Index of Entrepreneurial Activity 1996-
2012, p. 10 (Ewing Marion Kauffman Foundation, April 2013). See also 
Anthony Luppino, John Norton and Malika Simmons, Reforming Immigration 
Law to Allow More Foreign Student Entrepreneurs to Launch Job-Creating 
Ventures in the United States, Ewing Marion Kauffman Foundation (August 
2012).

---------------------------------------------------------------------------
    Procedural Changes

    Although increasing quantities and adding a class(es) could 
help significantly, the benefits risk being minimized or even 
eliminated without changes in how visa applications are 
processed. The process is too cumbersome and time consuming for 
all business but is especially so for small business, which 
often is not engaged in the system with enough regularity and 
consistency to do so efficiently.

    A more specific procedural change would better account for 
the inherently changing nature of new firms, most of which are 
small businesses, by allowing for portability if the 
originating firm goes out of business. According to Census 
Bureau data, only 44% of firms founded since 2003 survive after 
five years.\8\ A person who is legally present on an H1-B or 
whose EB series visa is pending should not be penalized if the 
business that originally sponsored them closes. If the person 
has found similarly gainful employment or has started a valid 
business, the Service should be required to afford them 
presumptive legitimate status--not for their benefit 
necessarily but for the contributions they make to their new 
employer or business.
---------------------------------------------------------------------------
    \8\ Dane Stangler and Jared Konczal, Give Me Your Entrepreneurs, 
Your Innovators: Estimating the Employment Impact of a Startup Visa, p. 
4 (Ewing Marion Kauffman Foundation February 2013); Dane Stangler, The 
Economic Future Just Happened, p. 10 (Ewing Marion Kauffman Foundation, 
June 9, 2009) (setting survival to five years at 48-49%).

---------------------------------------------------------------------------
    Conclusion

    Other nations are increasingly eager to welcome high 
skilled and entrepreneurial immigrants, particularly those 
trained at American institutions of higher education.\9\ The 
United States' current approach to immigration makes it a lot 
easier for those nations to succeed in this regard. While it is 
true that stronger economies elsewhere can have tangential, 
indirect contributions for the U.S. economy and businesses, it 
should not be at the expense of opportunities for direct 
benefits for U.S. jobs, economic growth, innovation, and 
advances in human welfare. The changes proposed here better 
protect those opportunities, particularly for small business.
---------------------------------------------------------------------------
    \9\ See The Partnership for a New American Economy and The 
Partnership for New York City, Not Coming to America: Why the U.S. Is 
Falling Behind in the Global Race for Talent (May 2012); Vivek Wadhwa, 
et al., The Grass is Indeed Greener in India and China for Returnee 
Entrepreneurs (Ewing Marion Kauffman Foundation, April 2011); Chris 
Gafner and Steven Yale-Loehr, Attracting the Best and the Brightest: A 
Critique of the Current U.S. Immigration System, 38 Fordham Urban L. J. 
191 (2010); Peter Schuck and John Tyler, Making the Case for Changing 
U.S. Policy Regarding Highly Skilled Immigrants, 38 Fordham Urban L. 
J., 327, 336-39 (2010) (citations omitted).

    These proposed changes also position the United States to 
more actively benefit from the growing global ``brain 
circulation'' by which knowledge and innovation is increasingly 
shared among nations. Without these types of changes, U.S. 
participation is more likely to be one-sided--meaning that 
knowledge and innovation leaves but does not most fully benefit 
---------------------------------------------------------------------------
us by circulating back.

    Thank you for the invitation to submit this testimony and 
to be a part of the Committee's work on reforming U.S. policy 
regarding high skilled immigration. I look forward to your 
questions.
                                A C E C


               American Council of Engineering Companies


                        100 Yeras of Exxcellence


                Testimony of Mr. Nagappa Ravindra, P.E.


                              President of


                Ravi Engineering & Land Surveying, P.C.


              Before the House Committee on Small Business


               Subcommittee on Contracting and Workforce


                             April 25, 2013


    Chairman Hanna, Ranking Member Meng, and members of the 
committee, I appreciate the opportunity to testify in today's 
hearing on how the STEM workforce shortage is affecting small 
firms.

    My name is Nagappa Ravindra and I am the President of Ravi 
Engineering & Land Surveying. We are a small engineering 
consulting firm based in Rochester, New York. I am here today 
to testify about how H-1B visas are essential to small 
engineering firms that need to hire engineers with specific 
skill sets in order to serve our client's needs. I also want to 
tell you my store, and how my firm would not exist without work 
visas for engineers.

    I am a member of the American Council of Engineering 
Companies (ACEC), the voice of America's engineering industry. 
ACEC members--numbering more than 5,000 firms representing 
hundreds of thousands of engineers and other specialists 
throughout the country--are engaged in a wide range of 
engineering works that propel the nation's economy, and enhance 
and safeguard America's quality of life. Over 70 percent of 
ACEC's members are small firms.

    My firm Ravi Engineering & Land Surveying, P.C. has been in 
business since 1995. I came to this country in 1980 after 
graduating from the Indian Institute of Technology, Madras, 
India, with a Bachelor of Science degree in Civil Engineering. 
I got my Master's degree in structural engineering from 
Syracuse University and started my career as a structural 
engineer in a consulting firm in Syracuse, New York. I was able 
to get a green card within 9 months with the help of my 
employer and became a citizen at a later time. After training 
for 8 years, I moved to Rochester, New York to accept a higher 
position in another consulting firm and worked another five 
years before starting my own business in 1995. I started a 
consulting engineering firm providing structural engineering 
services and went on to add employees and offer other services 
such as bridge design and inspection, land surveying, 
construction inspection, environmental and geotechnical 
engineering. Currently, we average 90 employees and have three 
offices in New York and one in Pittsburgh, Pennsylvania.

    As a member of ACEC, we advocate for a quality based 
selection process and we compete for work based on the 
strengths and talents of our employees. To win projects, we 
need to demonstrate exceptional qualifications and experience. 
So, in order to grow and succeed, we need experienced as well 
as entry level engineers who are exceptional and talented 
individuals. Our growth is limited because of a lack of 
qualified people in our industry. Currently, we have vacant 
positions we cannot fill due to a lack of experienced 
engineers.

    Because there are not enough engineers with the skill sets 
we need, we currently employ one engineer on an H-1B visa, and 
a student on an OPT visa. We had hoped to transfer the student 
to an H-1B visa, but as you know, the current cap of 65,000 was 
met in just five days and our labor certification could not be 
completed in time.

    Engineers and the engineering industry are major economic 
drivers and play an essential role in helping the U.S. compete 
in the global economy. Engineers are in high demand, but the 
output of new engineers from the nation's universities is not 
keeping up with the needs of the industry and the nation.

    Bachelor's degrees in engineering have declined by nearly 
20 percent since 1985. The workforce is also getting older: 
nearly 30 percent of all engineering and science degree holders 
in the labor force are 50 or over and are headed toward 
retirement.

    There is also greater competition for the diminishing pool 
of engineering graduates, particularly from the information 
technology industry seeking the skill sets that engineering 
graduates provide. Only half of engineering degree holders work 
in the engineering field. According to Duke University, between 
30 and 40 percent of graduates from the University's Masters of 
Engineering Management program take jobs outside of the 
engineering profession.

    Moreover, the proportion of foreign students earning 
engineering degrees at American universities is quite high. 
According to the American Association of Engineering Societies, 
for the 2008-2009 academic year, foreign nationals comprised 
43.9 percent of the Master's and 54.6 percent of the Ph.D.s 
awarded in engineering by U.S. universities.

    With so many engineers graduating from American 
universities and working in other fields, it does not make any 
sense to send trained foreign engineers home to work for our 
competitors in the global marketplace. If I had not been given 
the opportunity to stay and work in the United States, 90 
American workers would not have the job opportunities provided 
by my firm. My story is not unique. Speaking from my personal 
experience, nearly half of my graduating class of 220 students 
from Indian Institute of Technology, Madras, India came to the 
United States in 1980 to pursue higher education. Out of that 
pool of 110 engineers who came to this country, today, nearly 
30% have their own businesses employing a large number of 
Americans, about 20% are CEO's, CTO's, General Managers and 
senior officers in Fortune 500 companies, 20% are professors, 
deans and educators in premier institutions and the remaining 
have become venture capitalists and successful investors.

    I strongly believe that the United States needs to invest 
in talented and young engineers similar to investing in our 
roads, bridges and infrastructure as a long term strategy for 
growth and prosperity. I urge Congress to strengthen and expand 
the H-1B visa program so that firms like mine will be able to 
hire the necessary engineering talent to serve our clients' 
needs and continue to grow and thrive. Thank you for the 
opportunity to participate in today's hearing, and I would be 
happy to respond to any questions from committee members.
    4/25/2013

    Mr. Chairman and Members of the Subcommittee:

    My name is Ryan Costella. I serve as the Director of 
Strategic Initiatives at Click Bond, Inc. We are a family owned 
company and just celebrated our 25th anniversary this past 
year. We employ 250 people at our headquarters in Carson City, 
NV, and an additional 60 people at our facility in Watertown, 
CT.

    Thank you for the invitation to testify today at the 
hearing: Help Wanted: The Small Business STEM Workforce 
Shortage and Immigration Reform. I look forward to our 
conversation on the importance of STEM skills and their 
relevance to economic stability and the viability of small 
businesses.

    Click Bond is the global leader in the design and 
manufacture of adhesive-bonded fasteners. Our products have 
revolutionized how the aerospace, marine, and transit vehicle 
sectors build their products around the world. Industries that 
were once dominated by riveted fasteners in their assembly 
solutions have evolved substantially, now embracing the use of 
structural adhesives to create the attachment points, which 
prevents the drilling of holes.

    Our customers realize significant savings on cost of labor 
and materials, increased efficiency and profitability, and 
enhanced health and safety and reduction of risk. They trust 
our record of commitment to quality design, performance, and 
on-time delivery of parts. They know they can depend on our 
unique ability and knowledge of materials not only to innovate 
new solutions for their future challenges but also to provide 
robust customer service and training anytime, anywhere in the 
world.

    We are proud of our presence as a U.S. manufacturer, 
leading our industry in innovation, environmental stewardship, 
and workforce development. We are heavily involved in our 
community and are committed to building partnerships with 
educational, workforce, economic development, and civic leaders 
to create a sustainable talent pipeline that serves the 
workforce needs of the manufacturing industry for decades to 
come.

    Click Bond is a family itself and remains committed to 
fostering a family-friendly culture that provides our employees 
with competitive pay and benefits as well as multiple career 
advancement opportunities through subsidized education and 
training. As a result, we are developing a talented next 
generation workforce that enhances our competitiveness and 
capacity to continue meeting customer needs globally.

    The future is bright, and there is no shortage of 
opportunity for us to continue innovating, growing, and 
expanding our business right here in the United States. To do 
that sustainably, however, we must aggressively confront an 
issue that most businesses are facing, which has now commonly 
become known as the Skills Gap.

    Despite high unemployment levels, businesses are struggling 
today to find skilled employees to fill their jobs. Compounding 
the problem, millions of Baby Boomers are preparing to leave 
the workforce, and we haven't even begun to account for growth.

    Will it be possible to fill this gap? If we are struggling 
to find skilled people today, where will we find them in the 
future, as the problem magnifies? How do we fix this problem?

    While there are no easy answers, I can report that Click 
Bond and other companies like us are taking the problem very 
seriously and finding new ways to tackle the issue head on.

    There is a lot of talk about STEM education these days. 
Many people wonder, ``What the heck is STEM?'' They are then 
told it means, ``Science, Technology, Engineering, and Math.'' 
But that's not really an explanation of what we mean by STEM 
education and skills.

    Let me be more specific from an employer's perspective. 
Frankly, STEM starts with the basics that all people should 
master in a basic education. The ability to read, write, do 
math, and think critically are all key pillars, complimented by 
the ability to show up on time, communicate effectively, and 
work in teams. People with these skills can be developed and 
trained to pursue a menagerie of career pathways in multiple 
sectors of our economy. Without those foundational skills, the 
future is bleak.

    Ideally, these skills are mastered by the time a person 
leave high school. Whether we're talking about an entry level 
accountant or technician on our assembly floor, our top design 
engineer or a quality inspector, the head of our sales team or 
the folks who package and ship our parts out the door, all 
aspects of today's manufacturing workforce require these 
foundational skill sets on a daily basis.

    As you might imagine, these skills aren't unique just to 
manufacturing. Many employers, whether in energy, defense, IT, 
health care, transportation, logistics, hospitality, 
entertainment--the list goes on--require these basic skills.

    Unfortunately today, even with record unemployment numbers, 
we are having a tough time finding people who can demonstrate 
these basic skills.

    Some allege that maybe this gap isn't real at all and 
that's it's just an acute problem. Maybe manufacturers are just 
``too picky.'' Finding people with the basic skills I 
outlined--ability to read, write, do math, problem-solve, show 
up on time, communicate effectively, and work in teams--isn't 
some outrageous litmus test for employment: it's the minimum 
threshold to have a chance at a future on any career path.

    Some say we don't pay enough. That's not true either. In 
2011, the average manufacturing worker in the United States 
earned $77,060 annually, including pay and benefits. The 
average worker in all industries earned $60,168. Even more, for 
every dollar spent in manufacturing, another $1.48 is added to 
the economy, the highest multiplier effect of any economic 
sector. Our greatest asset is our people, and most 
manufacturers fund robust training and education programs in 
partnership with our local high schools, community colleges, 
and universities.

    Some say our operations are too dirty, and the jobs are too 
low-level. None of this is true either. If anything, people are 
constantly surprised with how clean manufacturing operations 
are in the 21st century. We sit at the forefront of 
environmental, safety, and quality standards. We can't compete 
globally if we aren't. To maintain these top notch 
requirements, we depend on highly skilled individuals, even for 
our most entry level jobs. With rapidly evolving technology, we 
need people who have the foundations to think, challenge the 
status quo, and solve new problems that we can't even 
anticipate today.

    In response to these misperceptions and to the larger 
problem of the Skills Gap, many of us historically have pounded 
our fists on the table and pointed fingers, blaming the 
education system and other leaders for the gap we're sending. 
Blaming and finger-pointing don't achieve anything. This 
problem is serious, and we have to work together to find 
solutions.

    I'm happy to say that we've changed our tune in Nevada by 
looking in the mirror. Let me share with you some of the 
success we've seen.

    The manufacturing community has realized that our proactive 
communication is the key to the future. We are engaging with 
students, parents, teachers, and the community to explain that 
our industry isn't dirty smokestacks and low-paying jobs; in 
fact, we're bringing a message that manufacturing jobs ARE that 
well-paying jobs of the future. Along with marketing and 
advertising campaigns like Dream It Do It, commissioned by the 
Manufacturing Institute, we are opening the doors of our 
factories to teachers, students, and parents, and we're making 
substantial progress in showing our community that our 
operations represent the most exciting and sustainable careers 
of the future!

    We are engaging with leaders in higher education--
especially our community colleges--to ensure that their 
investments in training facilities and curriculum are 
worthwhile. We are now scaling a fast-track training program 
that literally takes people from the unemployment lines to full 
time employment with benefits as machine operators (the entry 
level position for a career as a machinist) in just 16 weeks. 
We were proud to hire four graduates from the program, and all 
of them stand out as model employees with bright futures ahead 
of them. Similar programs are in development for welding.

    We partner with leaders in our workforce development system 
to ensure that the formula used in allocating Workforce 
Investment Act and other training dollars is demand-driven. 
Using these funds to train people for the jobs that exist today 
and in the future while simultaneously providing them with 
nationally portable, industry driven credentials as proof of 
their skill set is a win-win equation for everyone, employee 
and employer!

    We partner with economic development officials by 
highlighting the success stories and illustrating the number of 
national credentials granted as proof of a skilled workforce to 
attract more employers to our state to take advantage of the 
talent we are cultivating here.

    We are making these investments because it's critical for 
our survival. We are making these investments because 
manufacturing is a tremendously exciting career path. Our 
quality-critical products enhance the performance and longevity 
of military aircraft and the efficiency and competitiveness of 
airliners/commercial aircraft. Others are developing technology 
and products that are causing breakthroughs in medicine, 
renewable energy, IT, transportation, logistics, and so much 
more. The reality is: manufacturing makes America strong. And 
we want to keep it that way.

    Our efforts to develop and train people alone, however, 
aren't enough.

    As the Baby Boomers leave our workforce, we will need to 
find new engineers, quality control experts, machinists, 
accountants, marketing and communications professionals, and so 
many more in order to grow and compete in the 21st century and 
beyond.

    It will be critical that we have a pool of talent from 
which to recruit this dynamic manufacturing workforce.

    We are strong believers that competition breeds excellence, 
so if people from other parts of the world are eager to come 
here legally to pursue their passion or a great idea or to be 
part of existing ideas that are flourishing, we want to welcome 
them. That's what America is all about, and it's what makes us 
different!

    As the CEO of the National Association of Manufacturers 
recently stated, ``Talent and skill have no 
borders...Manufacturers need to be able to hire the right 
person with the right skill at the right time.''

    Our company wants access to the world's best and brightest, 
period. Thousands of small and medium sized businesses are in 
the same boat. If existing regulations can be adjusted to make 
it easier for hard-working and talented people to come here 
legally to stay and build lives and families, pay taxes, and 
help make our businesses even more dynamic and viable--not to 
mention make our economy stronger and our future more secure--
then we stand in support of those ideas. Rather than education 
the world's best in our universities and then send them home to 
eventually sit across from us at the negotiating table, let's 
make it easier for them to stay here in our great country and 
sit on our side of the table.

    Thank you, and I look forward to your questions.
    Testimony

    of

    Morgan Reed

    Executive Director

    The Association for Competitive Technology

    before the

    Committee on Small Business

    The Subcommittee on Contracting and Workforce

    on

    Help Wanted: The Small Business STEM Workforce Shortage

    and Immigration Reform

    April 25, 2013
    Chairman Hanna, Ranking Member Meng, and distinguished 
members of the Committee: My name is Morgan Reed and I thank 
you for holding this important hearing on small business 
science, technology, engineering, and math (STEM) workforce 
shortage and immigration reform.

    I am the executive director of the Association for 
Competitive Technology (ACT). ACT is an advocacy and education 
organization for people who write software programs--referred 
to as application developers. We represent over 5,000 small and 
mid-size IT firms and advocate for public policies that help 
our members leverage their intellectual assets to raise 
capital, create jobs, and innovate.

    Our organization was founded in 1998 with the commitment to 
foster an environment allowing small technology companies to 
flourish. Our founders believed that the greatest innovation 
occurs in nimble companies like these and our board of 
directors has always been exclusively comprised of small 
business owners. The emergence of the mobile economy over the 
last five years has provided tremendous opportunity for our 
members to market software directly to consumers as apps.

    While this new marketplace has thrived, we are now faced 
with a serious challenge--our country is not producing enough 
software developers to allow companies to grow. America's 
schools no longer provide the math and computer science skills 
to fuel the innovation that has long driven economic growth in 
this country.

    This concern has become so grave that many companies are 
willing to pay double the current fees for additional visas and 
green cards so long as the added funds are designated 
exclusively for science, technology, engineering, and math 
education. The industry is willing to incur these extra costs--
up to $5 billion--believing that schoolchildren educated in 
STEM subjects are more likely to pursue careers in technology.

    The simple fact that companies are willing to pay double 
the existing fees should speak volumes--when's the last time 
anyone has uttered the words ``charge me more, please''?

    The small businesses that are tomorrow's leading technology 
companies know that finding the right employee today through an 
H-1B, and tomorrow through better STEM education, is critical 
to their ability to reach their full economic potential.

    The Tech Ecosystem and Job Creation

    I spend a significant portion of my time speaking to non-
developer audiences who want to know about the state of the 
mobile apps economy. Unlike other industries, I find that I 
have to update my numbers for every speech, not just once or 
twice a year. Just two years ago, total industry revenues were 
$3.8 billion and expected to rise to $8.3 billion. However, by 
the end of last we already reached $20 billion and are now 
projected to reach $100 billion by 2015.\1\ This is a meteoric 
rise for an app economy that didn't even exist five years ago.
---------------------------------------------------------------------------
    \1\ Egle Mikalajunaite, ``The Application Development Market Will 
Grow to $US100bn in 2015,'' research2guidance (July 6, 2011) available 
at http://www.research2guidance.com/the-application-development-market-
will-grow-to-us100bn-in-2015/.

    Smartphones derive considerable value from the apps that 
run on them. Consumers are attracted to phones based on the 
functionality these program provide. Telephone companies and 
handset makers have devised entire ad campaigns highlighting 
the apps that run on their platforms. ``There's an app for 
that'' is probably one of the most recognizable ads in the 
---------------------------------------------------------------------------
technology space.

    This success has had a dramatic impact on job creation. 
ACT's study in 2011 estimated that the current mobile apps 
economy has created, saved, or supplemented more than 600,000 
jobs nationwide across iOS, Android, Windows Phone 7, and 
Blackberry platforms.\2\ Another study by TechNet showed nearly 
500,000 jobs created by the app economy on the major platforms 
alone.\3\ We are sure that those numbers have grown by 20 
percent or more through 2013, compared to an overall job growth 
rate more in the 7-10 percent range.
---------------------------------------------------------------------------
    \2\ ``Testimony of Morgan Reed before the House Committee on Energy 
and Commerce Subcommittee on Commerce, Manufacturing and Trade.'' (Oct. 
5, 2011) available at http://democrats.energycommerce.house.gov/sites/
default/files/image--uploads/
Testimony--10.05.11--CMT--Reed.pdf
    \3\ ``New TechNet Sponsored Study: Nearly 500,000 `App Economy' 
Jobs in the United States,'' TechNet (Feb. 7, 2012) available at http:/
/www.technet.org/new-technet-sponsored-study-nearly-500000-app-economy-
jobs-in-united-states-february-7-2012/

---------------------------------------------------------------------------
    ACT July 2012 Study of Top 800 Apps: Findings and Analysis

    In 2012, ACT looked at of the current mobile app ecosystem, 
this time examining apps not only by revenue, but also by type 
and by geographic location.\4\
---------------------------------------------------------------------------
    \4\ ``Apps Across America: The Economics and Ecosystem of the 
Mobile App Market,'' ACT (July 18, 2012), available at http://
actonline.org/files/Apps-Across-America.pdf.

    The results of our research showed two key results relevant 
---------------------------------------------------------------------------
to this committee:

          1. Seventy eight percent of the top app developers 
        are small businesses, with U.S. based companies 
        heaviest in California, but significant regional 
        diversity, especially in Business and Education 
        applications

          2. U.S. developers make a majority of apps, but 
        international developers make up a growing portion of 
        the market.
        [GRAPHIC] [TIFF OMITTED] 
        

    ACT research continues to find that the majority of the 
top-selling mobile app developers (78%) are small businesses. 
Nowhere is the dominance of small business seen more than in 
education apps, where over 70% of the app developers surveyed 
were small businesses. Of those small businesses, 87% have 50 
or fewer employees.

    Without question, the new, increasingly mobile consumer is 
creating opportunities at every level and in every location of 
this country.

    The Bad News

    America's dominance in this fast growth market is held 
together by our ability to find new employees who can provide 
and support innovative new solutions. According to the U.S. 
Bureau of Labor Statistics, America is expected to create 
120,000 new jobs in computer science annually throughout the 
decade, but our universities only produce 40,000 graduates a 
year qualified for these positions.\5\ Self-taught individuals 
will help to fill that gap but at the end of the day, even the 
self-taught require an understanding of the kind of complex 
mathematics that drive today's data-crunching algorithms.
---------------------------------------------------------------------------
    \5\ This estimate is based on the U.S. Bureau of Labor Statistics' 
occupational employment and job openings data, projected for 2010-2020, 
available at http://www.bls.gov/emp/.; Integrated Postsecondary 
Education Data System from the U.S. Department of Education's National 
Center for Education Statistics (NCES) available at https://
webcaspar.nsf.gov.

    Moreover, the jobs we are sending overseas by failing to 
educate at home aren't bad ones. Software developers command 
significantly higher wages--$93,280 at the median according to 
the Bureau of Labor Statistics;\6\ all with an unemployment 
rate among computer-related occupations of only 3.2 percent.\7\
---------------------------------------------------------------------------
    \6\ ``Occupational Employment and Wages, 15-1132 Software 
Developers, Applications'' Bureau of Labor and Statistics (May, 2012) 
available at http://www.bls.gov/oes/current/oes151132.htm.
    \7\ ``Unemployed Persons By Occupation And Sex'' Bureau of Labor 
and Statistics (March 2013) available at http://www.bls.gov/web/empsit/
cpseea30.pdf.

    For ACT's members, this job shortage creates an ideas 
problem. Prospective employees may choose to work at a larger 
corporation because of the job security that risky new ventures 
simply cannot match. And while you may think that's good for 
the employee, it could be bad for our innovation economy. 
According to an analysis of patents by the US Patent and 
Trademark Office, small businesses account for 51 percent of 
---------------------------------------------------------------------------
the most innovative (and most often cited) patents.

    The primary reason is the steep decline in schools teaching 
computer science. Only 1 in 10 high schools offer the class, 
and computer science accounts for just 0.6 percent of all 
Advanced Placement tests taken--a 60 percent drop since 
2000.\8\ University students are less likely to major in a 
technical subject if they have not studied it in high school. 
To fill classrooms, computer science departments admit foreign 
students who are then ineligible to work in the U.S. upon 
graduation.
---------------------------------------------------------------------------
    \8\ The College Board's Database of AP Course Audits, available at 
https://apcourseaudit.epiconline.org/ledger/search.php.

    When the Association for Competitive Technology's small-
business members visit their representatives in Washington, 
they identify this broken pipeline of STEM education as the 
root cause of the high-tech worker shortage. Unable to find 
qualified computer science graduates, one California member 
company has 40 unfilled positions currently and some positions 
have been open for more than two years. At a hearing last year, 
Flurry, the fastest growing mobile analytics company, testified 
that it had more than 80 openings, many requiring the kinds of 
math and science that can't simply be learned over a weekend. 
Earlier this week, Microsoft testified that they had 6,300 open 
positions. Imagine what it's like for a small company to 
convince a great candidate that they should turn down the offer 
---------------------------------------------------------------------------
from Microsoft, or any other major technology company.

    Finally, the Economist reports that for every job created 
in the high tech sector, 4.3 additional positions are created 
in the local economy.\9\ Therefore the jobs we see unfilled 
today will lead to hundreds of thousands of lost local 
employment in a wide variety of other fields.
---------------------------------------------------------------------------
    \9\ ``The Jobs Machine: Start-ups founded by immigrants are 
creating jobs all over America'' The Economist (Apr. 13, 2013).

    If we lose those jobs, where do they go? The beauty of the 
internet is its global, always-on nature. But this very global 
nature is why our failure to deal with the STEM problem could 
be catastrophic. Unlike other businesses, these high paying 
tech jobs can simply move elsewhere. Small companies that 
previously would never have considered overseas hiring now look 
to Israel for high skilled math workers, or Norway for User 
---------------------------------------------------------------------------
Interface expertise.

    Fixing The Problem

    Step One: the H-1B Band-Aid

    There is no way to fix that skills gap overnight; it will 
take eight to ten years to see any STEM program produce the 
kind of impact we know is needed. So where does the needed math 
and science talent lay today? Right here in America's colleges 
and universities.

    It is estimated that in colleges and universities, foreign-
born doctorate degree holders account for approximately 33% of 
the full-time faculty in computer sciences, 26% in engineering, 
33% in mathematics, and 22% in the physical sciences. At the 
postdoctoral level, the participation of foreign doctorate 
holders is 56% in engineering, 50% in mathematics, and 42% in 
physical sciences. Data show that since 1990, approximately 50% 
of the U.S. Nobel laureates in the scientific and technical 
disciplines were foreign-born.\10\
---------------------------------------------------------------------------
    \10\ CRS Report Foreign Science and Engineering Presence in U.S. 
Institutions and the Labor Force Christine M. Matthews, Oct. 28, 2010.

    With that kind of talent pool here on our shores, finding a 
way to keep them becomes critical. But H-1Bs are very limited, 
and often go to large, deep-pocketed firms that can afford to 
wait months to find out if a visa has been awarded. According 
to a 2011 GAO study, in years where the H-1B cap was met 
quickly and applicants denied, small businesses were the big 
losers, facing economic loss and product delays.\11\ To avoid 
this negative impact on small business, a higher, more rational 
cap to H-1Bs must be in place.
---------------------------------------------------------------------------
    \11\ ``For example, in years when visas were denied by the cap, 
most large firms reported finding other (sometimes more costly) ways to 
hire their preferred job candidates. On the other hand, small firms 
were more likely to fill their positions with different candidates, 
which they said resulted in delays and sometimes economic losses, 
particularly for firms in rapidly changing technology fields.'' U.S. 
Government Accountability Office, ``H-1B VISA PROGRAM: Reforms Are 
Needed To Minimize The Risks And Costs Of Current Program,'' 
www.gao.gov, January 2011

    However simply increasing the cap will not be enough. We 
need the right employee to make it to our small business 
doorstep because we can't just pick anyone to fill the slot. 
Today's technology companies have found that the right team can 
be more valuable than just the right skill. According to a 
---------------------------------------------------------------------------
recent Reuters article, the right fit is everything:

          ``Especially in a small start-up, they say, more than 
        expertise is required: The right fit is critical. `When 
        you're creating something from scratch you need 
        somebody outstanding,' said Nathan Blecharczyk, co-
        founder of the red-hot short-term rental company 
        Airbnb. The firm currently has only two engineers 
        working on its search capability, he explained--a 
        critical function that could be improved if he could 
        find just the right caliber of engineer. `There isn't 
        enough of the talent that we need to basically create 
        this business in the U.S.,' he said. `We do need to 
        look globally for that talent.''' \12\
---------------------------------------------------------------------------
    \12\ ``VCs and Startups Call for More H-1B Visas, But Some Say 
Talent Shortage is Exaggerated,'' Reuters, (April 10, 2013). 4/10/13

    To help small businesses, we support efforts to recapture 
unused employment-based green cards. We also support an 
exemption from the annual limits for U.S. advanced STEM degree 
holders. This should reduce the backlog, helping a small 
business make a realistic offer that results in a key team 
---------------------------------------------------------------------------
member moving from ``visitor'' to ``resident.''

    Clearly small businesses need more H-1B visas in the 
pipeline. Unfortunately, some recent efforts to increase the 
number of H-1B visas come with far too many strings attached. 
The most recent version of the ``Gang of Eight'' bill in the 
Senate includes language that could create incredible 
regulatory hurdles.

    We understand the desire of those in the Senate to ensure 
the correct use of H-1B, but if the level of bureaucracy 
functionally bars small businesses from using H-1B visas, we 
will harm the very innovators we need to support.

    Specifically, the bill includes a recruitment requirements 
for non-dependent employers who are only modest users of the H-
1B program. This recruitment language will require companies to 
maintain extensive records of individualized hiring decisions 
and subject employers to extensive scrutiny and second-guessing 
by the Department of Labor (DOL), years after the hiring 
decision, over case-by-case hiring outcomes.

    And while the H-1B program should not be used to displace 
U.S. workers, the language mixes displacement and layoffs. 
Companies, especially small ones, often need to pivot to meet 
new strategic challenges. Their design or plan may not be 
workable against a competitor, or the platforms they depend on 
may change. These regular business requirements do not rise to 
the level of ``for cause'' terminations, and therefore create 
incredible burdens on small businesses who must be nimble to 
survive.

    Instead, we believe legislation could help to protect 
workers better by other means. For example, legislation could 
restrict these provisions to employers whose net hiring of U.S. 
workers for the year is lower than layoffs within the same 
occupation.

    Step Two: The STEM Investment

    Scott Stanfield, an ACT member and president of Vertigo 
Software, Inc., addressed the STEM question with the best 
possible answer I have ever heard. When asked about why he 
supported using H-1B money for STEM, Mr. Stanfield answered:

          I have been in business for a bit more than 15 years, 
        and I plan to be in business 15 years from now. I know 
        I will need talented, well-educated programmers in the 
        future. I want that child who is just now entering 
        grade school to have the training needed so that I can 
        hire them as soon as they are ready

    Mr. Stanfield's long-term perspective is not uncommon for 
our small business members. They all plan to be in business, 
the technology business, for the foreseeable future. And they 
know that will take serious investment.

    Technology businesses both large and small see value in 
funding STEM education through additional fees on H-1B visas 
and green cards. The I-Squared Act proposes to raise $500 
million annually over ten years to be allocated for teacher 
training, post-secondary STEM programs, and computer science 
community college training. This funding represents a fraction 
of the positive economic impact for future generations who can 
fill these jobs currently going overseas, or simply remaining 
unfilled.

    Looking beyond a Band-Aid fix, however, requires us to 
focus our efforts on primary and secondary education. If we 
hope to produce enough graduates capable of qualifying for 
these high wage tech jobs, then students must be exposed to 
computer science education at an early age. This will require a 
renewed commitment to the subject in school districts across 
the country. Currently, only ten percent of high schools offer 
computer science courses. If students have never taken a 
technical subject before college, they are unlikely to pursue 
it as a major.

    In the Senate I-Squared legislation, tech companies have 
expressed a willingness to pay double the current fees for 
additional tech visas and green cards if the extra funds are 
dedicated to STEM education in U.S. schools. Generating as much 
as $5 billion to expand education in these subjects, the tech 
industry hopes that more schoolchildren exposed to computer 
science will choose careers in the tech field.

    The current draft of the Senate's ``Gang of Eight'' 
immigration bill allocates money for STEM education funded by 
H-1B visa fees, but most of it is directed to post-secondary 
education. A far larger percentage must be dedicated to educate 
schoolchildren in primary and secondary schools if they are to 
develop an interest in computer science and acquire the skills 
necessary to pursue it as a major in college.

    The work of a few nonprofits reveals this approach yields 
success. One example comes from a group called CodeNow that 
conducted afterschool computer science training for students in 
Washington, DC. The organization targeted children in 
underserved communities whose schools didn't offer the subject. 
After teaching the students how to write software, one of the 
participants won a national STEM video game challenge only a 
year later. More importantly, these high school age children 
are sticking with it. Today, 30 percent of the program 
graduates have gone on to major in computer science at 
university.

    Another program called the Young People's Project teaches 
school children math and other STEM skills. It is a math 
literacy outreach and mentoring program, utilizing high school 
and college students as ``math literacy workers'' that focus on 
innovative teaching techniques to make the subject more 
accessible through hands-on activities and workshops. The 
organization believes that kids who master math (and other STEM 
skills) develop greater academic self-esteem, and are more 
likely to succeed in school and become leaders in their 
community. They have programs in Boston; New York City; 
Jackson, MS; Ann Arb or, MI; Eldorado, IL; and Mansfield, Ohio.

    These non-profit organizations have provided valuable 
insight for the government into how to design effective STEM 
programs and the incredible results that could be achieved with 
the kind of real, long-term investment that the I-Squared Act 
provides.

    Conclusion

    Mobile app makers and small tech companies are at the 
leading edge of innovation and job creation, but their 
inability to hire more workers is limiting their growth. Recent 
immigration legislation offers relief in the form of expanded 
H-1B visa and green card access.

    This meets immediate staffing needs, but doesn't provide 
the solution to America's chronic shortage of software 
developers and engineers. Our nation cannot maintain its global 
technology leadership with a foreign labor dependency. We must 
foster the growth of an American software developer workforce 
to ensure our industry's long-term stability and 
competitiveness.

    Lucrative careers in the thriving tech industry should be 
more accessible to American students. If we are willing to 
invest in STEM education, particularly at the secondary level, 
we can get this done. The tech industry is willing to do its 
part to help fund these measures through increased fees for 
high skilled visas. The Senate I-Squared Act provides that 
opportunity. We hope Congress agrees with this approach and 
allows us to help.

                                 
