Auto Industry to Suffer Without Skilled Immigrants

Scott Cooper

Imagine a communist country making significant progress toward building more diverse technology-based industries than the United States, and becoming more attractive to highly skilled workers from around the world.

It’s a reality today, and it’s China.

Automotive manufacturing is a key area of focus for China, a nascent industry player testing its mettle. That could spell disaster for the American auto sector, especially suppliers.

China, now the world’s largest car market, is attempting to lure home its citizens living abroad, along with highly skilled immigrants to solidify and protect its growing position as a sophisticated global technology center. And its immigration policies support this goal.

The appeal of cheap labor in China and India diminishes as wages skyrocket, along with other costs related to patent and copyright protections, product quality requirements, shipping and commercial legal systems that tend to favor native companies. But if U.S.-based firms cannot recruit and retain skilled labor, innovations and jobs in the auto industry will leave America’s shores and go to immigrant-friendly countries.

If Congress fails to provide visas for more skilled immigrant workers, manufacturers will continue to move research and development to offshore centers, designed to meet the production needs of local markets but prepared to export to this country. Production jobs would be adversely affected, since an increasing number of manufacturing positions call for specific skill sets that the U.S. is currently ill equipped to fill.

The real risk is that the nexus of innovation will move overseas where the best workers will be trained.

Consider the growth trajectory of robotics. Business is booming at The ABB Group, a Swedish-owned automation technology provider in Auburn Hills, MI. The company is shipping its products across the U.S. and the world. And the main driver is the use of robotics to reduce labor costs and increase output quality for repetitive and exacting tasks.

Robotics eliminates jobs at one level, but creates a need for skilled engineers, systems analysts, programmers and other trained positions at a higher level. A senior ABB official recently noted that the company has about 50 unfilled engineering positions and expects this problem to persist.

Opponents of immigration reform argue that temporary visa holders steal jobs from U.S. workers. But that’s a myth.

A study published by the National Foundation for American Policy found that for every H-1B visa worker hired by U.S. employers, about four to eight jobs are created for U.S. workers, because new products developed by high-skill immigrants need to be manufactured, managed and marketed, causing a ripple effect of job growth.

Failure by Congress in 1994 to continue funding the $12 billion superconducting super collider in Texas led to the recent discovery of the sought-after Higgs boson-like nuclear particle at CERN in Europe, not in the U.S.

Perhaps the tremendous cost of the Texas project was a real concern for Congress, but the allocation of more visas costs individual taxpayers nothing, since employers pay for them. U.S. employers also pay billions of dollars into a fund to provide training and education for U.S. workers as a condition of obtaining these visas.

Nuclear physics research facilities in the U.S. such as Fermi National Laboratory are losing scientists to CERN – where the action is – and new projects and future discoveries are more likely to originate there, not here.

American companies relying on new technologies and American citizens will bear the cost of our government’s inability to fix the skilled worker visa problem, because innovation and jobs will move away.

Scott F. Cooperis a partner and managing attorney in the Troy, MI, office of pre-eminent immigration global law firm Fragomen, Del Rey, Bernsen & Loewy. He advises major universities, research institutions and Fortune 100 companies on business-related immigration matters, including policy and compliance. He is admitted to the Michigan, Illinois and New York bars, along with the U.S. District Court and U.S. Supreme Court.