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June 3, 2013

H-1B visa expansion likely a boon for CT Inc.

Contributed Photo The U.S. Senate, pictured above, is debating a comprehensive immigration reform bill that would potentially more than double the number of high-skilled foreign nationals allowed to work in the U.S. The change could have a major impact on Connecticut as the state attempts to grow its high-tech job sector.
Amy Haberman, partner, McCarter & English

New federal legislation that would potentially more than double the number of high-skilled foreign nationals allowed to work in the U.S. could have major ramifications for Connecticut, as the state attempts to significantly ramp-up job growth in science, technology, engineering and math related fields.

The proposal is part of the sweeping immigration reform law being discussed in the U.S. Senate that would boost the number of H-1B visas that can be granted annually from 65,000 to as many as 180,000.

H-1B visas allow employers to temporarily hire foreign, high-skilled workers in the U.S. in occupations largely related to science, technology, engineering, and math, or so-called STEM fields.

Some of Connecticut’s blue chip companies have aggressively pursued visas in recent years and could benefit the most from the change. They include UBS, Cigna, Aetna, Travelers, Boehringer Ingelheim, Stanley Black & Decker, and United Technologies. A large number of small-to-midsize Connecticut tech companies are competing for the visas as well.

The proposal comes as demand for H-1Bs has soared in recent years and when Connecticut is investing hundreds of millions of dollars in STEM-related initiatives to boost the state’s competiveness in attracting high-tech jobs.

But some of those investments may not pay off, some experts say, unless the state can attract or develop highly skilled talent.

An expanded H-1B visa program could jumpstart growth, experts say.

“I think the state will have difficulty achieving the sort of growth they envision without the increased use of H-1B and a decent immigration reform bill,” said Peter Gioia, an economist with the Connecticut Business & Industry Association. “I think the visas are a big deal.”

Gioia said expanding the visa cap would be a major potential boost to Connecticut’s economy with its concentration of high-tech manufacturing, bioscience and pharmaceutical companies.

To grow those industries, Gioia said, the state needs to attract foreign skilled workers, partly because they are well-educated, but also because the U.S. has been slow to develop its own STEM talent pool.

Gioia said he hopes the immigration law will also make it easier for visa recipients to stay in the U.S. permanently because that could bring long-term economic benefits.

“Quality immigration leads to a net increase in native born employment,” Gioia said. “Having those skilled people will help the economy expand.”

Demand for H-1B visas has taken off in recent years after activity slowed following the 2008 financial crisis.

In fact, U.S. Citizenship and Immigration Services (USCIS) received so many applications during the first week of the April open enrollment period this year that the agency had to resort to a lottery to issue visas.

“There is clear evidence that Connecticut companies are getting frozen out this year,” said Adam Mocciolo, a lawyer with Pullman & Comley in Bridgeport. “If they were to raise the quota by 30,000 to 40,000, it would make a big difference for our clients.”

Amy Haberman, a partner at law firm McCarter & English in Stamford, said she has seen firsthand an increase in H-1B visa interest from companies in Connecticut and across the country. Employers use immigration attorneys to help shepherd them through the visa process, which costs several thousand dollars per application.

Federal law caps the number of H-1B visas issued in a year at 65,000, although certain exemptions can raise that number to as high as 85,000. Federal lawmakers are considering raising the cap to as high as 180,000.

The visas must go to foreign workers with at least a bachelor’s degree, or equivalent education experience, in a specialized field. High-tech or STEM-related companies are often the most aggressive in pursuing H-1Bs, but other professions like fashion design operations also use the visas.

Once a visa is granted, it’s good for three years but can be extended up to six years, Haberman said.

In fiscal 2011, Connecticut companies submitted to the U.S. Department of Labor, 5,802 labor certification applications for as many as 16,856 temporary H-1B worker positions. That was a 6 percent increase in activity from a year earlier.

The labor certification application is the first step in the H-1B approval process that requires employers to disclose the position, salary, prevailing wage, and location of the temporary worker they want to sponsor.

Once the labor department gives its approval, firms must file an official H-1B petition with USCIS.

Many high-tech areas around the country — including California, New York and Texas — are often the biggest visa users. But many Connecticut companies are also major players.

According to a Hartford Business Journal computer analysis of U.S. Department of Labor data, the top private Connecticut companies with certified H-1B applications in 2012 included: East Hartford’s Infotech Enterprises (197); CYMA Systems of Manchester (191); Glastonbury’s Sagarsoft Inc. (164); UBS Securities in Stamford (99); and Danbury’s Genpact LLC (85).

Universities and hospitals including Yale, UConn, and Hartford and St. Francis hospitals are also H-1B users, but their visa totals are exempt from the cap.

Yale University had 269 visa applications certified by the Department of Labor in fiscal 2012, while UConn had 69 certified applications.

It’s not clear, however, how many H-1B visas those Connecticut universities or companies were actually granted in fiscal 2012.

Besides benefiting existing employers in the state, an expansion of H-1B visas could help spur Connecticut’s developing industries, experts said.

Gov. Dannel P. Malloy has been aggressive in trying to bolster STEM-related activities in Connecticut through hundreds of millions of dollars in investment. That includes his $864 million Bioscience Connecticut plan to renovate John Dempsey Hospital and expand bioscience research and training facilities in Farmington.

In January, Malloy pitched a $1.5 billion investment in STEM-related facilities, faculty, programs and students at UConn in Storrs.

Meanwhile, The Jackson Laboratory, which is building an 189,000-square-foot genomic research facility in Farmington, already has 11 H-1B employees in Connecticut and is awaiting approval for another 11 H-1B positions.

“We recruit from a worldwide talent pool,” said Jackson Laboratory spokeswoman Joyce Peterson. “The ability to find new faculty and people to work in our labs from all over the world is very important to us.”

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