Commentary: U.S. Biotechnology Companies, foreign nationals, and U.S. graduate schools: The changing dynamics of accessibility to H‐1B visa holders and possible impacts on graduate schools in the molecular life sciences and cognate disciplines

This commentary is the 18th in a series of articles on the nature of biotechnology and its related industries.1 The series is designed to both facilitate the understanding of the industry by the academic educational and research training sector, as well as to better define the consequent educational, discovery and applied research, and developmental research-training needs of future employees. This article addresses the role of foreign nationals in the biotechnology industry and recent congressional legislation that may impact U.S. graduate schools. Regional biotechnology industry clusters [1–3] in the United States, Canada, and the European Union cite access to a skilled labor pool as one of the top two or three most significant hurdles to commercialization. The major U.S. biotechnology clusters continue to report a shortfall in the U.S. labor pool for individuals possessing a number of critical skill sets involved in translational and applied research and development. This has required access of biotechnology companies to foreign nationals with expertise in a variety of disciplines and technologies. The Council of Biotechnology Centers/BIO (CBC/BIO, www.bio.org/aboutbio/committees/; organized under the Biotechnology Industry Organization [BIO], www.bio.org) and the Workforce Committee under BIO conducted the first analysis of any dependence of U.S. biocommerce on foreign nationals. Members of the 1,150-company organization were surveyed between 1998 and 2001 [4], and the results indicated that, depending upon the region of the United States, between 6 and 10% of the U.S. biotechnology workforce possessed a type of U.S. visa (H-1B) designated for temporary allocation to skilled foreign nationals with skill sets not available in the U.S. labor pool (these visas are renewable for up to 6 years and, notably, over 1.3 million H-1B visa applications have been approved since 1997, in all areas of the U.S. workforce). The survey data also pointed to total population of 18,000 H-1Bs in the biotechnology industry nationally, with projected 25% annual increases needed in some of the clusters for additional H-1B visa holders. Relatedly, the U.S. Department of Commerce reported in 2003 that the biotechnology industry workforce grew annually in the period 1997–2003 by an average rate of 12% [5]. Significantly, the extent of dependence of the bioscience industry upon H-1B visa holders and other foreign nationals was not previously known. Up until that time, the U.S. biotechnology clusters had in good faith and fraternity supported the needs of the high-tech industry organization (i.e. information technology (IT),2 computer science, computer engineering, semiconductor, and related industries) in their requests to Congress to amplify the number of H-1B visa holders, but without understanding that, in fact, percentage-wise, the biotechnology industry population of H-1Bs was higher than in several prominent, large high-tech companies surveyed for comparative benchmarking purposes. Notably, it is many times helpful to use the term bioscience industry, which includes the biotechnology, pharmaceutical, and medical device industries. The dependence of the latter two components of the bioscience industry upon foreign nationals has not been assessed, but may be shortly. Currently, the bioscience industry has 880,000 employees versus 2.1 million for the high-tech IT industry, with an additional 2.2 million “indirect” employees (3). Thus, for comparative purposes, the direct workforce of the U.S. bioscience industry is about 40% of the size of the high-tech IT industry. The BIO surveys also found that most biotechnology industry H-1Bs were mainly products of U.S. colleges and universities, not the products of foreign “visa-mills” in Third World countries. In fact, 80% of biotechnology H-1Bs were from U.S. senior higher education (75% graduate-degreed [40% are at the Ph.D. level, 35% M.S., 20% B.S., and 5% M.D.]), and 85% of those eventually acquired permanent residency in the United States (notably, in some high-tech IT companies on the West Coast almost 100% of their H-1Bs eventually attain green card status). Relatedly, the U.S. biotechnology workforce is estimated to be 19% Ph.D., 17% M.S., 50% B.S., and 14% combined vocational educational and community college trained. Biotechnology companies were found to be spending an average of $10,200 on each H-1B holder for processing fees and legal expenses through to a green card, leading to the conclusion that U.S. companies had spent in excess of $150 million over the 5 years previous to 2001 to acquire and keep their H-1B workers. These and other survey data also clearly showed that the H-1B worker skill sets sought by biotechnology companies identically match the most pressing employment needs of the biotechnology industry and that the compensation of these H-1Bs was equal to or, in most cases, higher than U.S. nationals. Due to pressure exerted by the high-tech IT industry, BIO, and other industrial organizations, the national annual H-1B visa cap was raised from 65,000 in the mid 1990s to 115,000 and then again to 195,000 in the 105th Congress via the Hatch Senate Bill 2045, which contained the provision that the cap would revert to 65,000 on October 1, 2004, an event that from the viewpoint of early 2000 was far away and correctable by further legislative intervention. The bill also contained an interesting provision that would have removed from the cap anyone with a graduate degree from a U.S. institution, but this interesting feature was stripped out by Senator Edward Kennedy. Starting in mid-2001, the CBC/BIO initiated discussions with the BIO staff and members of Congress that emphasized the need to begin to consider future legislative strategies that would raise the cap from the future projected 65,000 back to a level that would assure access to these talented foreign nationals. This initiative was fully derailed by 9/11, after which any discussion on amplifying ingress of foreign nationals was fully counter to public and congressional opinion. Starting in late 2002, an undercurrent of quiet but deep-set discussions have been held among H-1B visa-dependent industries as to the timing and extent of any remedies to meeting workforce demands for individuals not present in the general U.S. labor pool, but this did not result in any congressional action. In 2002–03, the concerns were communicated by regional biotechnology clusters to their congressional delegations, but understandably there was no concrete action, either taken or perhaps even politically possible. Although there has not been a CBC/BIO and Workforce Committee biotechnology industry H-1B needs survey since early 2001, it is thought that the demands are in the range of 3,500–5,000 per year. Fortunately, the Hatch S.B. 2045 contained a provision that removed from the cap the 10,000 H-1Bs, specifically people who are employed at an institution of higher education or a related or affiliated nonprofit entity, or at a nonprofit research organization or a governmental research organization, thus relieving a fraction of the pressure on accessing H-1B visa approvals. Representative of the pent-up demand for H-1B visas and anticipated only by the cognoscenti and workforce statistics mavens, and then only partially, the U.S. Citizenship and Immigration Services (USCIS) announced on October 1, 2004, the first day of the new federal fiscal year, that it had received enough H-1B petitions from U.S. companies to use up the entire supply for the next 12 months. The USCIS indicated that it would continue to process cases that it received before October 1, but it will not accept any new H-1B petitions that are subject to the cap for fiscal year 2005. With pressure being applied primarily by the IT, semiconductor, and engineering industrial sectors, especially the National Association of Manufacturers (that BIO has partnered with on the H-1B issue since the mid-1990s), legislation was introduced into the FY 2005 Omnibus Appropriations Bill that made important changes to the H-1B and L-1 visa categories, a bill that President Bush has signed. Notably, new additional H-1B visas have now been made available … with up to 20,000 foreign nationals who have earned a master's degree or higher from a U.S. university being exempt from the H-1B visa cap each year. This exemption is vitally important for foreign nationals who graduated from U.S. universities during 2004 and are now working in F-1 or J-1 visa status with practical training authorization. As you might expect from the above figures, and the primary sources of biotechnology industry H-1B visa holders being U.S. universities, the elimination of 20,000 visa applicants from the cap solves much of the biotechnology industry's (and by extrapolation the pharmaceutical and medical device industries') problems in accessing needed foreign talent. But there are possible consequences for U.S. graduate schools, because the student visa route to H-1B visa route to green card is now quite obvious. Might we expect a greater influx of foreign graduate school applicants in the next few years to take advantage of this conduit to careers in the bioscience industry? Will this opportunity work to counter the recent observations concerning the reductions of foreign students seeking admission to graduate schools, a phenomenon accelerated by 9/11 and one that is of great concern to the National Academy of Sciences and Engineering, the White House Office of Science and Technology Policy, and other vested parties concerned with the U.S. science and engineering workforce? Is the conduit to companies and permanent status that has been opened due to the 20,000 elimination from the cap a device for departments to attract more and better graduate students? Will we see ads “Want Work in the Biotechnology Industry and Get Permanent Status?…. Apply to Graduate School Here!!”? The reliance upon foreign workers does make Congress, states, and regional economic development groups uneasy, and there is a constant pressure to reduce this dependence “ … in favor of home-grown talent.” U.S. institutions, especially universities, are being encouraged to create specialized programs to relieve the U.S. dependence on foreign workers. Clearly, the H-1B route provides a temporary solution to shortages in the national and domestic biotechnology labor pools, shortages that mirror the inadequate production of appropriately trained U.S. nationals by U.S. institutions of higher learning. The reality is that universities have inadequate resources for expanding their training pipelines, especially in specialized areas that follow the basic-research phase of company product development. Efforts should be directed toward influencing greater congressional and federal agency attention to these important topics. By now the reader should have noted the existence of a paradox: most H-1B visa holders in the biotechnology and high-tech industries (and presumably the pharmaceutical and medical device industries) are coming from U.S. institutions, not from foreign graduate schools. So why are not more of the U.S. national student output from graduate schools entering industry? Is there something special about the foreign national that predisposes her/him to enter industry?

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