Students fear for job prospects in U.S. visa crunch

BOSTON (Reuters) - As foreign students prepare to graduate from U.S. universities this spring, many worry that a record number of applications for U.S. skilled-worker visas may cause them to lose jobs they have already been offered.

Fresh university graduates are vulnerable to being rejected for the H-1B visas designated for skilled workers. A record 150,000 H-1B applications were filed in one day this week, nearly double the number U.S. authorities are allowed to grant in a given fiscal year.

The flood of applications raised anew a domestic debate over quotas for the entry of foreign workers.

Visa shortages could ultimately discourage overseas students from studying in the United States over other countries with fewer restrictions on working visas for graduates, said Kay Clifford, associate director of the International Center at the University of Michigan.

“I’m concerned that this will be discouraging to international students,” she said. “They are worried about their futures. They are worried about the impact on their careers.”

In most cases, the government allows students to stay in the country for a year, granting them an F-1 visa to work in a field related to their area of study.

But for many students that Clifford deals with, the ability to stay in the country and work for several years is a key component of their decision to study in the United States.

Some employers will not bother hiring graduates unless they can get them an H-1B visa from the start of their employment, said Ted Ruthizer, head of the business immigration practice for New York law firm Kramer Levin Naftalis and Frankel.

If an employer hires a graduate this spring and is not able to get an H-1B this year, the employee will only be able to work in the United States for 12 months.

Even if that employee manages to get an H-1B when the window opens again in April 2008, he or she would not be able to start work again until October 2008, leaving a gap where the worker would have to go on leave or work outside the country.

The U.S. government will grant 65,000 H-1B visas this fiscal year to people with at least the equivalent of an undergraduate degree and expertise in a specialized field such as engineering or computer programming. An additional 20,000 visas are reserved for those with advanced academic degrees.

That quota is “woefully inadequate,” Ruthizer said. “I think everybody was caught off guard. It’s a mess.”

Corporate lobbyists have tried to raise that threshold for years, citing a shortage of home-grown talent in the sciences.

National Semiconductor Corp., a maker of computer chips, said it had planned to hire 120 employees in the United States this year, 12 of whom require H-1B visas. But given the imbalance between the number of applications and visas to be issued, it is unlikely all of them will get work credentials.

“In many cases we are trying to convince kids to stay on in school so they don’t get into that kind of predicament,” said National Semiconductor Vice President Eddie Sweeney.

While it is relatively easy to renew an H-1B visa for an employee who already holds one, other expert workers are also vulnerable.

For example, a Belgian scientist employed by National Semiconductor on a temporary visa will have to leave the country if he does not win a longer-term work permit through a lottery, Sweeney said.

Some employers feel it is no longer worth the hassle to obtain U.S. visas for their staff.

Internet entrepreneur Rakesh Mathur spent years securing visas to hire engineers for a string of companies he founded in Silicon Valley.

With his current venture, a Web technology company known as Webaroo, he decided to hire the bulk of his workers overseas, with 15 employees in the United States and about 100 in India.

“The demand for talent is very real,” he says. “And there is a shortfall of trained talent in the United States.”