Policy Groups Debate Existence of STEM Worker Shortage

As Congress considers comprehensive immigration reform, policymakers are debating the effect of high-skilled immigration on the U.S. economy. Amidst the fervent discussion, the question has been raised of whether or not there is a shortage of domestic high-skilled workers, especially those in the field of science, technology, engineering and math; a question that now is being fiercely debated by two renowned policy groups. Researchers from the Economic Policy Institute (EPI) recently made the claim that the U.S. has a sufficient supply of workers to fill the demand of STEM occupations. In response, researchers from the Information Technology and Innovation Foundation (ITIF) published a point-for-point rebuttal to the EPI's report, joining a chorus of others in staunch opposition of the EPI's interpretation of the statistics.

In their paper Guestworkers in the High-Skill U.S. Labor Market, the EPI refutes the notion of a STEM worker shortage and makes the following three claims: The U.S. has a sufficient supply of workers in STEM; IT employment and wages have been relatively stable and weak, indicative of low demand for workers; and the IT workforce contains a large number of guestworkers who depress the market through low wages.

Using NSF Science and Engineering Indicators and Bureau of Labor Statistic's (BLS) definitions of STEM occupations, the EPI estimates that only 4.4 percent of the total U.S. workforce is in a STEM field, and that 2.5 percent of college graduates enter a STEM job one year after graduation. They also claim the number of STEM graduates can exceed the number hired each year nearly two to one, to purport that there is a robust supply of domestic STEM workers in the workforce. Employment and wages have been responsive to economic conditions, but have been relatively weak and hovering around late 1990s levels, which they claim is indicative of a weak demand for workers. They conclude that although the number of guestworkers in the IT market has increased dramatically over the past few decades, wages have remained stagnant, suggesting their presence has not contributed to wage increases.

ITIF addresses each of the EPI's core claims and its assertion of a high supply and low demand by providing alternative interpretations of education and census data to argue that there is a shortage of high-skilled workers. They first counter EPI's claim that there is a vast supply of STEM workers because of their inability to find positions after graduation. Rather, ITIF points to statistics from the National Center for Education that indicate STEM graduates are 8.7% more likely to work in a field related to their major and generally will perform much better in the labor market compared to the average employed graduate with a bachelor's degree.

Using Census and BLS' Current Population Survey data, ITIF then refutes the EPI claim that stagnant wage growth suggests a weak demand for IT workers by pointing out that IT job growth in the U.S. outpaced general job growth by nearly 20% between 2003 and 2010. The authors counter the EPI's third claim that low wages depress the STEM worker supply by clarifying that guestworkers do not necessarily receive lower wages. The average H-1B worker in an IT occupation earned a starting annual salary of $96,674 in 2011 compared to the average IT occupation salary of $82,525, as reported by the BLS.

Click here for ITIF's report The Real Story on Guestworkers in the High-Skill U.S. Labor Market...

Both reports have garnered a number of supporters, and others have added further analysis to the debate including Linda Rosen of Change the Equation who feels the EPI did not consider the increasing demand for STEM skills outside of STEM fields, as shown in a 2011 study by Georgetown University. While the immigration debate is complex and nuanced, there should be a continued focus on improving the STEM workforce to remain competitive in the global economy, shortage or no shortage in the workforce.