What STEM Shortage?

by Steven Camarota
The sector isn’t seeing wage growth and has more graduates than jobs.

The idea that we need to allow in more workers with science, technology, engineering, and math (“STEM”) background is an article of faith among American business and political elite.

But in a new report, my Center for Immigration Studies colleague Karen Zeigler and I analyze the latest government data and find what other researchers have found: The country has well more than twice as many workers with STEM degrees as there are STEM jobs. Also consistent with other research, we find only modest levels of wage growth for such workers for more than a decade. Both employment and wage data indicate that such workers are not in short supply.

Reports by the Economic Policy Institute (EPI), the RAND Corporation, the Urban Institute, and the National Research Council have all found no evidence that STEM workers are in short supply. PBS even published an opinion piece based on the EPI study entitled, “The Bogus High-Tech Worker Shortage: How Guest Workers Lower U.S. Wages.” This is PBS, mind you, which is as likely to publish something skeptical of immigration as it is to publish something skeptical of taxpayer subsidies for the Corporation for Public Broadcasting.

RAND’s analysis looked backward in time and found, “Despite recurring concerns about potential shortages of STEM personnel . . . we did not find evidence that such shortages have existed at least since 1990, nor that they are on the horizon.”

In an article entitled “The Science and Engineering Shortage Is a Myth” for the March issue of The Atlantic, demographer Michael Teitelbaum of Harvard Law School summarizes the literature on STEM. “No one has been able to find any evidence indicating current widespread labor market shortages or hiring difficulties in science and engineering occupations that require bachelor’s degrees or higher,” he points out. Teitelbaum is one of the nation’s leading experts on STEM employment, former vice president of the Sloan Foundation (a philanthropic institution essentially devoted to STEM education), and author of Falling Behind? Boom, Bust, and the Global Race for Scientific Talent, just published by Princeton University Press.

In looking at the latest government data available, my co-author and I found the following: In 2012, there were more than twice as many people with STEM degrees (immigrants and native-born) as there were STEM jobs — 5.3 million STEM jobs vs. 12.1 million people with STEM degrees. Only one-third of natives who have a STEM degree and have a job work in a STEM occupation. There are 1.5 million native-born Americans with engineering degrees not working as engineers, as well as half a million with technology degrees, 400,000 with math degrees, and 2.6 million with science degrees working outside their field. In addition, there are 1.2 million natives with STEM degrees who are not working.

Meanwhile, less than half of immigrants with STEM degrees work in STEM jobs. In particular, just 23 percent of all immigrants with engineering degrees work as engineers. Of the 700,000 immigrant STEM workers allowed into the country between 2007 and 2012, only one-third got a STEM job, about one-third got a non-STEM job, and about one-third are not working.

Wage trends are one of the best measures of labor demand. If STEM workers were in short supply, wages would be increasing rapidly. But wage data from multiple sources show little growth over the last 12 years. We found that real hourly wages (adjusted for inflation) grew on average just 0.7 percent a year from 2000 to 2012 for STEM workers, and annual wages grew even less — 0.4 percent a year. Wage growth is very modest for almost every category of STEM worker as well.

So if there is a superabundance of native and immigrant STEM workers and little wage growth, and STEM immigration already exceeds the absorption capacity of the STEM labor market, why are there calls to allow in even more? The answer, put simply, is greed and politics.

The businesses that want more immigration would get more workers to choose from, holding wages in check and increasing their bargaining power over their employees. What’s not to like? The Republicans listen to their corporate donors in Silicon Valley and elsewhere and respond by promising to increase STEM immigration even further.

The motives of Democrats are little more complicated. They like the corporate donations as well, but even better they see increasing STEM immigration as a bargaining chip to get what they really want from Republicans — amnesty for illegal immigrants. Democratic representative Luis Gutierrez has said as much. Democrats also know that Indian and East Asian immigrants who comprise most foreign STEM workers are generally liberal in their policy preferences and vote overwhelming Democratic — a nice bonus.

In addition to the collusion of both parties, there are other reasons why the idea of a STEM worker shortage is given credence despite all the evidence to the contrary. First, the poor average performance of American high-school students in science and math relative to other First World countries creates the perception that we are not producing enough scientists and engineers. Low average test scores relative to other countries are certainly troubling but, as the EPI study mentioned above makes clear, this does not prevent us from producing a large number of high-quality students. America is a huge country and the STEM workforce is small. It grew by only 1 million in the last 12 years. This is less than 5 percent of the more than 20 million students who got a bachelor’s degree over this time period, to say nothing of the millions more who earned a graduate degree.

Another reason that the “we need more STEM workers” argument is taken as gospel is that it is endorsed by many of America’s most prominent billionaire entrepreneurs, such as Bill Gates and Mark Zuckerberg. Their vested interest in holding wages down and improving their bargaining power vis-à-vis their workers goes unmentioned by the media that tend to just transcribe their press releases on the subject.

There is also the “xenomania,” to use my colleague Mark Krikorian’s word, of many opinion leaders — the idea that immigrants are better than the average American. As I have pointed out elsewhere, immigrants are not more entrepreneurial than natives, they are not more likely to have a job, they are not less likely to commit crimes, and they are not less likely to use welfare. Nonetheless, for different reasons some on both the right and the left believe such things are the case and reflexively support increasing immigration.

There are a number of problems with allowing ever-more foreign STEM workers into the country. First, the argument for doing so is deceptive and dishonest. Second, these are still mostly middle-class jobs and an enormous number of American students getting STEM degrees are not finding STEM jobs. Over time this fact along with a lack of wage growth can only deter Americans kids from going into these fields. Third, STEM workers are vital to national defense and having a large share of our STEM workforce be foreign-born has important national-security implications. Fourth, allowing American industry to become dependent on foreign sources of skilled labor makes industry increasingly indifferent to any problems in our schools, making it less likely we will fix them.

There may be a specific geographic area or a highly specialized field in which demand really is outstripping supply. However, it makes little sense to allow public policy to be driven by very narrow interests. If there is some special need in a highly technical field, then perhaps a narrowly focused immigration program is called for.

But overall, the data indicate that the supply of STEM workers vastly exceeds the number of STEM jobs and there has been only modest wage growth in these professions. These facts are what should inform and shape immigration policy moving forward.

— Steven Camarota is director of research at the Center for Immigration Studies.

Editor’s Note: The original version of this article identified the PBS piece cited as a news report. It was an opinion piece.