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Recent data from tech provider PassRight suggests that US multinational companies lack the technical workers needed to perform in the United States. To combat the problem, companies are increasingly moving work overseas by establishing hubs in countries where IT and software engineers are more accessible.
The problem of the shortage of tech talent in the United States has been recognized by politicians and thought leaders for many years, but it shows no signs of a coherent solution. Silicon Valley is still facing a shortage of foreign tech talents so notable that, on any given day, there are over 10,000 open positions just for full stack software engineers. Data from the Bureau of Labor Statistics also projects that a further 1.4 million positions will be open in computing, and an estimated 1 million technology jobs will go unfilled by 2020.
It’s unlikely that the problem is being caused by a lack of career prospects in the field. The average annual salary for a mid-senior software engineer in the San Francisco Bay Area is $140,000, almost three times the median household income in the United States. According to Liran Jakob Rosenfeld, CEO of PassRight, the solution is not just to educate more engineers but to bring the top talent from the around the globe to Silicon Valley. This line of thought is shared by many experts.
Even President Trump, often staunchly opposed to immigration, recognizes the importance of bringing in foreign talent. Just last month, in a Tweet regarding US immigration, he stated, “We want to encourage talented and highly skilled people to pursue career options in the US.”
The O-1 Visa is in place to make it easy for highly-qualified individuals to get a visa to work in the United States, but there are still too few people applying and being accepted for this. According to Rosenfeld, the hefty size of the problem is also the size of the opportunity. He believes that there is an abundance of talented and qualified engineers eager to work in Silicon Valley, but that this talent pool faces too many roadblocks and daunting immigration policies.
To combat this problem, PassRight is reducing the obstacles facing foreign talent who qualify for the O-1 Visa by financing their immigration costs in exchange for a percentage of their salary. PassRight believes this income sharing agreement model is ideally suited to the industry due to the high wages on offer. The company provides several financing models, one of which is an annual repayment of 17 percent of salary, capped at $25,000.
It remains to be seen if income sharing agreements are the solution to the tech talent problem. While such agreements would, undoubtedly, make up for the lack of tech talent in the short term, they might also start a long-term trend of outsourcing that could be detrimental to the American worker. Perhaps this problem could be mitigated before it got out of hand, but nothing is certain in the current environment.
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