Newspapers from coast to coast covered last week’s announcement by the U.S. Citizenship and Immigration Service that they had received more than 150,000 applications for the 65,000 H1B visas available this year. The more startling aspect of the announcement was that it was made the same day the program opened for the year.

For candidates that missed this opportunity, it means the next window to apply for an H1B visa is April 2008 for a start date in October of next year. As Bill Gates pointed out in his congressional testimony last month, "America's immigration policies are driving away the world's best and brightest precisely when we need them the most."

The H1B program was designed to allow companies to hire immigrant workers into jobs they are unable to fill with local candidates. Lest you think the demand for H1B visas we're experiencing is being driven by unemployed foreigners that want to come to the United States, the H1B process requires the applicant have a pending job offer from a U.S. company before applying. An H1B visa is good for 6 years, and the program has been instrumental in allowing the U.S. to retain its competitive edge in the development of key technologies.

Ten years ago when the information technology sector was a fraction of the size it is today, the H1B allocation was 65,000 per year. Eventually, this number peaked at 195,000 in 2003. That year, in response to the dot-com crash, the limit was slashed back to the 65,000 figure of 10 years ago.

Fortunately for the tech sector and the U.S. economy, the IT sector has recovered from the crash and is now seeking to hire qualified applicants wherever it can find them. Nearly all technology companies have seen the cost to identify and hire qualified applicants increase dramatically in the last 2 years. The pressure to hire the people that allow us to grow our businesses (and provide even more employment opportunities) has put unprecedented pressure on our recruiters and, consequently, the H1B program. Opponents of the H1B program expansion point out there is no requirement that employers exhaust their local sources of candidates before looking overseas.

That claim is accurate, and there's a good reason for it. From a business perspective, all employers attempt to minimize their recruiting costs. If high-tech employers could fulfill all their recruiting needs locally, they would, and Congress wouldn't need to mandate it. The only reason PGP Corporation or any other company decides to hire an H1B applicant is that he or she is the person we need for the job. This issue has been exacerbated by the fact that 40 percent of the Ph.D.s granted in computer science and engineering by U.S. universities go to foreign-born students. If we are to remain competitive, U.S. companies need to have the same access to this talent pool as Asian and European companies.

PGP Corporation has had open engineering positions since we restarted the company 4 years ago. If it weren't for the H1B program, we would have been unable to fulfill our customer's expectations even to the extent that we have. In an era when the hottest pitcher in baseball is Japanese and the Most-Valuable-Player in professional basketball is Canadian, it's time we admitted that all parts of our economy compete on a global stage. To remain competitive, we need to significantly rethink our immigration policies not only as they relate to the H1B program, but also to the processes we use to grant permanent residency to people that drive the U.S. economy today.

Those of us that run technology companies have understood just how broken the H1B program is for some time. We're currently living in a world where the U.S. is educating the majority of engineers in the world, but we are unwilling to allow U.S. companies to hire many of these graduates. Although this situation makes life difficult for companies like PGP Corporation, it has potentially tragic consequences for the overall competitiveness of the U.S. economy. If last week's outcome is any indication, a number of companies that depend on the H1B program will be moving projects and jobs overseas where the people who want to do these jobs can have them.

PGP Corporation currently has technical operations in both North America and Europe. If U.S. immigration policies do not change to comprehend the realities of the global economy, we, like most other technology companies, will be forced to expand our foreign development centers to remain competitive.

Crafting a politically acceptable solution to this problem, particularly in an extended election cycle, won't be easy. Ignoring the problem will not make it go away, however, and will only cause even more jobs to move offshore. Keep in mind that for every engineer a technology company hires, they also hire two to three support and customer-facing personnel. If the engineering jobs move offshore, so will many of these other jobs. I would urge Congress and the Labor Department to begin collaborating immediately to find a way to solve this problem before we permanently impair our ability to compete in the high-growth strategic sectors this law affects.

- Phil