For foreign grads, some hope for employment in the U.S.February 20, 2014: 10:24 AM ET
The Kelley School of Business at Indiana University has introduced an initiative aimed at bringing together the school's graduates, corporate recruiters, and an immigration law firm to breeze through the maze of H-1B visa paperwork and regulation.
FORTUNE -- The United States is training a growing number of foreign students at its universities, but many are sent packing overseas after graduation day, a result of an arcane visa process that keeps many employers from even giving a talented foreign graduate a second glance.
In an effort to streamline the complex immigration process that arises when U.S. employers want to hire international students, the Kelley School of Business at Indiana University has introduced what it calls the IU Immigration Bridge Program, an initiative aimed at bringing together the school's graduates, corporate recruiters, and an immigration law firm to breeze through the maze of H-1B visa paperwork and regulation.
The program, which the school's associate director of career services Paul Binder says will "bring jobs to students sooner rather than later," will assist its first class of graduates this spring.
Binder says that the program was not started to address a problem at the school. He maintains that Kelley's graduates have little trouble finding employment. Last year, 93% of its graduates had a job offer within three months of leaving school. (Binder did not know what that percentage was among international students.) Instead, IU created the program, he says, to provide resources to ease the visa process that can often delay or hinder the hiring of international students. Once an employer learns that a prospective hire needs authorization to work in the U.S., it "sometimes steps back a little," Binder says, "They don't want to do it because of the perceived high cost and paperwork."
For international students to remain in the U.S. after graduation, an employer must sponsor them with an H-1B visa for skilled foreign workers. But because the visa costs an average of $4,000 and has lengthy process times, employers -- especially small and midsize firms that lack a large legal staff -- shy away from pursuing international job candidates, even if they're well qualified, Binder says. Through the Bridge Program, IU has teamed up with immigration firm Fragomen, Del Rey, Bernsen & Loewy to help students and their potential employers tackle the cumbersome process. Once international students receive significant interest from an employer or an actual job offer, their visa matter is referred to Fragoman, and the firm handles it on behalf of the employer at a discounted rate. (Binder declined to disclose the price.)
The concept of the program -- one of the first of its kind -- points to the growing competition among international students for working visas. According to the Brookings Institution, since 2000, the U.S. has witnessed a 49% increase in the number of foreign students studying at its universities -- 60% of that growth can be attributed to China; 23% to India. Figures from the National Center for Education Statistics show that the percentage of "non-residents" in undergraduate and graduate programs has inched up in recent years. Just over 2.5% of undergrads were foreign students in 2012, compared to 2.15% in 2007. Foreign students made up 11.4% of enrollees at graduate programs in 2012, up from 11% five years ago.
Meanwhile, the number of visas available to keep this growing number of students in the country after graduation has remained stagnant since 2007, when 20,000 visas specifically for graduates of U.S. universities were added to the previous cap of 65,000.
During the recession, not all 85,000 visa spots were filled, but now that the economy is recovering and companies are hiring again, there's a surplus of applicants. Visas are issued on a first-come, first-served basis, and during the most recent filing period for H-1Bs that began last April, the cap was reached within a week, says Neil Ruiz, associate fellow at Brookings. Visa recipients were determined by lottery. Forty-thousand applicants were rejected with no option but to try again this year.
The visa process can easily deter employers from extending a job offer to international students. "Private employers look to universities like Indiana and Purdue to train students in STEM fields, but then they go to recruit and realize that many of those students are foreign and will have to compete in a national competition for a visa," Ruiz says. "What the current immigration system does, especially for foreign students who really want to stay and work, is create a lot of uncertainty. And for the economy to grow, uncertainty is bad."
The Brookings Institution found that in 2010, there were 342,968 incoming foreign students who accessed the F-1 visa to pursue bachelors, masters, or doctoral degrees. In that same year, just 26,502 of the 76,627 new H-1B work visas went to U.S. foreign students, according to Brookings. What happens to foreign students who don't secure H-1B visas is unclear. "In the U.S., we don't have an exit system for immigration," Ruiz says. "You get stamped to come in, but we don't know if someone left, and if someone leaves, we don't know why."
It's not surprising, then, that IU wants to make it as easy as possible for foreign students to find work in the U.S. "IU will now have the opportunity to fill the void of asymmetric information about the visas," Ruiz says. There are a lot of hurdles for students and employers to clear in order to obtain a visa. For Indiana University students, at least misinformation won't be one of them.