Skip to main content

Immigration Reform and US Manufacturing

Fighting in the U.S. Congress has once again raised strong feelings about immigration policies. The human drama of people climbing border fences, perishing in the Arizona desert, or being held captive in illegal sweatshops feels threatening to some and heartrending to others. The numbers of immigrants, legal and illegal, in the country and the masses who want to enter the country need to be reckoned with.

American Flag with Manufacturing Facility in Background

 

Immigration: Who benefits?

 

Fighting in the U.S. Congress has once again raised strong feelings about immigration policies. The human drama of people climbing border fences, perishing in the Arizona desert, or being held captive in illegal sweatshops feels threatening to some and heartrending to others. The numbers of immigrants, legal and illegal, in the country and the masses who want to enter the country need to be reckoned with.

 

How does immigration affect manufacturing?

 

Doug Oberhelman, Illinois-based Caterpillar CEO, recently told the Illinois Business Immigration Coalition (IBIC) that the company has problems retaining and recruiting employees at all levels of the company. They need talent from abroad, he said, but the difficulty of obtaining visas is a serious roadblock.

 

In 2012, the IBIC assembled a blue-ribbon task force, which included university presidents, community organization leaders, manufacturing CEOs, former mayors and governors. The group shared their experiences, commissioned research, and examined the issues. In the 60-page report they issued this year, the US Economic Competitiveness At Risk: A Midwest Call to Action on Immigration Reform, they make the business case for immigration. Here are some of their findings:

 

Immigrants offer scientific and technical skills in short supply. (See my article, Technical skills in short supply.) We need the doctors, scientists, engineers, and computer programmers who have trained both abroad and at our universities. Sixty to 70% of engineering and computer science students in North American universities’ advanced degree programs are in the country on temporary visas. Increasingly, they are choosing to take their skills home rather than deal with the INS. Immigrants do more than fill jobs—they create jobs. In recent years, entrepreneurs from other countries have started up some 25% of new and fast-growing high-tech firms.

 

Let’s look at one example: When WCCO Belting lost its last reliable U.S. supplier of reinforcement textiles for its conveyor belts, and without experience in global sourcing, the company needed help. At a nearby university they found an Indian graduate student who had sourcing and sales experience with industrial textiles in Asia and Africa. He was uniquely qualified for the company’s needs, and joined the company upon graduation. The CEO credits his new supply chain executive for helping the firm expand from 60 to 200 employees with 60 % of its sales abroad. The Indian-born former student implemented new quality control measures and helped develop new products. Better price negotiating knowledge helped cut materials costs dramatically.

 

The catch? His H-1B visa covered only a few years. The wait for his green card is likely to take an estimated 8 to 80 years. While his visa can be renewed annually and his wife, with her three advanced university degrees, can stay in the country, their three teenaged children will have a difficult struggle to stay once they reach 18.

(Read more on the H1B Visa and Manufacturing)

 

In addition to knowledge workers, we need less-skilled immigrants for jobs that employers can’t fill, even at times of high unemployment. When a company brings an influx of people from diverse cultures into a small town, it does create the potential for conflict. Leaders from manufacturing companies can ease acceptance by getting involved in community groups, bringing people together, and helping to dispel unfounded fears.

 

Cargill Meat Solutions in Iowa did just that. In the 1990s, the company was finding it difficult to recruit workers locally for the hard repetitive work of butchering a 275-pound hog into bacon and pork chops. As the company reached out to the Southwest, it was largely Latino workers who answered the call. They now make up nearly half of the facility’s 2,250 employees.

 

The company and city leaders helped the community accept change as the rapid increase in the Latino population changed the town’s schools and neighborhoods. The mayor set up a diversity network encompassing schools, churches, police, business, and government. Cargill sponsored soccer teams. Classes in both English and Spanish became available. Cargill plant managers and supervisors learned fluent Spanish, and helped local residents better understand the new workers.

 

There are undeniable challenges associated with immigration. Yet, with the right policies, information, open discussion, and innovation, we could better leverage immigration for economic development and a richer culture.

 

Read more of the IBIC’s finding on immigration and manufacturing)

 

Karen Wilhelm has worked in the manufacturing industry for 25 years, and blogs at Lean Reflections, which has been named as one of the top ten lean blogs on the web.

 

 

 

    April 22, 2013

    Some opinions expressed in this article may be those of a contributing author and not necessarily Gray.

    Get the Latest.