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With High Youth Unemployment, Making Sense of Summer Work Visas For Foreigners

August 17, 2012 at 12:00 AM EDT
Since the 1960s, the State Department has sponsored young foreigners for temporary, low-wage summer jobs in the U.S. But with high youth unemployment, some believe the program takes summer jobs away from American youth. So is the program's motivation truly 'good will' or a source of cheap labor? Paul Solman reports.

JEFFREY BROWN: Next, who’s filling that summer job?

NewsHour economics correspondent Paul Solman looks at a program bringing in student workers from around the world. It’s part of his ongoing reporting, Making Sense of financial news.

EMMETT WOODS, Emmett’s Castle: We’re going to die for this game today. And we want to win it.

PAUL SOLMAN: Emmett Woods, pumping up his Gaelic football team before a recent home match in Rockland County, N.Y.

EMMETT WOODS: This is our field. This is Rockland’s field. And we control this field.

PAUL SOLMAN: Among Woods’ recruits, Irish students here for the summer to play and work, like Cormac McLeron.

CORMAC MCLERON, Ireland: He can help us with accommodation, sort us out with jobs, and all we had to do is just play football for his team.

PAUL SOLMAN: McLeron is one of some 85,000 collegians from 190 countries with J-1 visas, thanks to the State Department’s Summer Work Travel Program, launched during the Cold War to promote goodwill abroad.

But with youth unemployment now in double digits, U.S. firms hiring foreigners, even if just for the summer, is causing bad will at home.

Jerry Kammer of the Center for Immigration Studies, known for its skepticism about the benefits of immigration.

JERRY KAMMER, Center for Immigration Studies: They are disenfranchising young American workers who need these jobs. Their motivation is not good international relations. Their motivation is the bottom line.

PAUL SOLMAN: Not so, says Robin Lerner, who oversees the program at the State Department.

ROBIN LERNER, U.S. State Department: One of our most effective tools in engaging with other countries is through people-to-people contact. They’re unskilled seasonal and temporary jobs.

PAUL SOLMAN: So, goodwill or cheap labor?

Emmett Woods employs 25 to 30 Americans at the modestly named pub Emmett’s Castle. But he’s also hired Cormac McLeron to wash dishes, to lug lager to the cellar…

EMMETT WOODS: I hope you ate your Wheaties.

PAUL SOLMAN: …to set tables on the patio.

Woods says McLeron will take home a happy picture of America and will foster global goodwill here.

EMMETT WOODS: I like to put a little bit of Irish charm and humor into it.

PAUL SOLMAN: McLeron also thinks there’s a payoff at the pub.

CORMAC MCLERON: If they’re coming to an Irish bar, maybe speaking to the real Irish people, like, it sort of heightens the experience, I suppose.

PAUL SOLMAN: Even if they don’t always speak brogue.

CORMAC MCLERON: Most Americans are struggling to make us out. So they are.

PAUL SOLMAN: So, yes, we went goodwill hunting in New York and found it, found it at a swim club in Manassas, Va., too, where Chinese lifeguard Eric Wang was buffing his English while learning about America.

ERIC WANG, China: Americans like to make jokes, always make jokes with me, but I didn’t understand what they said.

PAUL SOLMAN: So, they laugh, but you’re not exactly sure why they’re laughing?

ERIC WANG: Sometimes they laugh, but I just stand there, and they told me, it’s a joke. I just ah-ha-ha like this.

PAUL SOLMAN: Doug Winkler’s been hiring J-1s like Wang for a decade to lifeguard at the 225 pools he manages in the D.C. area.

DOUG WINKLER, manager: We use about 50 percent we say domestic, American guards, and 50 percent international, and it’s the mix of both.

PAUL SOLMAN: He hires J-1s not just because they add cultural breadth, he says.

DOUG WINKLER: The international students have a tremendous work ethic. They show up on time, and they work hard, and they work to the end of their shift, and they often inquire, what else can I do?

PAUL SOLMAN: Key question: Isn’t this taking jobs away from Americans?

DOUG WINKLER: I really don’t think so. We have a tremendous recruiting effort. We use Craigslist. We use some advertising agencies. We do high schools.

We do not get enough American applicants to fill all the positions. I’m a firm believer that, in the areas where this high youth unemployment exists, that some of those youths don’t want jobs.

PAUL SOLMAN: Company vice president Chris Waters says they have got too much else going on.

CHRIS WATERS: Prom, baccalaureate, graduation, beach week, Fourth of July, vacation, football, lacrosse, everything else, all the fall sports.

PAUL SOLMAN: In Rockland County, restaurateur Woods had a more basic complaint.

EMMETT WOODS: I couldn’t get an American to wash dishes. I find it very hard to get American help that would do some of the jobs.

PAUL SOLMAN: But Jerry Kammer says employers like Woods and Winkler overstate the efforts they make, downplay the benefits to them.

JERRY KAMMER: There are a lot of employers who know that they have a smoking deal with this program. Why recruit when you have recruitment done for you at no cost by the Summer Work Travel Program?

This program provides no incentives for American employers to hire American kids. It provides plenty of incentives for American employers to hire the SWT kids.

PAUL SOLMAN: The main incentive, claim the folks at Crystal Aquatics, is cost. They hire all-American at their 30 Northern Virginia pools, and vice president Jeff Collins says it hurts business.

JEFF COLLINS, Crystal Aquatics: Companies that hire international lifeguards get an 8.45 percent payroll tax savings by not paying federal unemployment tax, Medicare, and Social Security.

PAUL SOLMAN: As for American workers being hard to find, Sean Davidson has worked here for five years.

SEAN DAVIDSON, Crystal Aquatics: I have people who will come to this pool and they — you know, they ask if they can get a job to work here, and we have to say, no, that we’re full.

PAUL SOLMAN: Crystal Aquatics would bring on more locals, says Collins, if they could win more pool management contracts, but:

JEFF COLLINS: When we compete against companies that hire international lifeguards, we are consistently higher or at best equal with them. It’s hard for us to compete with the international lifeguards.

PAUL SOLMAN: In nearby Manassas, Winkler admitted his foreign hires are less expensive than Americans, but says there are hidden J-1 costs.

DOUG WINKLER: It’s a tremendous effort, requires a lot of people. And they will arrive in the middle of the night. They’re in a foreign country. And all they know is to call our phone number.

PAUL SOLMAN: Still, cheaper is cheaper, and must be part of the reason companies hire J-1s.

But if you offered $12 an hour, you get more American workers?

DOUG WINKLER: But I would have no business.

PAUL SOLMAN: It’s the standard race-to-the-bottom economic argument against foreign workers in general, that they put downward pressure on low-wage workers.

But Michael McCarry, who lobbies for firms that take part in the Summer Work Travel Program, claims concerns about its economic impact are overblown.

MICHAEL MCCARRY, Alliance for International Educational and Cultural Exchange: The exchange programs are very unlikely have any impact on American employment because of the small number of exchange participants, as compared to the enormous size of the American economy.

PAUL SOLMAN: To Jerry Kammer, however, the program’s problems go beyond lost jobs and low wages, all the way to exploitation.

JERRY KAMMER: There are a lot of employers who take no interest in their cultural experience, and just want to get the work out of them. And the kids are happy, in many instances, to work 12 hours a day, because if you’re from Moldova and you’re making $8 an hour, that’s a lot of money. It’s like an American kid going overseas and making $60 an hour. That’s the differential.

MAN: The effort to bring Hershey’s to justice has officially begun today!


PAUL SOLMAN: The most visible example of apparent exploitation came last summer. Hundreds of J-1 summer workers at a Hershey chocolate warehouse in Pennsylvania walked off the job, claiming overwork and underpay.

The State Department banned the firm that placed the workers. Robin Lerner says, this spring, they beefed up protections for foreign workers and Americans, too.

ROBIN LERNER: Our May rule includes language that requires that no participant be placed in a job where an American worker is displaced and where there have been layoffs and strikes in the past 120 days.

PAUL SOLMAN: Lerner emphasizes that, at most places, the original purpose of the Summer Work Travel Program is being served.

ROBIN LERNER: We have these university students that are coming here, and they will one day be something in their country. They understand our culture. They understand our customs, and they will be sympathetic and friendly toward us. And that’s important.

PAUL SOLMAN: The kids we met certainly seemed to like America so far.

Ihor Bilousov came from the Ukraine.

IHOR BILOUSOV, Ukraine: If I ask you something, for example, in the shops, you answer me with pleasure. And that is nice that you are so friendly and nice people.

PAUL SOLMAN: As for problems, Cormac McLeron’s seem downright trivial.

CORMAC MCLERON: I can’t get used to some of the American words, like…

PAUL SOLMAN: Like what?

CORMAC MCLERON: Like soda and garbage. It just don’t go right. In Ireland, we just call it rubbish and Coke. Even the youth around here are using words like whack and just all this sort of stuff. And sometimes you just do not know what it means. You don’t know if it’s a good thing or a bad thing.

PAUL SOLMAN: You don’t know if it’s a good thing or a bad thing.

When it comes to the J-1 Summer Work Travel Program, we wound up with pretty much the same ambivalent conclusion, goodwill for sure, but costing at least some young American jobs.

JEFFREY BROWN: And so which countries send the most summer workers to the U.S.? You can find that and an interactive map showing where in America they’re going. That’s on Paul Solman’s Making Sense page.