As Howard University Professor Ron Hira has observed, “unsubstantiated claims that there is a significant shortage of STEM talent have been a running feature of STEM workforce policy discussions” for decades. As he suggests, the most straightforward way to test for a “shortage” is to report wage and benefits trends over time in the occupations of interest. After all, if demand is really outstripping supply, employers will pay even more compensation to recruit and retain scarce workers. So, what does the data show?  

One of the best sources of data on worker compensation is the Employer Costs for Employee Compensation data produced by the BLS. Normally, the BLS does not publish ECEC data specifically for STEM workers. However, in response to a custom data request, the BLS provided the Center for Immigration Studies with trends in wages and benefits for STEM workers. The bottom line is that STEM workers have experienced little to no growth in overall compensation.

From 2008 to 2023, the ECEC data showed that inflation-adjusted hourly compensation (wages and benefits combined) for STEM workers in the U.S. increased just 2.3% over 15 years. That is just 0.15% per year on average. Looking specifically at wages, the ECEC numbers show barely any increase at all, and benefits increased just 7.4% from 2008 to 2023 (or 0.5% per year).

In the most recent years, compensation has actually fallen. It was 7.1% lower in 2023 than in 2019 before COVID-19, with wages down 7.6% and benefits down 6.2%. If employers are desperate for more STEM workers, why have they been lowering the compensation offered?

Other data tell the same story. Analysis of the Census Bureau’s American Community Survey, which allows us to break out wages for workers in science, technology, engineering, and math separately, also shows very modest wage growth for two decades and an outright decline in recent years.

If demand for STEM workers was outstripping supply, then wages and benefits would be rising rapidly as employers try desperately to hold on to scarce workers and recruit new ones. It is Economics 101. The lack of rapid increases in compensation is clear evidence that there is no “shortage” of STEM workers despite all the rhetoric to the contrary. What do advocates for more foreign STEM workers say about this? As far as I can tell, they say next to nothing. This includes the 307 pages of the new National Academies report mentioned above, which has no discussion of trends in compensation.

The availability of workers with STEM degrees also suggests no “shortage.” ACS data indicate that in 2022, there were 5.4 million working-age people with a science degree not working in any STEM job; among technology degree holders, it was 1.6 million; for engineering, it was 3.7 million; and it was 825,000 in math. On its face, it appears America has enough STEM-trained people, but a large share cannot get jobs in their field or choose not to work in them.

There is certainly evidence that immigration is crowding out native-born Americans from STEM jobs. Research on the H-1B skilled worker program by Notre Dame professor Kirk Doran and his coauthors offers the best evidence of this. If immigrant workers are truly exceptional talents that do not displace natives and so stimulate the economy as many contend, then the firms that win the H-1B lottery each year should increase their employment relative to the lottery losers. But Doran and his coauthors found that the firms that won the lottery ended up employing fewer workers than the firms that lost. For every two H-1B visas the firms won, three other workers were crowded out.

Doran and his coauthors also found little evidence that lottery-winning firms are any more innovative than the losing firms. A 2017 National Academies study on immigration praised a draft version of this research, observing that its method is “particularly clean” due to the use of a natural experiment. This and other research is certainly consistent with the possibility that one reason so many STEM-trained Americans do not work in STEM jobs is the enormous number of immigrants allowed into the country.

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The ACS shows that the foreign-born now accounted for 29% of all STEM workers in 2022, roughly double the foreign-born share of the total U.S. population. Since 2010, the total number of foreign STEM workers has doubled. The present system certainly allows an enormous number of skilled workers into the country. With the foreign-born share of STEM workers approaching 1 in 3, it seems reasonable to ask if the U.S. is becoming too dependent on foreign labor.

Time and time again, assertions that there is a shortage of STEM workers are shown to be false. If there were such a shortage, wages and benefits would be rising rapidly, which is simply not the case. If we want more Americans to get STEM degrees or we want to lure those who have such degrees back to their fields, basic economics suggests a very simple solution: Let wages and benefits rise. Although these jobs have only roughly kept pace with inflation in recent decades, they continue to be relatively good-paying. Why not increase the share of such jobs going to Americans rather than bring in ever more foreign workers?

Steven Camarota is the director of research at the Center for Immigration Studies.