Mr. Chairman and members of the Subcommittee, thank you for the opportunity to testify today. I am Jennifer Kenney, Director of Global Deployment Shared Services at PricewaterhouseCoopers. My primary role is oversight of the firm's U.S. Immigration function. In addition, I am an international human resources project manager who works on such initiatives as orientation programs for international assignees, employee satisfaction surveys, external and internal web site development and other Global Deployment information systems.
PricewaterhouseCoopers is the world's largest professional services organization. At PwC, our people are our product. Drawing on the talents of more than 160,000 people in 150 countries, PricewaterhouseCoopers provides financial audits and a full range of business advisory services to leading global, national and local companies and to public institutions. These advisory services include accounting and tax advice; management, information technology and human resource consulting; financial advisory services including mergers & acquisitions, business recovery, project finance and litigation support; business process outsourcing services; and legal services through a global network of affiliated law firms.
Before I address our foreign national employment program, I would like to briefly summarize initiatives we currently sponsor in our U.S. firm to upgrade the skills of our current and potential American workforce and to recruit under-represented minority groups. The education of the U.S. workforce in our ever-expanding, knowledge-based economy is of critical importance to our firm and our economy. Last year, our firm invested over three million dollars in high school and college internships, scholarships and mentor programs. Through our INROADS National Internship program, PwC employs over 150 summer interns who are minority finance, accounting and management students from selected colleges and universities across the country. Our Minority Scholars Program awards 40, $5,000 scholarships each year to accounting and finance students. In addition, PwC awards between 15 and 20, $1,500 scholarships to distinguished business students who are members of the National Association of Hispanic CPAs. PwC also sponsors high school mentorship programs in over 4,000 high schools. These mentorship programs are designed to generate student interest in careers in finance, accounting and technology. Finally, PwC staff and partners are actively involved in community youth development programs such as Junior Achievement and Big Brother/Big Sister chapters in under-developed neighborhoods.
Each year PwC invests millions of dollars to train our U.S. workforce. Our extensive learning and education program includes on-the-job training, self-paced computer-based learning, and technical, managerial and diversity training programs. Each of our lines of service develop curriculum to meet the needs of their particular business. For example, our management consulting practice provides entry-level technology solutions training to new hires through its intensive 12-week ASCENT program. Through ASCENT, consultants develop IT skills in various programming languages, databases and operating systems. ASCENT students also develop necessary problem-solving and consulting skills and learn to operate effectively in cross-cultural and cross-functional work teams. Other internal, trainer-lead programs for staff include: Strategic Change Management, New World Networking, e-Business, Ethics, Leadership, Working Across Cultures, SAP, Audit Training, and Microsoft Suite and Lotus Notes software training.
Many of PricewaterhouseCoopers' clients are Fortune 100 companies. In what we call our "Global 200" portfolio, 105 clients are U.S. corporations with overseas operations. Of the remaining 95 clients in the Global 200, 85 are international firms with operations in the United States. The majority of our clients trade on U.S. Capital Markets and Exchanges (i.e., NASDAQ, NYSE, etc.). Due to these activities our clients fall under SEC regulations and U.S. financial reporting standards which require our global workforce to be knowledgeable in U.S. Generally Accepted Accounting Principles (GAAP). To ensure quality in our financial reporting services our firm employs (and often cross-trains) highly skilled accountants and tax professionals with experience in multiple markets and territories. Given our global client base, PricewaterhouseCoopers is one of the largest international deployers of resources with over 5,000 staff and partners currently working outside their home country in a PwC affiliated office. In the U.S., PwC utilizes nonimmigrant visas to temporarily transfer highly skilled international personnel, hire U.S.-educated foreign students, and to fill positions where sufficient numbers of qualified U.S. workers are simply not available. Today our U.S. firm employs over 2,000 foreign nationals, representing a little over four percent of our total U.S. workforce of 46,000 individuals. Approximately 56% of these foreign nationals hold H-1B "Specialty Occupation" nonimmigrant visas, 41% hold L-1 "Intracompany Transferee" visas and 3% hold TN (Trade NAFTA) visas. On average 21% of our nonimmigrant visa holders seek permanent residence in the U.S. through employment with PricewaterhouseCoopers.
The benefits of the nonimmigrant visa program to our firm and our people are great. Our multinational clients benefit from our enhanced global capabilities and our firm is able to maintain our global competitiveness. Foreign nationals increase their technical and managerial skills and are able to transfer their knowledge to their home country. U.S. staff also benefit from the experience of working side-by-side with foreign nationals on multinational engagements, thus increasing their own skill base.
Our firm does not have identical skill sets in each of our markets, therefore we must tap the skills wherever they happen to reside to assemble the best team to service our clients. Rapid mobility of staff into and out of the U.S. is required when setting up a new office, for specialized knowledge in operations here and abroad, for professional training of the workforce, and to expose staff to a client's global operations.
The fundamental process of moving people across borders to get them where they are needed is often painful, slow, arduous and costly. This is because antiquated immigration rules and procedures -- which vary widely by country -- make it extraordinarily difficult for multinational firms to move people across borders on short notice.
In the U.S. and other countries it often can take months to clear all the bureaucratic hurdles before a temporary international assignment can begin. Deployment costs have risen significantly. Given the complicated patchwork of international procedures that we must overcome every day, no amount of money will ensure that we'll be able to place, and therefore effectively utilize, our people in the U.S. or overseas on a timely basis. In the United States, current INS and Department of Labor (DOL) processing delays make it extremely difficult for employers and potential employees to plan ahead. Employers have deadlines, contracts and workload to contend with, while potential employees must often leave other positions, sell their homes and relocate their families, and factor in tax implications of their move. Even those foreign nationals already in the U.S. may be entangled in these delays as they are unable to travel outside the U.S. while petitions are pending with the INS.
For example, the American Competitiveness in the Twenty-First Century Act recently increased the cap on H-1B nonimmigrant visas and calls for the elimination of the current backlog in cases and a decrease in processing times. As commendable as this piece of legislation is, the INS and DOL are still unable to keep up with the volume of petitions. Currently, Service Center processing times for H-1B approval notices can take three to four months. Contributing to the delay is the DOL's increased turnaround time of between three and six weeks for approval of H-1B Labor Condition Applications (LCAs). As a result our audit and tax practices recently had to turn away many previously scheduled foreign nationals because they would have arrived in the States to work after our tax busy season due to the exorbitant H-1B delays. Not only did these PwC foreign nationals miss a tremendous professional opportunity, but it put great stress on our ability to timely and effectively complete our financial audits. Some of these staff members chose to work in other countries with less restrictive immigration processes.
In a related matter, the American Competitiveness in the Twenty-First Century Act's portability provision allows H-1B employees transferring to another U.S. firm to start work with a new employer immediately upon filing of a petition. Under this new legislation, the employee does not have to wait for the H-1B petition to be approved before traveling for business or personal reasons outside the U.S. This legislation is encouraging to employers like PwC who often require employees to travel outside the U.S. on business. While the spirit of the legislation is helpful, the implementation is flawed. In the absence of guidance in the field, the INS has stated that for the time being, each port of entry will determine the admissibility of an applicant for H-1B status which means that an approved petition may, in fact, be necessary to return to the U.S. from a visit abroad. As a precaution, PwC is currently advising new H-1B employees to remain in the U.S. until their petition is approved, which again, could take three to four months. This is incompatible with the realities of the global market in which we compete.
Unfortunately, inordinate delays like this have become the norm and the timing couldn't be worse. In today's global economy, the need for specialized knowledge and expertise that can be deployed anywhere, anytime has never been greater. Accordingly, PricewaterhouseCoopers supports the implementation of Established User Programs, similar to L-1 Blanket programs, that would streamline processing and decrease turnaround times for high volume nonimmigrant visa employers with a proven track record. Implementation of such programs would reduce paperwork and free up INS and DOL resources to work on other cases. The United Kingdom has implemented such a program for its corporate clients with great success.
PwC also supports the proposed June 2001 implementation of an INS $1,000 fee to expedite processing. Due to high volume and data management issues, however, this "fast track" service will not be available for H-1B visas in the near future. Fees generated from this new program might be used to enhance INS information systems to better manage the heavy caseload and data. In the long-term the INS must invest in building its electronic filing capabilities to bring its operations into the 21st century. As a start, electronic signatures on employment-based immigration filings should be implemented as soon as possible to save time and eliminate courier and other related expenses.
The vast majority of U.S. and international executives have spouses who are working professionals. Some countries, including the U.S., maintain laws that prohibit spouses from working in the host country. The inability of a spouse to secure employment in the host country results in both a loss of dual income and career enhancement opportunities. While PwC provides visits home, cultural awareness briefings, language training, and nominal financial support – this does not make up for an involuntary career break which may mean setting aside career goals as well as relinquishing contacts, networks, and benefits.
Inability to obtain spousal work authorization is one of the main reasons our L-1 international transferees refuse, or prematurely terminate an assignment -- and this is exceedingly costly for both the company and clients. PricewaterhouseCoopers wholeheartedly endorsed the "Spousal Equity Act" introduced in the last Congress which would permit the negotiation of agreements to grant work authorization for spouses of L-1 nonimmigrant visa holders. We will work towards reintroduction and passage of similar legislation with this Congress.
The hurdles that businesses face in deploying staff also act as significant non-tariff barriers to competitiveness. Despite the World Trade Organization's inability to formally launch a broad round of negotiations in Seattle, discussions on the services negotiations have begun, and the world will continue to search for new ways to expand international trade and fuel global economic expansion. Services are at the heart of the new economy. Any effort to improve the efficiency and the dynamism of the service sector will contribute to global economic growth. Not only do certain sectors, such as telecommunications, transportation, financial, distribution, professional and information services, play a key role in a country's infrastructure, but the new manufacturing economy also benefits from innovative and efficient services crucial to production, such as product design and engineering, marketing and distribution, outsourcing, and globalization strategies.
Whatever progress that can be made in reducing trade barriers will be mitigated, however, if business isn't able to move people in a timely and efficient manner to support the sale of products and services around the globe. Until deployment procedures are expedited around the world, business will not be able to adequately support the movement of goods and services. And everyone will continue to suffer. Impaired mobility inhibits trade and investment across borders. It's also detrimental to the health of local economies -- economies that would otherwise benefit from the financial and technological resources that typically accompany employee transfers.
The demands of global trade are such that response time is critical to servicing of goods and the delivery of services. If we don't fix the problem now, it becomes that much more difficult in the future. PricewaterhouseCoopers has been working both in the U.S. and in Europe to ensure that liberalization for temporary entry of service professionals is on the agenda of trade negotiators. It is imperative that the U.S. and our trading partners make more meaningful commitments to establish a rapid deployment capability that provides for transparency, predictability, harmonization and speed in moving our business personnel around the world to service a global economy.
In conclusion, at PricewaterhouseCoopers we like to differentiate ourselves as the premier and unique professional services firm. However, when it comes to immigration, the challenges we face are in no way unique, nor are they easily remedied. My counterparts at both like-size firms and smaller organizations deal with many of the same issues I mention here today. Congress needs to make resolving these challenges a priority, otherwise we all will fall short of the promise of what a global marketplace can do to boost our economy.
Thank you again for the opportunity to present my firm's views at today's hearing. I look forward to your questions.