H-2B crisis: Summer businesses brace for big foreign worker shortage

Donna Tunney

On any typical summer night at Arnold’s, the popular seafood restaurant on Route 6 in Eastham, a crowd of hungry, sunburned vacationers lines up outside, waiting for tables. Inside, the aromas of fried clams, steamed lobsters and corn on the cob give the place a decidedly Cape Cod atmosphere.

Come the tourist season this year, however, customers might have to wait longer to get in the door.

“I don't know what we'll do. Services will certainly suffer, at the least,” said Arnold’s owner Nick Nickerson, who is among scores of Cape business owners trying to cope with what is expected to be a critical lack of foreign workers in 2008.

A perfect storm

Between 5,000 and 7,000 foreign workers typically arrive on the Cape each spring, filling waitstaff, housekeeping, landscaping and many other jobs.

Two big problems related to the H-2B foreign worker visa program have combined in recent months to create a kind of worker-shortage perfect storm.

The first is that the U.S. Citizenship and Immigration Services said last week it had reached its congressionally mandated H-2B visa cap and has stopped processing new petitions for foreign workers. In past years, petitions were typically still being processed well into March. The national, annual cap is 66,000 – 33,000 each for the first and second halfs of the fiscal year. The cap for the second half of the year affects Cape Cod because it applies to workers whose employment start dates are prior to Oct. 1.

Most seasonal start dates here are in late spring or early summer.

The second is that an amendment to the visa program that would exempt returning foreign workers from the cap is stalled in Congress, mired in the immigration reform debate that involves powerful politicians and lobbyists. The exemption would enable people who worked in the U.S. last year to return this year and not be counted toward the cap. This segment of workers makes up the lion’s share of the Cape’s seasonal employee pool.

Playing politics

Jane Bishop runs Peak Season Work Force, a firm that specializes in processing foreign worker petitions from area businesses.

“The Hispanic Caucus is holding the returning worker amendment hostage,” she said, “because they want complete immigration reform, which to me translates to amnesty for illegals. And they have [House Speaker] Nancy Pelosi on their side.”

Bishop’s firm is based in West Dennis and typically arranges for upward of 500 foreign workers to come to Cape Cod each summer.

“The vast majority of members of Congress support the amendment. Out of 435 members, I believe just 34 are blocking it,” Bishop said, “and Pelosi won’t put it forward for a vote.”

Mark Forest, an aide to U.S. Rep. William Delahunt, Democrat of Massachusetts, said that when Congress reconvenes later this month, Delahunt would continue to push for the returning foreign worker exemption amendment.

However, he added, “As long as immigration is a radioactive issue in Washington, some people will have to think of other options.”

He said Delahunt’s office was “very busy in November and December helping [businesses] with their [foreign worker] applications.”

But Bishop said she believes that those applications, like all the others, were not processed before the cap was reached.

“There’s a process every application follows. Before it even gets to Immigration, it has to be processed through the U.S. Labor Department, and none of those applications made it to Immigration before the cap was reached,” she said, adding, “To my knowledge, no business on the Cape and Islands was able to get in under the cap.”

Trying to cope

For many Cape Cod businesses, this political hot potato is translating into a giant headache.

Nickerson hires 55 seasonal workers for Arnold’s each summer, and 10 of them are foreign workers. “The H-2Bs that I had are really important to my business. They cannot be replaced. They allowed me to stay open later in the season, into October. I'm not so sure that's going to happen this year,” he said.

In Provincetown, a survey of all licensed businesses is estimating that 500 full- and part-time positions will go unfilled. Michelle Jarusiewicz, the town’s grant administrator who is compiling the survey data, called the political aspects of immigration “a thorny issue.”

The Cape tip destination has added challenges, Jarusiewicz noted. While some other Cape Cod communities might be able to pull in labor from off-Cape, Provincetown is too far and remote to attract those workers. It is also more expensive than other communities, making it less attractive to prospective workers because of the cost of housing, she said.

Like Provincetown, Harwich Chamber of Commerce is taking steps to evaluate how its seasonal businesses will be affected. Executive director Sandra Davidson last week launched a member survey, and predicted that Stop & Shop, Shaw’s and the Wequassett Inn would be seriously impacted.

“For those businesses that typically employ a lot of foreign workers, it’s going to be a real challenge,” she said.

Finding new workers

Forest, Davidson and Bishop suggested that businesses explore recruiting foreign student workers under the J-1 visa, which has no cap.

Under a “work/travel” exchange program, it enables certain foreign students to work in the U.S. for up to four months but sets strict requirements. For example, according to the Immigration Service Web site, such visitors must “have sufficient funds to cover all expenses, or funds must be provided by the sponsoring organization in the form of a scholarship or other stipend.”

Still, the J-1 visa holders would be a viable option for some employers here. The Council for International Education Exchange administers the visa. Its Web site at has information for both employers and students.

The Harwich chamber’s Davidson said some employers in the area are planning to visit ski resorts this winter, hoping to recruit workers from the resort areas when the ski season ends.

Besides foreign workers, said Davidson, Harwich and other area businesses tend to rely on local students, but most high school and college students typically must return to school before the season ends.

“Here we are, all trying to extend our season into September and October, and our student workers go back to school in August,” she noted.

Another largely untapped market of potential workers is the young retiree/mature worker population around the Lower Cape, said Davidson.

“Demographically, that population segment is a real strength for this area. There may be many more opportunities this year for the mature worker to help make up [the loss in foreign workers],” she said.

Bishop agreed that the senior population segment has potential, but predicted that few retirees would be interested in waiting tables or scooping ice cream. The answer, she said, lies with Congress and the approval of the returning worker amendment.

“People need to understand this is not an immigration issue, it’s an economic issue. The returning foreign workers are here legally. They pay Social Security, they pay federal and state withholding taxes, the employers pay unemployment insurance. All this comes out of the economy – it comes out of the revenue stream. Then there’s the room tax revenues, which could fall if small hotels and inns have to shutter some rooms because they don’t have staff to clean them … the list goes on,” she said.

If there’s a silver lining in the foreign worker debacle, Bishop said, it’s that “this happened in January, and maybe there’s still time to fix it before the spring season begins.”

“What the fix will be, I’m not sure,” she said.

Arnold’s Nickerson, meanwhile, said he’s still hoping Congress will pass the amendment, but he isn’t optimistic.

“We’ll just have to manage. It will be more difficult,” he said.

John Basile, Steve Desroches and Marilyn Miller contributed to this article.

The Cape Codder