EA CEO Calls for Immigration Change

Electronic Arts
Earlier this month, Gaming Bus reported on how broad the tax incentives are for the video game industry. We also talked about how EA continues to push for increased incentives. EA is a best known for publishing the Madden and Sims series of games.

Last week, EA CEO John Riccitiello spoke at the U.S. Chamber of Commerce in Washington. Many subjects were covered in his speech: Disruption, Turnaround, and Job Creation.
 
 
Even though the Disruption and Turnaround talking points were not too surprising, the Job Creation segment took an interesting turn into Immigration and how it effects not only EA’s need to fill job positions, but those of other businesses in the country as well. EA CEO John Riccitiello said the following:

“Cost is a big consideration in where we locate but increasingly, the pinch point is technical talent. At EA, we employ nearly 6000 people who are directly involved in creating our games – 3,508 are engineers. Yes – 3,508 engineers. It’s not enough. We need a lot more. Trust me when I tell you, we offer high wages and great benefits. But we still have trouble recruiting the technical people we need to make games in the United States.”

What is not clear is how many are employed here in the United States or abroad. He also said:

“Vivek Wadhwa – an academic and Washington Post columnist – estimates that 60 percent of Engineering Ph.D.s and 40 percent of the Masters graduates educated in this country – leave this country to work somewhere else – in many cases, China and India. I love the simplicity of Congressman Jeff Flake’s STAPLE Act. When a foreign student earns a graduate degree in engineering from an American university, we should staple a green card to the back of that diploma. I’m told that both Democrats and Republicans support this idea – but that it’s being held as a bargaining chip over other provisions in the immigration debate.”

This would obviously open up new opportunities to these graduates, help bolster the economy but further along in his speech his words echoed back to the tax break article. He went on say this:

“I don’t believe America has to provide dollar-for-dollar subsidies with job markets like Romania, India and China. But companies are rational actors and tax and regulatory issues weigh heavy in our decision process – it’s impractical to think patriotism is going to counter that. So let’s resist the demagoguery about off-shoring jobs and paying taxes in foreign countries. Having American companies win overseas is fundamentally good for America.”

A full transcript can be found at Financial Tech Spotlight.


Analysis: This is something I can somewhat agree on, but the devil is in the details. Where I agree with is that this should help encourage those who get their education here to stay here and be picked up by these companies. Where I don’t agree is that he’s holding the tax revenues over their heads as a reason why game studios stay in the U.S. Now, I’m not to going to say this is his intent, but it’s a point that I see he’s making in that statement. I realize that tax breaks are what companies look at, but that statement just seems a little to blatant, especially with the previous article on the game industry taxes earlier this month.

I think the STAPLE act is going to benefit the U.S. jobs market and economy because companies know they don’t have to wait or offer positions in other countries with less restrictive immigration laws. The only problem I see is that it’s being used as a political bargaining chip on other bills and not one that is being presented as a independent bill. The unemployment rate in the U.S. rose in a majority of states, which means it will take a long time before anything is done to put it into law.

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About Brandon Mietzner