The U.S. Citizenship and Immigration Services said Thursday it received 172,500 petitions from companies seeking to hire skilled foreign nationals for the next fiscal year under the country’s H-1B visa program. This more than exceeds the 85,000 available visas, so for the thousands of companies that didn’t get their paperwork in on time: better luck next year.
This annual scramble for tens of thousands of skilled foreign nationals to work in the U.S. for as long as six years has become one of major issues in the current national debate over U.S. immigration reform. Major tech-industry players like Microsoft Corporation (Nasdaq:MSFT), Hewlett-Packard Company (NYSE:HP), Apple Inc. (Nasdaq:AAPL) and Facebook Inc (Nasdaq:FB) claim the country is not producing enough computer programmers, hardware engineers and other technology related professionals.
This skills gap is disputed by some labor economists, who point to stagnant wage growth in recent years of tech industry jobs, rules that allow employers to pay foreign temps well below median wages, and the competitive advantage companies have using workers who have far less mobility in the U.S. jobs market. If they're fired or laid off, they must buy a plane ticket, pack-up, and leave the country within days -- a strong incentive to work extra hours.
“The employer has more bargaining power [vis-à-vis the H-1B guest worker],” said Ron Hira, associate professor of public policy at Rochester Institute of Technology and co-author of “Outsourcing America,” about the economic impact of shipping U.S. jobs overseas. “If you aren’t able to quit your job and go try to find something else and your boss tells you to work until 10 o’clock at night, what are you going to do? If you get laid off you have to leave the country because the work permit is in the hands of the employer not in the hands of the worker.”
These employees, many recruited from India, are also allowed to be paid entry-level wage rates regardless of skills or experience. This wage-suppression effect can cut off bottom-rung positions available to locals who entered the workforce more recently. Jobs that would go to recent local graduates in the U.S. are sometimes filled by more experienced expatriates happy to take lower pay because it would be more than what they would earn back home.
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Data from the U.S. Department of Labor shows that five companies devoted to recruiting foreign temps submitted requests for at least 51 percent of all H-1B visa programs in 2013.
According to a 2011 report from the U.S. General Accounting Office, 52 percent of all requests for H-1B workers were recorded by employers as entry-level positions. Hira, who has studied the H-1B program for years, says he’s never seen an instance where the Department of Labor has audited employers’ claims that the position actually pays a salary commensurate with the experience and skills of guest-workers they want to hire.