H-1B issues always heat up the closer we get to an election year, for e.g. Cruz once wanted to increase the H-1B cap from 65,000 to 325,000, while Rubio’s proposed “I-squared” Bill attempts to triple the number of temporary guest workers that firms can bring in every year. The US Congress in recent months has been considering Bills that seek to triple the cap of H-1B visas to 195,000. There is, however, a growing discontent about the H-1B visa process among skilled workers in the US, who say the visas are a way for big companies to hire cheaper foreign workers.
Over the last few weeks there has been a lot in the media about Disney and power utility Southern California Edison where they apparently hired Indian firms TCS and Infosys to replace in-house tech workers with Indians on H-1B visas.
Indian IT companies have long been accused of using loopholes in immigration regulation in order to make a quick buck, thanks primarily to the ability to pay their imported workers on H-1B visas between 30 percent and 50 percent less than the prevailing American wage rate for that job.
In 2014, out the top 10 companies in the H1B race – six were Indian (with Infosys leading the table by a huge margin, at 32,379, versus second-place TCS, at 8,785), the rest were all American. Incidentally, both the companies are being investigated. Deloitte, IBM, Accenture, and Microsoft made up the remainder of the top 10, while Ernst & Young and Google sneaked into 11th and 12th places.
According to a study done by Norman Matloff, a professor of computer science at the University of California at Davis “has shown that non-Indian companies use the visas to acquire cheap labor, saving about 20 percent in an apples-to-apples comparison — ie, young foreign workers versus young Americans — and as much as 50 percent for hiring young H-1B visa holders instead of older Americans.
It turns out that Ian Hathaway, research director at Engine, an American economic research outfit, has churned out numbers that show employers find it a whole lot more difficult to find candidates in the science, technology, engineering, and mathematics (STEM) fields, as well as computer and math sciences (CMS), than those in other fields. Apparently, at the end of 2012, there were 2.4 CMS job openings for each unemployed CMS worker, and 1.4 STEM openings for each unemployed STEM worker, versus four unemployed workers per job opening in non-STEM and CMS fields.
What’s more, Hathaway showed that wage growth for STEM and CMS workers with at least a bachelor’s degree was far more “robust” in the last 12 years, compared to other fields.
“Not only did wages grow at the median for these fields while wages in all other professions fell substantially; that growth also reached workers with a broader set of income levels,” Hathaway pointed out. In fact, it is “irresponsible for researchers to claim there is an oversupply of STEM workers”, he added.
If this isn’t conclusive enough, The New York Times pointed to another study conducted by William R Kerr, a Harvard business professor, who found little empirical evidence amongst 300 American companies that pointed to American engineers being displaced by foreign ones. In fact, Kerr’s study suggested exactly the opposite — that the growth of immigrant workers “helps younger American technical workers; more of them are hired and at higher-paying jobs — but has no noticeable consequences, good or bad, on older workers”. Kerr also said that “in the short run, we don’t find really any adverse or super-positive effect on the employment of Americans”, adding that “people take an extremely one-sided view of this stuff and dismiss any evidence to the contrary”.
And yet another study conducted by academics at the University of California at Berkeley found that over the span of a decade in an urban area, a 1 percentage (of total employment) increase in foreign STEM workers during a decade actually increased the wages of native-born American college graduates by 4 percent to 6 percent, with small effect on their employment.
America is the world’s largest engine of innovation. Legions of its tech workers have and continue to pioneer new ways in which technology can improve our quality of existence. It seems to me that in the absence of any concrete evidence that H-1Bs threaten the existence of the American techie, it may be more productive to focus on how to move up the value chain.
Given that it is mostly engineers doing the interviewing at our IT companies, we must face the reality that ethnic hiring bias is what is making if “more” difficult to find “qualified” engineers.
And this will only get worse without significant diversity requirement in H-1b visa hiring. Clearly, with 70% of the H-1b visas going to people from India we are seeing the worst, of the worst, case when it comes to ethnic bias in hiring.
Remember it only takes one bigotted engineer (intent on hiring their cronies) to cause the entire candidate-seeking process to collapse. Hence the advantage of being referred by one of your friends and cronies when seeking to bypass that HR collapse (blame the Lazlo Block types for that collapse).
And the reality is, 90% of the problems that companies are having finding engineers is really part of a bigger problem of ethnic bias in the hiring process. With Google and Microsoft publicly reporting that they throw away 99.9% of the engineering resumes they recieve, how can we be such idiots and miss this obvious condition and the fact that biased hiring is the 1st order magnitude reason for the mythological engineer shortage.
In U.S. Public court documents, an InfoSys Senior Vice President is quoted as telling a recruiter to only consider the resumes of people from India for jobs on U.S. soil. After the recruiter had shown the VP and a hiring manager the resumes of several qualified U.S. candidates. Clearly, at some companies operating in the United States, the discrimination factor introduced by the H-1b program is so bad, that discrimination is now a Company-Wide-Policy.
At my company, in the heart of Silicon Valley, this year we have hired 20 new grads. That’s a 20% increase in our local engineering workforce.
And reason for this is simple, we have an ethnically diverse workforce. And that workforce has a wide range of ages and original dates of employment. Meaning our workforce is still a huge source of new referrals.
This is the problem at most Tech and IT companies. The Rooney rule should be standard for all companies that intend to use a government handout (in this case excessive dependence on the H-1b visa).
Some companies, notable InfoSys, Tata and all the other Offshore Outsourcing companies are completely dependent on it. And clearly the publicly exposed racial and ethnic, company-wide, discrimination programs are just clear signs of a sick and degrading condition of government dependence at these companies.
And the CEO of InfoSys has the nerve to say publically that they are finding it difficult to find local U.S. candidates.
Enough of the Zero-IQ whining!
The author should at least try to be impartial (tries to make it seem so by a couple of comments from Prof. matloff). For every opinion about the pros of H-1B, there are many systematic studies that show the H-1B system has destroyed the American work force. What the author does not realize it is not just about the job; American families have sacrificed their lives over generations and they HAVE to be given first and second preference for any job. What right does Gates and Zuckerberg have to claim that H-1Bs are more important? They became zillionaires because of sacrifices of millions of Americans – let them not forget!
Google Kevin Flanagan and talk to his family about value chains.
Someone needs to talk to the displaced folks from Pfizer, American Express, Motorola, Verizon, Warner Brothers, Bank of America (should I go on?)
Anyone who is in favor of H1-B is an enemy of the United States.
That “perception” is a majority opinion over here. . .
Yeah, few years back any one not in favour of Iraq Invasion was enemy of the state! I get it.
Lack of evidence? Where is this idiot looking?
We have plenty of evidence: every American tech company filled to the ceiling with conmen H-1Bs from India who were supposed to be TEMPORARY WORKERS and go home after Y2K but who are now occupying every IT job in American while 93 million Americans are out of work. Evidence like that.
Even top tech grads from some of the nation’s finest schools can’t even get their job applications responded/acknowledged by firms claiming ‘shortages’ of domestic talent. That should tell you pretty much everything you need to know. Many people who went into engineering, IT, and the sciences were bullied in school — trying to enter the workforce is even more difficult and depressing when the bullies are in charge and are doing everything in their power to exclude American tech talent.
Another perception.
For 15 years, the American tech worker, all across America, has welcomed the foreign H1B workers with open arms, hospitably helping him time and again in countless ways.
And what thanks has the American worker gotten? A stabbing in the back by the hordes of foreign H1B workers, relentlessly flooding our own labor markets.
It think the tide has changed in one sense. While the deluge of new H1B visa holders has not slackened, they are no longer welcomed by the American tech workers, who now see them for what they are, a vector of harm to our salaries, careers and families.
Unprecedented immigration under the H1B Visa Program has destroyed the American engineering profession.
It’s Economics 101: The Law of Supply and Demand.
CONSIDER AN ANALOGY
Consider an analogy. Consider, for example, what would happen if H1B were applied to plumbers instead of engineers.
Pick any city, let’s say, Anytown, USA. Now, bring in 100 busloads of freshly graduated Indian or Chinese plumbers (4,000 new plumbers), who want to enter into the plumbing business in Anytown, USA, and make a living.
The result? Wage rates for plumbers will become depressed.
The existing 960 American plumbers in Anytown, USA, once busy every day, and making a good living, will now have much less work, or no work at all.
All the Anytown, USA high school kids hear from their fathers and uncles that plumbing is no longer a good way to make a living. The plumber wages are going down, down, down. In droves, they choose some other path in life. Who can compete with impoverished hordes of plumbers from India who will work for any price? India has 1.17 BILLION people, and many of them are coming here, flooding our labor markets.
The H1B visa law was created, written and lobbied for by large American corporations as a means for decreasing their engineering labor costs. Indeed their corporate profits have zoomed up, up, up — while the wage rates paid to their American engineers have gone slowly down, down, down.