H-1B Visa Program’s Effect on the Foreign Technology Workers in the US

The NY TimesRoom for Debate Blog has been discussing the issue of ‘does the US need foreign technology workers?‘ The conversation is an interesting one because it seems that all of the participants view the H-1B worker visa program as a significant problem to the future success of the US. The underlying argument of the conversation is that the current immigration policies of the US (specifically the H-1B program) promoting growth of the US economy or are they making it easier for employers to move more jobs to low-cost countries?

I find this discussion to be an extremely important one as it has an immediate effect on the US job market for international student graduates but also because if the US becomes viewed less and less by prospective international students as ‘a land of some opportunity’ rather than ‘the land of opportunity’ we may see students flocking to other premier education destinations such as the UK, Canada, Australia, Western Europe over the United States.

The participants in the conversation included:

Vivek Wadhwa, an executive in residence for the Pratt School of Engineering at Duke University and a senior research associate in the labor and work-life program at Harvard Law School.

Norman Matloff, professor of computer science at the University of California, Davis.

Guillermina Jasso, professor of sociology at New York University, research fellow at IZA Bonn and a principal investigator on the New Immigrant Survey.

Ron Hira, assistant professor of public policy at Rochester Institute of Technology and co-author of “Outsourcing America.”

Mark Heesen, president of the National Venture Capital Association.

John Miano, lawyer and computer programmer

Nearly all the participants in the conversation allude to the fact that the H-1B visa program is flawed in one way or another.

In one camp we have a group that sees the issue with the H-1B visa program as not truly finding the ‘best and the brightest’ talent from around the globe. US companies are using the H-1B visa program as a way for companies to exploit cheap foreign labor rather than having to hire ‘expensive’ American labor.

Norman Matloff writes that ‘The world’s “best and brightest” should be welcomed, but most H-1B workers are not in that league. Meanwhile many of our own best and brightest are squeezed out of the market once they become expensive.’

Ron Hira says that ‘Loopholes enable employers to hire H-1B workers at below market wages and bypass American workers, never even entertaining their applications for a position. In fact, some firms replace American workers and their contractors with guest workers on H-1B and other visas, at times even having their American workers train their foreign replacements.’ Ron goes on to explain that after a recent audit by the Department of Homeland Security, ‘more than one in five H-1B visas were granted under false pretenses, either outright fraud or serious technical violations.’

John Miano explains ‘when the annual quotas on H-1B visas are exhausted, one often hears lobbyists arguing that the world’s best and brightest are being shut out’ but in reality ‘the people who seek H1-B visas and may be barred by the quotas are not extrememly highly skilled workers.’ He sums up the H-1B visa program as ‘a cheap labor program being marketed as a program for the highly skilled.’

In another camp the argument is that the enitre visa program from student to H-1B to permanent resident status is causing foreign born workers to live as second class citizens resulting in an exodus of highly skilled talent.

The argument by Vivek Wadhwa is that a major portion of technology start-up success has been derived from foreign born workers, $52 billion worth in 2005. But even though we are increasing the number of H-1B visas every year we are failing to increase the number of permanent residency visas resulting in 500,000 foreign born workers stuck in what he calls ‘immigration limbo’. If these workers have to live as second class citizens while awaiting a permanent residency visa most will decide to leave for their home countries where they may make less money but experience a higher quality of life. Mark Hessen takes a completely different approach to the issue and looks at it from a start-up company standpoint. He believes that foreign born workers by their immigrant status alone tend to be risk takers and because many have scientific backgrounds with a focus and ability to invent breakthrough products and services. The problem however that he sees is that by having a quota of only 65,000 H-1B visas per year, US start-up companies are being deprived of the quality talent they need to grow. Ultimately he says that ‘to maintain our competitive edge, we have to remain a magnent for global talent. Shutting our borders to these entrepreneurs is counterproductive. The more of them we can attract, the more jobs for everyone.’

Listening to all sides of the issue on immigrant workers in the US tech space I can understand the obstacles that the US faces ahead. I am a huge advocate for international students to remain in the US after they graduate to participate in the US economy and workforce. It seems to me that there are major issues with the H-1B visa program but ultimately what needs to happen for the US to stay competitive is to find and embrace the highest quality foreign talent (much of which is already studying in US colleges and universities) and allow them to cultivate their skills which as seen in the past can create an incredible amount of jobs and prosperity for American workers. Unfortunately we will have to deal with the fact that corporations will worry about their bottom lines more than the future success of the US and therefore until proper oversight can be administered to the H-1B visa process smaller start-ups need to fight to get H1-B visas for the talent necessary to make their companies succeed.

Hopefully we can solve this issue with a positive result as the future of a country completely compsed of immigrants is at stake.

Photo by Mark Kobayashi-Hillary


4 responses to “H-1B Visa Program’s Effect on the Foreign Technology Workers in the US

  1. Navin Johnson

    A simple solution is to say that any worker coming in on an H1B has to have a minimum salary, say $65k. Under that, no permit. It works in Europe and is very simple to administer. Let the current H1Bs reapply, and if they don’t stack up, out they go. (My friends from outside the US, who would be making $100K+ can’t get in because of all the H1Bs going to those making half that or less, in fact, but who can play the system. That means less tax money and less talent for us.) The European Blue Card is dead, and the American Green Card is far more attractive. So, we shouldn’t sell ourselves short. We should also look at ways for Americans to work abroad and develop some skills that we now import.

  2. Rossana Weitekamp and Barbara Pruitt of the Kauffman Foundation co-authored an article titled “U.S. stands to lose high-skilled immigrant entrepreneurs and science, engineering workforce”. Kauffman Foundation survey shows an obvious need for creating better ways of keeping the best and brightest foreign students in the US talent pool by giving them permanent residency, rather than limiting them with H1-Bs.

    Check it out:

  3. Guys, this is a great post, well balanced in terms of opinions.

    A couple of things
    1. I do not agree with most H1 B workers are underpaid cheap labors and that’s the only reason big enterprises want to expand H1 B program. To prevent this, the employers are mandated to pay at least the prevailing wage for the position they are hiring. So unless they are they are hiring the software programmers in the positions of office cleaners but really ask them to write code in the broom closet, I really doubt they can get those H1 B applications past the Labor Condition Application (LCA) process.

    2. Visas for foreigners to start companies.

    I didn’t see this topic in the post but I consider it quite relevant to changing the landscape of entrepreneurship in high tech industry. Paul Graham just coined it ‘Founder Visa’. http://www.paulgraham.com/foundervisa.html

    Let the foreigners start their own ventures, make it legally possible for scrappy engineers who want to take risks of starting their own companies. The only options that are remotely related are B1 visa (3 month period) or EB 5 visa (that requires $1M investment).

    Recently, there was a study done by Duke University regarding immigrant entrepreneurs.
    Quote from the article
    “more than half of the immigrant founders, 55%, came to the U.S. as students and stayed on.”
    So yes, you are absolutely right about supporting the international students who wish to stay and contribute to this economy.

  4. Hi Moah,

    Thanks for the thoughtful response.

    I do think Washington is shooting itself in the foot by not exploring the ‘Founder Visas’ more aggressively.

    There are a lot of numbers being thrown around that seem to support the need for a serious discussion on visa reform. Is there any formalized study that makes a stronger argument to push this forward?

    Another related article from Venture Beat :

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