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The purpose of H1B Visas is to supply talent that CANNOT be found domestically. They are not designed to suppress the wages of locals at the benefit to the owne
by adrenalinelol 10y ago
The purpose of H1B Visas is to supply talent that CANNOT be found domestically. They are not designed to suppress the wages of locals at the benefit to the owners of capital. This is no different than a company whining about a tax-loop hole being closed and throwing around rhetoric like: "it'll come at the cost jobs and innovation!" The IT workers cited from the article in question are not uniquely skilled over their american counter-parts, they are simply being used by corporations to lower wages.
- x1798DE 10y agoYou are saying that the additional price for local talent has to be infinite? Because otherwise I don't totally understand this position. You could almost always find local talent, at prohibitively high costs. Pay enough and people will retrain, too. This sort of thing is dynamic, and what doesn't exist at one price point does at another. Of course, I also don't think forcing higher costs on everyone in the name of favoring certain groups of people over others is a particularly laudable goal.
- evgen 10y agoThis is called supply and demand. The most flagrant abusers of the H1-B system use it to artificially increase supply of workers to depress costs. If the costs rise to the point where retraining is considered an appealing option I don't see how that is a problem.
- icebraining 10y agoI'd say the supply of workers is artificially being kept low; there's nothing "natural" about immigration restrictions. Of course, I also don't agree with the use of "artificial" as a synonym for bad (or good).
- rayiner 10y agoSure it's natural. Just about the first thing any social mammals do is figure out how to control group membership and access to shared resources.
- icebraining 10y agoIn the abstract, sure, but the whole edifice of legislation of citizenship, visas, etc is as artificial as it gets.
- rayiner 10y agoThat's like saying that eating is artificial because we do it at Chipotle. The mechanism is highly artificial, but the basic function is natural.
- yummyfajitas 10y agoAnother thing which is natural is killing the men of the outgroup (typically defined as "those folks who look different than us"), raping their women and stealing their resources.
- rayiner 10y agoWhich would be a relevant point if we were discussing whether it's "good" because it's "natural." But here the point is simply that it's "not artificial" because its "natural."
- davidivadavid 10y agoThat point sounds like a tautology.
- evgen 10y agoActually, since control of one's borders is one of the core principles in the definition of sovereignty, it seems that immigration restrictions are quite natural to how we have organized our societies. Like it or not, we define our societies and nations around very simple us/them constructs and eliminating the desires of the bulk of the population to control what portion of "them" gets to become "us" is not going to change any time soon.
- deleted 10y ago[deleted]
- Avshalom 10y agoWe can restrict H1-B visas and increase other visas or make the citizenship path shorter/easier.
- riskable 10y ago> Of course, I also don't think forcing higher costs on everyone in the name of favoring certain groups of people over others is a particularly laudable goal. Isn't that the point of sovereignty though? To favor the locals over foreigners? It's why we have governments and borders. It's ethical too: Because the locals are your (long-term) tax base. It's better to pay locals a higher wage than to import temporary cheap labor in most situations because the gains from the cheap labor wouldn't necessarily make their way (i.e. "trickle down") back to the locality. Especially not in a global economy and especially not with virtual goods like software and IT services.
- freshflowers 10y agoAs a European who regularly hires people from outside the EU (including Americans), it always seemed to me that the American H1B Visas were deliberately designed to suppress wages. Any other skilled migrant visa system I know of has a very explicit and fairly high wage minimum to prevent such abuse. As a result, the stereotypical underpaid Indian engineer is a rarity in Europe. Indian engineers that do end up here are usually amongst the higher skilled and better paid workers. Hell, it's even common for skilled migrants from outside the EU to get a higher starting salary than their local counterparts (especially those from poorer EU countries) just to meet the wage threshold.
- doozy 10y agoAnd what country is this? Because I've been approached by European (German and Dutch) companies and the compensation was way below my expectations. If I'm not mistaken the minimum required in those countries to get a visa is only about €45k/€50k a year.
- inflagranti 10y agoWhich is the median salary in those regions. While an argument can be made it should at least be in the 75% or something, this definitely doesn't disprove the original statement that at least it won't suppress wages (to something like Indian or eastern European levels). Edit: I guess I might misunderstand the word suppress actually. If it means keep wages constant then I guess expanding the worker pool at the median salary level would probably do that, and the effect of not having any restriction would depress them!?
- adrianratnapala 10y agoI don't know what you call abuse but I see the this sort of thing here in Germany. In one of the teams I have dealings with, there are two non-EU developers who get unusually low wages (I don't know the exactly what). They both put up with it because the german residency permit is valuable to them. There might well be a salary limit, but it's obviously not very high, at least not by the standards of engineers. These guys are getting decent salaries by the standards of oridnary working Germans. I suspect it is a similar story for H1B in Aemrica.
- BurningFrog 10y agoAdding to the supply will always lower prices. That is basic Economics. If the program is "designed" to do that or not doesn't matter. > they are simply being used by corporations to lower wages That's bit conspiratorial. I think of it more as they need more engineers to get more work done. This lowers the wages of the native engineer population, but raises them for the imported workers. The net result is a bigger population of highly productive high income earners, that is quite good for the overall American economy.
- wcummings 10y ago>That's bit conspiratorial. No, believing otherwise is naive. Zuckerberg isn't lobbying for more H1Bs out of the goodness of his heart and a profound belief that labor arbitrage will make the world a better place. Labor is Silicon Valley's biggest expense, you had better bet they're trying to reduce that cost. If we're going to allow foreign workers, they shouldn't be shackled to employers like H1B workers are.
- BurningFrog 10y ago> No, believing otherwise is naive. Zuckerberg isn't lobbying for more H1Bs out of the goodness of his heart and a profound belief that labor arbitrage will make the world a better place That's a silly caricature of what I said. > If we're going to allow foreign workers, they shouldn't be shackled to employers like H1B workers are. Agreed.
- nullcipher 10y agoThe H1B workers are still less shackled than those L1s. If that makes any H1Bs feel better.
- pps43 10y ago> I think of it more as they need more engineers to get more work done. They can easily get more engineers by simply increasing salaries. Let's say I'm a bright student deciding whether to study software engineering or plumbing. When I graduate, my salary will be driven by supply and demand. As a software engineer, I will be competing for jobs with other software engineers, many on H1B visas coming from countries where education is less expensive than in the US. So those software engineers can comfortably accept a lower salary. No such problem with plumbing, so it is rational for me to chose plumbing. Now Zuckerberg and co can justifiably say "look, there is a shortage of software engineers, let's lift H1B cap".
- mc32 10y agoIf you want to keep it so that locally grown talent isn't undercut in price, tax foreign labor do that the effective price of foreign labor is on par with domestic labor. So if the median salary for skill X in locale Y is 150 and foreign labor is willing to accept 120, apply a 30 tax to the company to neutralize any difference, someone accepting 100 the company pays the 50 difference, etc.
- deleted 10y ago[deleted]
- protomyth 10y agoI wonder about a variation of this for companies that would reduce the taxable revenue of companies by the amount spent on salary + benefits of citizens, but not by H1B.
- splintercell 10y ago> So if the median salary for skill X in locale Y is 150 and foreign labor is willing to accept 120, apply a 30 tax to neutralize any difference. I wish that every single individual who on this site rants against H1B, understood one thing about H1B (or any law in general): The intent of a policy isn't always the real usage of a policy. Or in more general, the art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups. I can clearly see how you approach this problem. You see these economics and incentive problems as some sort of equation, where you notice that foreign labor undercuts local labor in terms of wages. So your solution is: "Lets make it expensive for companies to hire foreign labor", but that's incredibly naive. The elements of the equation you're missing is: * H1B is a path to immigration, not just some mechanism (as stated by the policy) to acquire labor. The stated reason is how it might have been sold to the American people, but at the end of the day, it's how high skilled immigrants come to America. * The foreign labor is much larger, and (economically) diverse than you think. If you put a 30 tax on a foreign labor who is willing to accept 120, then some other foreign labor who is willing to take 110 would find himself in demand. * H1B regulations make it difficult for the foreign labor to easily change jobs, this results in them being more 'loyal' (that is, they work for a company for longer than their local counterparts), which means it's worth investing the training time on foreign labor (which means they would hire a 100K foreign labor for a job which needs a 150K local talent, pay 30K and train him). * The reason why local talent can't be paid what they are asking for, is because not every product has the same 'gross profit margin'. People are willing to pay $600 for a smartphone which can be produced for $300(gross profit margin 100%), but they are not willing to pay $300 for a smart watch which is being produced for $150. However smartwatches could be sold if they were available for $250(that is if they carried a gross profit margin of 60%). Lower profit margin means that the local talent who demands $150K may not be available for hire.
- jobu 10y ago> The purpose of H1B Visas is to supply talent that CANNOT be found domestically. They are not designed to suppress the wages of locals... If this is really the intention, then changing the format to an auction (based on salary) instead of a lottery would help.
- riskable 10y agoThe problem with auctions is that employers in areas with high cost of living would get away with bargains while everyone else would get nothing or very expensive employees. This would result in some perverse market incentives and unintended consequences. Not so dissimilar to the unintended effects that the H1B visa created in the first place.
- bandrami 10y agoWin win. That means states couldn't do a race to the bottom of wages to poach tech companies. Sounds good to me.
- vostok 10y agoAs an employee with unique skills, I have found that my pay does not depend on cost of living.
- jobu 10y agoAs someone that's lived (and hired people) in both low-cost and high-cost areas, the pay doesn't scale the same as the costs. There are tradeoffs for those areas that go beyond the costs. Usually people think of climate or culture but there were a couple other non-obvious ones that I ran into: 1) Companies that are doing well and growing in a low-cost area tend to suck up all of the available talent in that area, and they need to relocate or increase salaries to incentivize people to move there. 2) Low-cost areas generally have fewer jobs for highly educated and highly skilled people, so as an employee I'm taking a huge risk by moving there. If the job doesn't pan out or the company takes a dive, then I may need to move to a different area to find another job in my field.
- huherto 10y agoIt should bring talent and diversity. Bringing ideas from multiple cultures and occupations, to establish connections and interchange with those. Right now many H1B are used by Indian IT companies. Also, they are the most abused on the green card process since they have to wait years because of the huge backlog. Edit: Seems like my argument is being misunderstood. The HB1 program should bring talent from many different countries not only India. It should bring different talent for different occupations not only IT.
- riskable 10y agoThe diversity argument falls flat when you replace your entire IT workforce with H1Bs from the same country (India). This holds true when companies replace entire divisions or departments with outsourced H1B labor as well.
- huherto 10y agoThis is the argument. Currently H1B are not bringing diversity. They should.
- droopyEyelids 10y agoIt's dastardly to use "diversity" as a smoke screen when you're talking about hiring someone for less money than an equivalent citizen salary.
- deleted 10y ago[deleted]
- geebee 10y agoI agree with your edit. This is my big problem with the H1B visa. But how is what you are describing different from general immigration then? The US takes in approximately 1.2 million immigrants a year, and these immigrants are (by and large) free to pursue a career path in response to their personal interests and market signals. If they like flexibility, career stability, and helping people, they might choose to become a dental hygienist (paid at the median almost as well as a software developer in San Francisco). They might go to med school, sell real estate, open a sandwich shop, or try to make a go of it as an artist. If they like coding but don't want to work in a large open office with back visibility, micromanagement through scrum, age out at 35, and spend most of their time debugging javascript to get the drop down menus on the corporate payroll site to display properly, well, then they may decide to code as a hobby and do something else, or demand a lot more money, at least. My problem with the H1B is that it allows employers to coerce employees into these jobs, under the notion that there is a shortage. Well, maybe there's a "shortage" because these are unpleasant jobs, or because the people who are capable of doing these jobs are also capable of doing other, better paid jobs with better working conditions. As long as employers can coerce people into these jobs by controlling their right to live and work int he US, they will remain unpleasant and/or underpaid jobs, because the market mechanisms that would improve them are subverted through corporate control of the immigration system. To me, what you're describing would be more akin to creating a random lottery and allowing in an extra 65,000 citizens, without a corporation telling them what educational path they are allowed to take, what whiteboard interview questions they are required to answer, what projects they are allowed to work on, or what city they are allowed to live in. You know, free citizens. That, I don't really have any problem with either. But personal freedom for immigrants is the opposite of the H1B.
- e40 10y agoHear hear. The two times my company has used it were just for that reason. In both cases, it was a clear win for both the individual and the company, because we just couldn't find a match in the US. I am 100%, in theory, for this legislation, even though I haven't read it and fear what will be added to it or changed in it.
- pasbesoin 10y agoFurther, with e.g. public state university funding being gutted while large corporations receive never-ending tax breaks, one might argue that, in the larger picture, the same entities are creating the shortages that they then seek H1-B's to "solve". Only... I believe the disconnect occurs before this point. There are U.S. candidates. Companies -- for reasons of cost, control, lack of reciprocity and commitment, ageism, etc. -- simply don't want to hire them. I've watched very competent U.S. staff replaced by inferior foreign staff. This is often NOT a matter of "the most qualified candidate".