Well with HR point of view, US citizen gets cut. Not just in this scenario my friend. I am in this business(recruitment). Let me give you another tough scenario

Well with HR point of view, US citizen gets cut. Not just in this scenario my friend. I am in this business(recruitment). Let me give you another tough scenario (forget H1b). Two people in same job with similar performance one is US citizen who is contracting and while other is US citizen who is full time with company. As we know the contractor salary is very high.Layoffs are coming, But still HR will fire full time US citizen who is getting less pay because to fire a full time employee we need to wait till next lay offs or provide a big reason to fire him. While on other hand you can fire Contractor any time without any formalities. My point is if you want to abuse H1b program you will abuse it no matter what. It all depends on work culture(HR) of a COMPANY.