5 ms·

If I have some work that is profitable at a cost of labour of $100k/year and no American wants to work for less than $120k then I can either hire an H1B for $10

by aianus 10y ago

If I have some work that is profitable at a cost of labour of $100k/year and no American wants to work for less than $120k then I can either hire an H1B for $100k or abandon the project. It doesn't benefit anyone to have the latter outcome occur.

intrasight 10y ago
Economists would disagree.
- aianus 10y ago
  I don't think they do -- it's pretty basic economics that price fixing and/or supply shocks can result in smaller net economic output. For a thought experiment: imagine if the price of a haircut was fixed by law at $500 (or that 99% of barbers suddenly died and the price naturally surged to $500). Enough people would start cutting their own hair at home that the entire haircut GDP and employment of the nation would go down. Even though the lucky few who still have jobs have excellent wages and there is still a steady supply of haircuts to rich people willing to pay $500 a pop.
  - intrasight 10y ago
    There no "law" in the current context except the law of supply and demand.
    - aianus 10y ago
      The relevant law is the one where you need a certain visa or a greencard to get a job in the US.
jlarocco 10y ago
If the thing you're creating can't cover the costs of making it then it's not a good enough product and you should find something else to do. It sucks, but that's the way it works.
- xerophyte12932 10y ago
  Or I could just find a way to lower my costs. Also, this applies to the skills of the employee. If your skills aren't good enough that people would pay top dollar for them, then you should find something else to do. it sucks, but that's the way it works.
  - closeparen 10y ago
    "The way it works" can be altered through legislation, as is happening here.
- Const-me 10y ago
  In this century it doesn't work this way. Because now you can develop and even manufacture your product elsewhere. There’re places outside US where you can find top-notch people for less than $100k.
  - jlarocco 10y ago
    No, it still works this way, but society has put in place rules and regulations defining what is allowable and what isn't. Companies can cut costs by dumping waste in a river and burning garbage, too, but we don't let companies do that any more. If a company wants to operate in a country then they need to obey the laws of that country.
- kalleboo 10y ago
  And instead let a Chinese company develop that next greatest thing
- aianus 10y ago
  > It sucks, but that's the way it works. But in this case it doesn't suck for the rich management and shareholders (they'll manage just fine without doing the project at all) it mostly just sucks for the taxpayers who get less tax revenue, the community that has one fewer consumer, and the foreigner who has to stay put in his country working at something even less productive making $25k.
Trundle 10y ago
The latter outcome benefits the employee who is elsewhere earning $100k+.
randomdata 10y ago
If it is always better to move forward with a project with the cheapest labour available to fill the role, what purpose does the H1B system serve? Why not just grant entry to everyone who has a wanting employer without all the unnecessary hoops?
- aianus 10y ago
  > what purpose does the H1B system serve I assume the purpose is to select only those who are going to be employed securely enough at a high enough salary that they're extremely unlikely to ever go on welfare or otherwise be a net burden on the US.
toast0 10y ago
$100k plus legal fees (about $5k[1]), plus a super long wait between offer and start date. [1] https://www.hooyou.com/h-1b/attorneyfee.html https://www.hooyou.com/h-1b/attorneyfee.html
briandear 10y ago
If I could sell a Mercedes at $20k, that would only be profitable if I could pay <$20k for the car. Mercedes and the economy are missing out because of the commerce not being transacted right? The idea that work that's profitable at $100k and not at $120k -- that means that the work isn't profitable if the market cost is $120. Everything is profitable if the cost of inputs is less than the sales price. It's an absurd argument. Essentially, your statement singlehandedly destroys minimum wage arguments. "If I could pay less, then I could be profitable, otherwise I am not profitable and thus won't hire anyone." But you are also admitting that the purpose of H1 isn't to fill shortages -- it's to fill shortages of people willing to work at a rate below what the market dictates. It's like the illegal immigrant advocates that claim that Americans don't want to pick fruit -- at $5 per hour, probably not. But at $15 per hour, suddenly there isn't a shortage. Except in rare cases, H1s are not used to fill actual shortages but to lower costs. A junior level Tata engineer isn't filling a shortage of skills, they're filling a shortage of engineers willing to work for $50k per year.
- aianus 10y ago
  > Essentially, your statement singlehandedly destroys minimum wage arguments. "If I could pay less, then I could be profitable, otherwise I am not profitable and thus won't hire anyone." Yes, it does. Minimum wage laws are not good economics. We would be better served scrapping them and instituting a basic income to ensure a quality-of-life floor instead.
- mmirate 10y ago
  > Essentially, your statement singlehandedly destroys minimum wage arguments. "If I could pay less, then I could be profitable, otherwise I am not profitable and thus won't hire anyone." Yes. That statement shows exactly why minimum wage is economically unsound in the long-term. e.g. why else would McDonald's feel the need to automate their cashiers?

by aianus 10y ago

intrasight 10y ago

Economists would disagree.

aianus 10y ago
I don't think they do -- it's pretty basic economics that price fixing and/or supply shocks can result in smaller net economic output. For a thought experiment: imagine if the price of a haircut was fixed by law at $500 (or that 99% of barbers suddenly died and the price naturally surged to $500). Enough people would start cutting their own hair at home that the entire haircut GDP and employment of the nation would go down. Even though the lucky few who still have jobs have excellent wages and there is still a steady supply of haircuts to rich people willing to pay $500 a pop.
- intrasight 10y ago
  There no "law" in the current context except the law of supply and demand.
  - aianus 10y ago
    The relevant law is the one where you need a certain visa or a greencard to get a job in the US.

jlarocco 10y ago

If the thing you're creating can't cover the costs of making it then it's not a good enough product and you should find something else to do. It sucks, but that's the way it works.

xerophyte12932 10y ago
Or I could just find a way to lower my costs. Also, this applies to the skills of the employee. If your skills aren't good enough that people would pay top dollar for them, then you should find something else to do. it sucks, but that's the way it works.
- closeparen 10y ago
  "The way it works" can be altered through legislation, as is happening here.
Const-me 10y ago
In this century it doesn't work this way. Because now you can develop and even manufacture your product elsewhere. There’re places outside US where you can find top-notch people for less than $100k.
- jlarocco 10y ago
  No, it still works this way, but society has put in place rules and regulations defining what is allowable and what isn't. Companies can cut costs by dumping waste in a river and burning garbage, too, but we don't let companies do that any more. If a company wants to operate in a country then they need to obey the laws of that country.
kalleboo 10y ago
And instead let a Chinese company develop that next greatest thing
aianus 10y ago
> It sucks, but that's the way it works. But in this case it doesn't suck for the rich management and shareholders (they'll manage just fine without doing the project at all) it mostly just sucks for the taxpayers who get less tax revenue, the community that has one fewer consumer, and the foreigner who has to stay put in his country working at something even less productive making $25k.

Trundle 10y ago

The latter outcome benefits the employee who is elsewhere earning $100k+.

randomdata 10y ago

If it is always better to move forward with a project with the cheapest labour available to fill the role, what purpose does the H1B system serve? Why not just grant entry to everyone who has a wanting employer without all the unnecessary hoops?

aianus 10y ago
> what purpose does the H1B system serve I assume the purpose is to select only those who are going to be employed securely enough at a high enough salary that they're extremely unlikely to ever go on welfare or otherwise be a net burden on the US.

toast0 10y ago

$100k plus legal fees (about $5k[1]), plus a super long wait between offer and start date. [1] https://www.hooyou.com/h-1b/attorneyfee.html https://www.hooyou.com/h-1b/attorneyfee.html

briandear 10y ago

If I could sell a Mercedes at $20k, that would only be profitable if I could pay <$20k for the car. Mercedes and the economy are missing out because of the commerce not being transacted right? The idea that work that's profitable at $100k and not at $120k -- that means that the work isn't profitable if the market cost is $120. Everything is profitable if the cost of inputs is less than the sales price. It's an absurd argument. Essentially, your statement singlehandedly destroys minimum wage arguments. "If I could pay less, then I could be profitable, otherwise I am not profitable and thus won't hire anyone." But you are also admitting that the purpose of H1 isn't to fill shortages -- it's to fill shortages of people willing to work at a rate below what the market dictates. It's like the illegal immigrant advocates that claim that Americans don't want to pick fruit -- at $5 per hour, probably not. But at $15 per hour, suddenly there isn't a shortage. Except in rare cases, H1s are not used to fill actual shortages but to lower costs. A junior level Tata engineer isn't filling a shortage of skills, they're filling a shortage of engineers willing to work for $50k per year.

aianus 10y ago
> Essentially, your statement singlehandedly destroys minimum wage arguments. "If I could pay less, then I could be profitable, otherwise I am not profitable and thus won't hire anyone." Yes, it does. Minimum wage laws are not good economics. We would be better served scrapping them and instituting a basic income to ensure a quality-of-life floor instead.
mmirate 10y ago
> Essentially, your statement singlehandedly destroys minimum wage arguments. "If I could pay less, then I could be profitable, otherwise I am not profitable and thus won't hire anyone." Yes. That statement shows exactly why minimum wage is economically unsound in the long-term. e.g. why else would McDonald's feel the need to automate their cashiers?