36 ms·
How the H-1B Visa System Can Hurt American Workers (2015)
- kelnos 8y agoI know there have been some reforms since 2015, though I haven't kept up with all the details. Isn't there a simple fix for this? Set per-company max percentages for H-1B visa holders. So if it's 15%, and you have 100 employees, only 15 of them can be H-1Bs. I imagine there are probably ways to game this as well, but I'd think it'd be easier to figure out when that gaming is occurring, and shut it down. Or is there just no political will to fix it?
- mc32 8y agoYou could also tax the companies per H-1B [25% -50% of salary?] and dedicate that money to develop native talent [Get kids into STEM starting from K, and train or offer education to candidates wanting to transition into new fields]. If a company really needs these workers, they’ll gladly pay the premium and the local pool of workers or future workers get support to get into that field and reduce the need to import labor. Allow H-1Bs a free transition to alternate co. to ensure commensurate wages.
- kelnos 8y agoAn interesting idea, but in the end probably not something politicians would like. (What does "money to develop native talent" go to, anyway?) Regardless, large companies are experts at shuffling profits around to avoid paying taxes, so I doubt this would curb the abuses. The application process (fees to the government plus paying lawyers) already costs a decent amount, so perhaps just raising those fees would help? The outsourcing companies have pretty deep pockets, though, so in the end that would just hurt smaller shops that actually have a need for H-1B workers. I think per-company caps are the way to go. They don't hurt the companies, and they should actually solve the problem. An alternative might be to just outlaw these sorts of outsourcing firms. Stipulate that H-1B visa holders must be employed by the company where they actually work (no contracting arrangements), and the sponsor of the H-1B can't be a third-party company.
- belltaco 8y agoThere is already such a fee included in H1B application fees that has raised billions for developing native talent.
- munk-a 8y agoYes, there is a trivial fix for this: Remove H-1B visas entirely. H-1B visas lower employee power in the hiring arrangement, forcing potential candidates to accept lower wages by allowing companies to retain existing H-1B workers indefinitely without wage adjustments. Lowering the ability for a class of workers to advocate for themselves lowers the ability for all workers in that field to advocate for themselves by removing a subset of those workers' bargaining power. In all honesty, H-1B visas mostly seem to fit into society as a way to outsource without looking like you're doing so - I'd rather companies outsource as they desire (and feel the penalties of doing so) or be forced to hire from a pool of candidates who were able to legally immigrate into the US. If the pool of candidates available in the US is too low then we should relax quota laws and let more people immigrate. Done. And there is no political will because a lot of companies make tons of money off of exploiting workers who have two options (1) continue working for the company and accrue no or very few benefits over time (2) quit and be deported. Giving your employees a choice like that makes all the worst people in management salivate... thus no one lobbies to remove H-1B visas, many people lobby to maintain or expand this "source of skilled labour" and politicians see no reason to take a stand on an issue that gets very little time in the spotlight and would cost them big in terms of donations.
- euos 8y agoH1 does not lower employee power. I came on H1, got laid off within one year and then had to change companies again in 6 months. I could do it just fine.
- longerthoughts 8y agoTo combat the case presented in the article, I think you'd also need to cap applications at a relatively low percentage of workforce to prevent the flood effect rather than just capping the number of H-1B holders.
- euos 8y agoStaffing companies should not be able to bring people. Only direct hires. This will fix H1 and will not require increasing cap and such.
- MisterBastahrd 8y agoThere's a simpler fix. Companies have gotten away for decades by posting ridiculous job qualifications and then turning around and claiming that since there is no American they can find who is qualified to do the job, that they need to hire cheap foreign talent. I ran into that over and over again as a technical recruiter who would find teams of American citizens and green card holders suddenly displaced by H1s at half their rates. In these instances, companies should pay 150% of the going market compensation to the H1 employee for the position and an additional 50% to a fund which provides training to local job candidates to create future competition for the position.
- Johnny555 8y agoIf the goal is to keep US employers competitive by letting them hire the best and brightest workers from around the world, doubling employee compensation costs is probably not going to achieve that - the companies will just open foreign offices. Which is already happening due to uncertainty of the entire program, my company shifted from opening a USA branch office to opening an european office to make it easier to hire european workers. And it's not like we're using H1-B's as cheap labor, all of our H1-B's are PhD's (well, maybe a few Master's degrees in the mix that have significant experience), and are well compensated. We have a strong USA college recruitment program too.
- dmode 8y agoAs an H1-B visa holder, on EB2 green card queue for 7 years, and in the US for over 12 years, working for a FAANG in the Valley, make a ton of money, I must say it is kind of grinding reading repeated headlines (in HN and elsewhere) about how I am the enemy of the American worker.
- Mountain_Skies 8y agoNothing you wrote in anyway refutes the article's points. If the article is correct, should your feelings be put ahead of the economic wellbeing of citizens of a nation of which you are not a citizen? If the article is not correct, then there are arguments you can make that don't involve your emotional state.
- omegaworks 8y agoThe framing of the article is incredibly rude and dehumanizing to the workers themselves, while burying the actual lede (global outsourcing companies) deep at the end of the page. It's part-and-parcel of the New York Times to lay the blame for bad policies at the feet of the people least in control of and most harmed by those policies. It's objectively bad reporting.
- goshx 8y agoCongrats. I was a H1-B holder myself and I agree. How did you manage to get beyond the 6 years limit for H1-B?
- omegaworks 8y agoAt minimum, they should outlaw global outsourcing companies. They take an inordinate cut from the employee's paycheck for the entire employment period and provide little benefit to either the company trying to hire or the worker being hired. They're glorified recruiters with a foothold in a buyers market, and the H1B system gives them anti-competitive leverage. This whole system of tiered second-class employment creates a slew of perverse incentives. The whole thing should be abolished in favor of clear citizenship pathways and strict visa-blind labor rights across the board.
- MisterBastahrd 8y agoI once worked for a consulting / recruiting firm that ultimately stopped using H1 shops for talent entirely. This came after an incident involving a large cosmetics corporation on a time sensitive project where an H1 employee was ill, and so the project manager decided to go to her hotel to check on her. She found 10 people from the same H1 consultancy living in a 2 bedroom extended stay apartment. Our recruiter had no idea since we only dealt with the contract from the H1 shop. The PM fired everybody from the H1 shop and our company was blacklisted from doing business with them.
- raincom 8y agoIn the end, the employee receives 50% of what that cosmetics co paid to the primary vendor.
- pnw_hazor 8y agoSome Indian consulting companies or (managers at these places) require their Indian H1B employees to kickback some of their official salary. Typically the kickbacks paid by the employee are in the form of donations to selected "charities" back in India. Thus, the w-2 salary of the H1B employee looks reasonable on paper. src: employee-rights lawyer buddies who have sued companies over this.
- raincom 8y ago
- paulsutter 8y agoSignificant changes since this article was published: https://www.cnbc.com/2018/04/20/big-american-tech-companies-are-snapping-up-h1-b-visas.html https://www.cnbc.com/2018/04/20/big-american-tech-companies-... > Four U.S. tech companies — Amazon, Microsoft, Intel and Google — were among the top 10 employers for approved H-1B applications in FY 2017, > The top seven Indian technology companies were given a total of 8,468 H-1B visas in FY 2017 .. a massive drop from FY 2015, when these companies got 14,792 H-1B visas. One of the largest Indian outsourcing firms, Infosys, saw a 49 percent drop between FY 2016 and FY 2017.
- jgalt212 8y agoAmen to that. The labor pool must not be artificially expanded when we have had no real income growth in a generation. Free and Fair Trade and assisting the American worker are the only things Trump is good for. The rest has been a disaster. But if Hilary were in charge, we´d still have unfettered globalization no empathy for the disenfranchised deplorables. Let´s just keep pumping them full of opiods. https://freebeacon.com/issues/hillary-clintons-prescription-pill-problem-oxycontin-inventor-clinton-foundation-donor/ https://freebeacon.com/issues/hillary-clintons-prescription-...
- geofft 8y agoIf the American worker is less competent than the foreign worker, it goes against everything your namesake stands for to have government intervene to assist the American worker. (And yes, national borders are themselves a form of government interference, and a fairly significant one at that.)
- screye 8y agoIt is less about the average American worker and more about statistics. There are 1 billion Indians and Chinese each. When a few thousand of them are migrating to the US every year, you get to meet the candidates that have been pre-screened to be among the best in their respective could tries. Now since the US has better amenities, the 99th percentile Indian, probably rubs shoulders with a 95th percentile American. But even then, there are just as many 99th percentile Asians as there are 95th percentile Americans (due to population differences) If Amazon needs a person who is in the 95th percentile on Math/Analytics/CS , then at a certain point they run out of Americans. They then have 2 options. Either hire 99th percentile Indians or lower the hiring bar. IMO, the US has managed to stay on top in the tech through shameless poaching of top talent across the world. (Among other things) Letting go of this talent, across the board, might lead to short term citizen job growth, but may cause long term job loss as companies setup base elsewhere, in search of talent or competition gets stiffer.
- readhn 8y agoH1-B's are not an issue. The issue is the "consulting" IT companies abusing the H1-B system. Make it illegal for these labor arbitrage companies to exist and at least this problem will be solved.
- beerlord 8y agoIt should be like the visa lottery. Limit any individual country (India or China for example) to a maximum of 10% of the total visa allocation each. Right now India gets 76% of all H1B visas, so Indians know the system inside and out, and hire other Indians. Tech companies are calling out for female workers, and most of these Indian migrants are also male. Take it to 10% from any country max, and heck even require that 51% of the visas must be given out to women, and you will see tech companies scour the globe for talent, rather than all the visas just going to Indian body shops. Under such a change you could even increase the total number of visas issued, since the whole scheme would be less rorted and more socially accepted.
- mavelikara 8y ago> Limit any individual country (India or China for example) to a maximum of 10% of the total visa allocation each. Why country? Why not limit any individual continent to a maximum of 1/7th of the total visa allocation? /s If it isn't clear, I am pointing out that your suggestion is an arbitrary restriction on skilled immigration.
- Bucephalus355 8y agoH1-B employees and American Workers have both been abused by corporations in the US. I have seen this first hand how many people trying to get a junior software development job with decent background experience get the “ladder of opportunity” shoved down the second they try to approach it. I work for one of the Big 4 Consulting companies. Three months ago I met a random barista at a coffee shop who said they wanted to get into software development. I remember thinking “sure whatever”. A month later I was really impressed by their progress. A month after that with even more progress I said I’d hire him because I easily could give him 15-20 hours of extra work that he could do for my team. I said the typical Freelancer hourly rate is to take the yearly salary, divide it by 2, and then that’s the hourly rate. So assuming he would make 80k entry level, hourly rate is $40. This person person just started to cry, loudly and emotionally, when I said that. He said he’d never though he’d make that kind of money in his life. Keep in mind this person had a college degree and was 29. My dad was the kind of person who would never cry, and I try to be like that too, but it was really hard not too at that point.
- prostoalex 8y agoThere are two major sectors relying on H1-B employees - companies whose product is some core tech (mainly in Silicon Valley and Seattle) and companies whose core product is outsourcing & consulting fees. The abuse disproportionately happens with the latter as it’s built into the business model - difference between money billed to clients and money paid out to employees is all pure margin. The question is how to encourage the former type while discouraging the latter. To me a priority queue based on salary makes sense - Facebook or Microsoft are likely to shell out $150,000+ a year for an employee they want, a consulting body shop would not. It also makes sense for the federal government who stands to collect more income tax from higher salaries.
- int_19h 8y agoAnother way is to require companies to offer green card sponsorship for any employee that asks. Sweat shops that use H1B to hire cheap labor are not going to invest in that kind of thing, especially since the end result is that they have less leverage over the employee.
- commonsense1234 8y agothe move towards preference for masters degree is a decent start. there is no way someone with a masters degree would want to work for one of the consulting firms.
- mavelikara 8y agoF-1 students graduating from Masters programs at lower tier schools mostly go work at staffing companies. These companies are worser abusers of H-1B than global outsourcers.
- commonsense1234 8y agoi agree with that. but, the proportion to how many h1bs get allocated to these staffing companies vs outsourcing is maybe 1:20 even if taken as an aggregate. even though it wont entirely eliminate the problem, it is still a good start. The second thing is to create rules to directly discourage indirect employment when on H1B (the abused vendor model).
- mavelikara 8y agoIf you compare two specific companies, your math is right. But if you compare the aggregate number of H-1Bs allocated to all global consulting vendors to those allocated to all American staffing companies, the numbers are much more closer to each other. Agree that stopping third-party employment is a great step. This administration has been doing so by asking for higher levels of documentation.
- interlocutor 8y agoWithout H-1B the tech industry would not be a major industry in the US. Think about it: Yahoo would be a Taiwanese company, Google would be a Russian company, Tesla would be a South African Company, eBay would be a French company, Sun Microsystems would be an Indian company and so on. And that list is just founders. Then there are rank and file employees and inventors in tech companies that came from various parts of the world, that made these founders' dreams into real products. Then there are CEOs and executives that ran these companies. Immigration restrictionists assume a zero-sum math for workers: A job gain for a foreigner is a job loss for an American. By that logic every college graduate who enters the job market would be cause for mourning. But that's backward, given that skilled individuals create, not take away, jobs. This doesn't mean abuse isn't happening. But the abuse doesn't detract from the fact that the tech industry wouldn't be so big in this country without H-1B.
- hartator 8y agoI don’t disagree with your point about immigration being an immigrant myself. However you can’t create a company and work for it under H1-B visa. You need E2, L1-A, or an investor green card.
- comicjk 8y agoTo go further, I suspect that many of those companies would not have been founded at all, reducing the innovation of the world as a whole. Even all countries, put together, are not a zero-sum game: freer movement of people can increase total opportunities for human achievement.
- htormey 8y agoThe H-1B visa is not designed to encourage people to start new companies. It’s for people coming to America who want to work for existing ventures. If you are from India or China you will likely spend a decade or more on this visa before you can get a green card and be able to start your own company. Europeans have it a little better as visa quotas are based on geographic regions. I know all this because I was on a H1B for 6 years. I really wanted to start my own company but I couldn’t do so until I got my green card. I think it’s wrong to conflate arguments in favor of immigrant founders with H1B workers. H1B visa holders are easier to exploit than US citizens as they have no real job security. This is the main point of contention with the visa and as a former H1B holder I feel inclined to agree with this critique. I wish the companies and individuals who call for more H1B visas would instead call for comprehensive visa reforms which would enable qualified immigrants to start companies immediately.
- godelmachine 8y agoIs Trump gonna introduce the points based system at all, which specifically favors those foreigners who have degrees from US universities?
- part3 8y agoAs an american, I'm really surprised at the quality of responses here which are mostly skeptical of H-1B immigration benefits but then I see full throated support to low skilled immigration. Is this because I'm from a flyover state and can see the first hand damage low skilled immigration causes and most here are ignoring that?
- mdorazio 8y agoI like to think of it this way: the H1B program is well-intentioned, but has been hijacked to a large degree by outsourcing companies and corporations just looking to cut costs to the detriment of American workers. There are companies using the program in a good way, but there are also a lot using it in a bad way so you get a mix of opinions in comment threads like this one. On the low-skill immigration side, it can be a good thing when immigrants come to areas with plenty of jobs and act as supplementary labor rather than as direct competition. For example, in some urban centers, immigrants make up a large portion of nannies because working parents need help raising kids, but local residents often don't want to do that kind of work. The net result is more productive parents and an immigrant labor pool fulfilling a needed role. On the other hand, in flyover states you tend to have a different set of labor supply and demand situations and low skill immigrants can be detrimental. Most HN commenters are yuppies rather than rural residents, so you get more emphasis on immigration being a good thing.
- part3 8y ago> immigrants make up a large portion of nannies Those jobs would go to citizens if they weren't taken up by immigrants. Sure, the salary requirements would increase, but isn't that literally the rallying cry of politics right now? To pay people more? So I have trouble squaring this: we want more low skilled immigrants, we don't want to build a wall or any deterrant actually but we need to cap and reduce high skilled immigration? Meanwhile, we need to lobby for more destructive policies that will reduce the flyover states voting power?
- mdorazio 8y agoThat's highly debatable. Nannies only make sense if you pay your nanny significantly less than your own after-tax salary. If the price is too high, one parent just stops working because doing otherwise is foolish financially and because "I'm spending all my money to pay a stranger to raise my kids." So if immigrants were not available for the work and salaries rose accordingly, a significant number of parents would leave the workforce and lower overall productivity in the local economy. That's what I mean by supplementary labor. Your last comment is assuming complete lack of nuance in common opinions. You need to add some qualifiers to make it accurate. Something like this: We want more low skilled immigrants where they supplement rather than compete with local labor, ... we need to revise the program for highly-skilled immigration without necessarily reducing overall number of immigrants since it has been abused by multiple companies. I'm not sure what you're referring to on your last point. Flyover states and rural communities in general are rather overrepresented in politics today [1]. Most debate on this issue I'm aware of is focused on returning to parity in representation. [1] https://www.nytimes.com/2016/11/21/upshot/as-american-as-apple-pie-the-rural-votes-disproportionate-slice-of-power.html https://www.nytimes.com/2016/11/21/upshot/as-american-as-app...
- TomMckenny 8y agoIt's a really pity we can't have more calm, clear conversions like the nyt article and this thread. Regrettably, for the most part, conversations on the issue deteriorate into one camp denying any problem exists, that several FANG companies were founded by H1-B folk etc and the other camp espousing a generalized xenophobia. And it really is something that needs to be looked at and fixed or the angry people are just going to become more numerous and more extreme with demagogues whipping the flames leading to who knows what outcome.