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I would like to add an additional layer of economic nuance here, beyond Econ 101 and BA Econ. While it is true that an economy is not necessarily a fixed “lump

I would like to add an additional layer of economic nuance here, beyond Econ 101 and BA Econ. While it is true that an economy is not necessarily a fixed “lump of labour”, you also need to take into consideration many more factors before making another blanket statement about how labour and an economy works. There are localized crowding effects that take place at all levels of labour (bottom to the top), and various market frictions which you ignore talking about. The economy is not perfect, perfectly efficient, or perfectly distributed. I won’t even get into monopolies and monopsonies, but suffice to say that market forces can be highly skewed. Markets are typically highly constrained in relative size and don’t freely grow independently. Adding 1000 more H1Bs this year does not mean the tech sector will grow by an additional 1500 U.S. citizens as well. Labour growth is organic and requires training and experience to grow. If most new tech positions are created for visas, citizens will never enter the field, or gain training and experience to compete. When crowding in a market increases, the market is very slow to react and expand. This is especially true in a more mature system like the USA, where the frontier days have mostly ended, and future growth is slower and more expensive. The U.S. economy has certainly shifted (perhaps especially so around 1970) into growing the pie less, and more growing your slice. Let’s not be naive either, because we know that visa data is publicly available. We should not rely too much on economic theory from Exon 101 when we can check the theory against what actually happens and is measured (empirics). As an experiment you should compare the annual H1B visa cap against the number of new “tech hires” in the economy. The trend you see is that every year, tech grows by ONLY the number of visas they are granted for that year. You probably think I’m pulling your leg, but please check for yourself. Now please tell me honestly... From the data, which theory of the labour market do you think best describes the history of the tech sector in the USA? Hint, the lump of labour fallacy is not always a fallacy. Now your follow up question is, if the labour market experiences localized crowding, and citizens may be in direct competition with non-citizens for their jobs, what might happen to citizen wages that are under this competitive environment?

DiogenesKynikos 7y ago
> The trend you see is that every year, tech grows by ONLY the number of visas they are granted. That very strongly suggests that there's a shortage of tech workers in the United States. What's the unemployment rate for CS majors? [1] > From the data, which theory of the labour market do you think best describes the history of the tech sector in the USA? The data appears to describe a tech sector that cannot find enough skilled workers to fill the positions it has available. Virtually all of the CS majors are employed. There is a large pool of skilled labor abroad, however, which US tech companies would like to tap into. They have two ways to do so: getting those workers to come to the US or setting up shop where the workers are. There seem to be a lot of protectionist-minded tech workers in the US who are convinced that their salaries would increase if there were fewer visas handed out. That's probably true in the short run. If you constrict the labor supply, you force companies to outbid one another to hire the remaining workers. But once that initial shock subsides, companies will wise up and expand their operations overseas, where skilled labor is cheaper. 1. The answer seems to be about 2%, with less than 1% of CS majors being unemployed for longer than 26 weeks: https://www.forbes.com/sites/stuartanderson/2018/05/29/unemployment-low-for-computer-professionals-and-everyone-else/ https://www.forbes.com/sites/stuartanderson/2018/05/29/unemp...
- unimployed 7y ago
  I believe your interpretation is being disingenuous with the data and everything known about how H1Bs are utilized. You seem to gloss over the fact that tech jobs don’t actually require everyone to hold a specific CS degree (in reality and practice few do if you have the skills). So once you expand your definition of skilled workers to include everyone that could adequately fill such positions, you are looking at a much larger pool of workers than just fresh CS grads. You definitely don’t need a CS degree to be a low level analyst, tester, etc. which has been a pretty popular H1B position. From the linked article, you likely also have adequate coding skills if you come from an engineering, scientific, STEM, or similar background. Then add people from bootcamps that came from outside STEM. You also ignore that H1Bs are frequently used to replace citizens, their poor working conditions, and lower salaries. You seem to apply to another perpetual myth in economics that companies like to spout about labour shortages and skilled labour shortages. There are few if any economic studies that conclude there are actual widespread shortages of candidates with necessary skills. What you seem to ascribe to is a shortage of workers that are willing to be taken advantage of, work for lower wages, and work in poor conditions.
  - DiogenesKynikos 7y ago
    "Disingenuous" means "dishonest." Did you actually intend to accuse me of dishonesty? > From the linked article, you likely also have adequate coding skills if you come from an engineering, scientific, STEM, or similar background. The linked article discusses the fact that people with a broad range of undergraduate computer-, math- and engineering-related degrees have unemployment rates of 1.5-2% in the United States. Long-term unemployment for these groups is even lower, in the 0.4-0.7% range. > Then add people from bootcamps that came from outside STEM. Now you're discussing people who likely don't have the same qualifications as people coming in on H1B visas. On the other hand, you're not providing any evidence that these people have trouble finding employment in the tech sector, so I don't know what I'm supposed to make of your argument here. > You seem to apply to another perpetual myth in economics that companies like to spout about labour shortages and skilled labour shortages. Everything you're describing points towards a constrained labor market in tech. Unemployment for people with relevant undergraduate degrees is near 0%. Companies are desperate to increase the number of visas for tech workers. People can go to "bootcamps" for a few weeks to get basic training in programming, and then quickly find high-paying employment. If I can add to that: big tech companies are offering lavish workplace benefits (free gourmet food, free gyms, free transportation, etc.) in order to try to attract talent. This all points towards a very tight labor market in tech. > You also ignore that H1Bs are frequently used to replace citizens, their poor working conditions, and lower salaries. [...] What you seem to ascribe to is a shortage of workers that are willing to be taken advantage of, work for lower wages, and work in poor conditions. I've read the horror stories, just like everyone else. But in general, we're talking about people making 80k+ USD per year, many far more. Most people in America would love to be "taken advantage of" for $100k/year. It's very difficult to get behind a political call to action to exclude foreigners from the labor market in order to limit wage competition for people in the top few percent of the income distribution.

DiogenesKynikos 7y ago

> The trend you see is that every year, tech grows by ONLY the number of visas they are granted. That very strongly suggests that there's a shortage of tech workers in the United States. What's the unemployment rate for CS majors? [1] > From the data, which theory of the labour market do you think best describes the history of the tech sector in the USA? The data appears to describe a tech sector that cannot find enough skilled workers to fill the positions it has available. Virtually all of the CS majors are employed. There is a large pool of skilled labor abroad, however, which US tech companies would like to tap into. They have two ways to do so: getting those workers to come to the US or setting up shop where the workers are. There seem to be a lot of protectionist-minded tech workers in the US who are convinced that their salaries would increase if there were fewer visas handed out. That's probably true in the short run. If you constrict the labor supply, you force companies to outbid one another to hire the remaining workers. But once that initial shock subsides, companies will wise up and expand their operations overseas, where skilled labor is cheaper. 1. The answer seems to be about 2%, with less than 1% of CS majors being unemployed for longer than 26 weeks: https://www.forbes.com/sites/stuartanderson/2018/05/29/unemployment-low-for-computer-professionals-and-everyone-else/ https://www.forbes.com/sites/stuartanderson/2018/05/29/unemp...

unimployed 7y ago
I believe your interpretation is being disingenuous with the data and everything known about how H1Bs are utilized. You seem to gloss over the fact that tech jobs don’t actually require everyone to hold a specific CS degree (in reality and practice few do if you have the skills). So once you expand your definition of skilled workers to include everyone that could adequately fill such positions, you are looking at a much larger pool of workers than just fresh CS grads. You definitely don’t need a CS degree to be a low level analyst, tester, etc. which has been a pretty popular H1B position. From the linked article, you likely also have adequate coding skills if you come from an engineering, scientific, STEM, or similar background. Then add people from bootcamps that came from outside STEM. You also ignore that H1Bs are frequently used to replace citizens, their poor working conditions, and lower salaries. You seem to apply to another perpetual myth in economics that companies like to spout about labour shortages and skilled labour shortages. There are few if any economic studies that conclude there are actual widespread shortages of candidates with necessary skills. What you seem to ascribe to is a shortage of workers that are willing to be taken advantage of, work for lower wages, and work in poor conditions.
- DiogenesKynikos 7y ago
  "Disingenuous" means "dishonest." Did you actually intend to accuse me of dishonesty? > From the linked article, you likely also have adequate coding skills if you come from an engineering, scientific, STEM, or similar background. The linked article discusses the fact that people with a broad range of undergraduate computer-, math- and engineering-related degrees have unemployment rates of 1.5-2% in the United States. Long-term unemployment for these groups is even lower, in the 0.4-0.7% range. > Then add people from bootcamps that came from outside STEM. Now you're discussing people who likely don't have the same qualifications as people coming in on H1B visas. On the other hand, you're not providing any evidence that these people have trouble finding employment in the tech sector, so I don't know what I'm supposed to make of your argument here. > You seem to apply to another perpetual myth in economics that companies like to spout about labour shortages and skilled labour shortages. Everything you're describing points towards a constrained labor market in tech. Unemployment for people with relevant undergraduate degrees is near 0%. Companies are desperate to increase the number of visas for tech workers. People can go to "bootcamps" for a few weeks to get basic training in programming, and then quickly find high-paying employment. If I can add to that: big tech companies are offering lavish workplace benefits (free gourmet food, free gyms, free transportation, etc.) in order to try to attract talent. This all points towards a very tight labor market in tech. > You also ignore that H1Bs are frequently used to replace citizens, their poor working conditions, and lower salaries. [...] What you seem to ascribe to is a shortage of workers that are willing to be taken advantage of, work for lower wages, and work in poor conditions. I've read the horror stories, just like everyone else. But in general, we're talking about people making 80k+ USD per year, many far more. Most people in America would love to be "taken advantage of" for $100k/year. It's very difficult to get behind a political call to action to exclude foreigners from the labor market in order to limit wage competition for people in the top few percent of the income distribution.