Reform Comes Slowly to H-1B Program

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American workers may wish to invest in education while waiting for government help.


The employment figures for August will be released today by the Bureau of Labor Statistics, and the figures are likely to be similar to those we got in July—several hundred thousand more jobs lost. The average monthly job loss from May through July was 331,000, and it's likely the figures for August will reflect another 300,000 or so jobs that have disappeared during the past month. Today, there are 14.5 million people out of work in the United States, which has an unemployment rate of 9.4 percent. If you are fortunately not one of the statistics, you probably are related to someone who is or certainly have friends who have lost their jobs—and more.


The recession has had a slight dampening effect on the H-1B visa program, an employer-sponsored government program that is a particular sore point for high-tech workers who believe, rightly or wrongly, that foreign-born workers are taking jobs that they might otherwise have been given. Last year, 133,000 applications for the 65,000 H-1B visas were granted, with about half going to high-tech companies. This past April, only about half of the 65,000 available visas were taken within two weeks after the annual lottery began. This compares to all 65,000 slots being assigned on the first day of the lottery in 2008.


The figure of 65,000 is somewhat misleading because the first 20,000 H-1B petitions filed by or for aliens who have earned a master's degree or higher are exempt from this 65,000 total. Also exempt are foreign workers who plan to toil in higher education or affiliated nonprofits or at nonprofit research organizations or governmental research facilities.


The H-1B program is a temporary work visa program allowing American companies and universities to employ foreign workers who have the equivalent of a U.S. bachelor's degree in a job category that is classified by the U.S. Citizenship and Immigration Services as a "specialty" occupation. Critics of the program have said for years that employers are just using the H-1B visas to hire workers for less than the prevailing wage rate in the U.S. The issue was debated back and forth, but a recent government report cited rampant fraud in the H-1B program and revealed a more than 20 percent violation rate by employers using the program.


High-tech employers have been trying to get Congress to increase the 65,000 worker limit, but abuses in the system have made lawmakers wary of any expansion of the program. Senators Charles Grassley (R-Iowa), Dick Durbin (D-Illinois), and Bernie Sanders (I-Vermont) are trying to get legislation passed that would require employers to make a good-faith effort to hire American workers first, and employers would have to show that the H-1B workers would not displace an American worker. The H-1B and L-1 Visa Reform Act would also put a stop to what Grassley and Durbin call the "blatantly discriminatory" practice of "H-1B only" ads and prohibit employers from hiring additional H-1B workers if more than 50 percent of their employees have H-1B visas. So far, their efforts to reform the H-1B system have failed, partly because the measure gets caught up in the larger, and politically explosive, immigration reform legislation.


Grassley said in a statement that "in tough economic times like we're seeing, it's even more important that we do everything possible to see that Americans are given every consideration when applying for jobs." The Grassley-Durbin legislation would strengthen the government's ability to investigate potential H-1B fraud, since the Department of Labor apparently doesn't have the authority today to open an investigation into an employer suspected of abusing the H-1B program unless it receives a formal complaint.


While the actual number of H-1B visas is small compared to the size of the American work force as a whole, the concept irks many professionals. Six of the top 10 users of temporary work visas in 2007 were Indian firms, with Infosys Technologies having 4,559 approved visa petitions and Wipro some 2,567. Two companies with U.S. headquarters but that mostly operate in India—Cognizant Technology Systems and UST Global—were also among the top 10.


There has been some movement in Congress in support of workers. It recently passed the Employ American Workers Act, which prevents a company from displacing U.S. workers when hiring H-1B specialty occupation workers if the company received stimulus funds from Congress. The law went into effect last February and applies to any hiring taking place until February 17, 2011.


The irony is that, while the law makes it more difficult for employers in the financial industry to hire H-1B workers, it frees H-1B workers for hire by the high-tech sector (which has not been receiving the specified stimulus funds).


Some argue that imposing artificial limits on H-1B workers actually is bad for the economy because it restricts businesses from growing and thus impedes them from creating more new jobs. There may be some evidence to support that notion, and if it were ever proven true, those who are complaining about the H-1B workers could more aptly be grouped with proponents of protective trade tariffs to insulate American markets versus those who believe in free trade as the way to achieve a more robust business climate.


In any case, the debate will rage on with some unemployed and underemployed high-tech workers blaming H-1B visas for lost employment opportunities while others see the ailing economy as being largely to blame. Nevertheless, the one fundamental that seems to be a refrain that all top consultants stress during difficult economic times is that highly skilled and knowledgeable workers are always in short supply, both at home and abroad. If you want a job in the economy of the next decade, you will need a good education and training in the latest technologies.


The reason that legitimate H-1B workers are in demand is that they present a good value to employers. We must ask ourselves whether we offer an employer the skills and expertise they want and need at a price that they can afford. Or, conversely, whether we present yesterday's tarnished skill set at an inflated and unrealistic rate. It may prove far easier to control our individual educational achievements than to influence national immigration policy, whether that policy be unfair or not.