GAO Report Adds Needed Transparency to H-1B Visa Debates

Ann All

Two things I know about H-1B visas: There's no shortage of opinions about them, many of them negative, and there's surprisingly little reliable data about the controversial visas.


When the in 2007 asked companies including Cisco and HP how many of their employees were visa holders, the publication got some incredibly vague answers. (From Cisco: "... as Cisco hiring overall has increased in recent years, so has our use of H-1Bs to fill certain highly specialized positions.") The found the U.S. Department of Homeland Security's estimate of Oracle's H-1B headcount was quite different from the U.S. Department of Labor's estimate-and neither matched Oracle's own data.


The Government Accountability Office is trying to address the dearth of data about H-1Bs with a report released on Friday, reports Computerworld. The GAO collected data from several government agencies to produce the report, which includes the types of jobs held by visa holders, the salaries they earn and their countries of origin. Proponents and opponents of the visas alike will find information to support their views.


Between 2000 and 2009, more than 40 percent of visa holders were hired for systems programming and analysis jobs. The GAO concluded H-1B workers are "often not paid wages associated with the highest skills in their fields." According to the report, 54 percent of H-1B employees from June 2009 to July 2010 "were categorized as entry-level positions and were paid at the lowest pay grades allowed under prevailing wage levels." H-1B opponents have long insisted that there is no shortage of these kinds of skills in the U.S., as companies applying for visas claim, but rather companies do not want to pay the going rate for these skills.


Last spring two professors at the University of Maryland's Robert H. Smith School of Business produced a report that challenged this idea, finding workers with H-1B visas earned more than their counterparts with U.S. citizenship. Many observers, including IT Business Edge contributor Don Tennant, questioned the validity of the report's methodology.


The GAO also found the number of H-1B petitions tends to rise when wages and employment for U.S. workers are also rising and to fall when wages and employment for U.S. workers are falling, seemingly supporting H-1B proponents' view that the overall economy effectively regulates H-1B usage. But, according to the report, "... this relationship does not reveal what the wage rates and employment rates of U.S. workers would have been in the absence of H-1B workers."


The report also found less than 1 percent of employers with approved petitions accounted for 30 percent of all H-1B hires between 2000 and 2009, with Indian outsourcing companies among the heaviest users of H-1Bs in 2009. Earlier concern over these kinds of numbers prompted Sens. Chuck Grassley (R-Iowa) and Richard Durbin (D-Ill.) in 2007 to ask nine foreign firms for information on how they use H-1Bs.


The GAO also provides examples of what seem like unnecessary bureaucracy encountered by companies filing H-1B petitions. Frustrations with the lottery process the government uses to assign visas once the annual cap on them is exceeded has prompted some companies to employ workers overseas and then transfer them to the U.S. on an L-1 visa, according to the report.


The GAO has recommended the creation of a centralized website where businesses would be required to post notice of their intent to hire H-1B workers, an idea endorsed by the Department of Justice, with a DOJ official saying such a site could help identify employers with a pattern of discriminatory hiring practices.


I suspect H-1B proponents will see such a site as intrusive and unnecessary while opponents think it won't do enough to highlight H-1B abuses. But I think it's a great first step to add transparency to a system that so obviously needs it.


There's a third thing I know about H-1B visas: Lawyers helping companies navigate the often complicated application and employment processes are among the biggest fans. As I wrote last March in a commentary on a legislative proposal that would modify the existing EB-5 visa to make it easier for foreign-born entrepreneurs with financial patrons to immigrate to the U.S., I've often wondered if lifting caps on hotly contested visas would ultimately result in less gaming of the system, especially if a removal of caps was accompanied by requirements for more transparency in how visas are used. I think it would force more honest discussions, which would be a good thing.

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Jan 19, 2011 5:56 AM R. Lawson R. Lawson  says:

" I've often wondered if lifting caps on hotly contested visas would ultimately result in less gaming of the system, especially if a removal of caps was accompanied by requirements for more transparency in how visas are used. I think it would force more honest discussions, which would be a good thing."

I honestly don't understand how an intelligent person can look at the available data out there and even ponder if lifting caps will some how make things better. 

What you need to come to terms with is that the US Government and corporations will never work together and effectively administer the program.  The US Government is controlled by powerful business interests who have every incentive to game the system.

The notion of unlimited caps defies basic economics.  We know that H-1b workers make less money that American workers in similar roles.  Not only does the data suggest this, people in the know also say the same thing.  Just because there isn't a million dollar study supporting a viewpoint doesn't make it wrong.

Is it logical to assume that having more H-1b workers will somehow increase their salaries?  Of course not!

The only thing you need to understand are the basic laws of supply and demand.  There is a finite demand for IT workers.  When supply exceeds that demand, the workers who demand more money will either need to demand less money or they will be pushed out.  The logical thing to assume is that if we have more H-1b workers in the IT occupation, as long as demand remains the same we should expect American workers to see their salaries decrease and we should also expect to see them pushed out.

Unfortunately, because of globalization trends, the IT job market is not expected to grow very rapidly.  It has actually been shrinking over the last two years.  So what you are pondering is what will happen when we increase the supply of labor at a time with the demand is dropping. 

Do we have a single example of a policy change that raised salaries of both immigrants and domestic workers while both increasing domestic employment and increasing the number of worker visas?  Just one?  Perhaps in theory this is possible, but in practice - because of the hyper-influence of corporate lobbyists - this is not going to happen under any circumstance.

I am married to an immigrant.  My step-mother is an immigrant.  My step-brother is an immigrant who became and Army doc and served in Iraq, among other places.  I don't have some anti-immigrant chip on my shoulder like many people do, and am proud of the example set by my immigrant brother.  But at the same time you can't ignore basic economics and you can't throw logic out the window. 

The "right" thing to do is make immigration an agreement between an immigrant and our nation.  That agreement is simply that immigrants will follow our laws and support generally accepted American values.  I don't believe that corporations should be middle-men in this agreement because they have a long history of exploiting and in many cases breaking our laws.  Immigration should not be about cheap labor.  It should be entirely about building a stronger base of citizens and residents.

The bottom line is that the motivations driving employer sponsored visas have nothing to do with welcoming new people to our nation and building a stronger base of citizens.  It's entirely about money.  Money is something we earn and need in our society, but it shouldn't define who we are.  When you inject money into immigration, it is defining who we are as simply humans worth only the profits they produce.  That's not an American value.


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