Race Is on for H-1B Visas

Ann All

The issue of whether to increase the number of H-1B visas allowed in the U.S. each year provokes strong feelings, on both the pro and con sides of the fence. For proof, see the reader comments that follow my previous blog post on the topic.

 

My husband was particularly taken with the reader who called me a "dump ass." (Thanks, honey.)

 

There seems to be one indisputable fact in the highly-charged debate: Demand far outpaces supply for the visas, which allow U.S. companies to employ skilled foreign workers.

 

An attorney specializing in immigration issues quoted in an InfoWorld article advises companies to waste no time filing applications for the visas. Those that wait until April, when the U.S. Bureau of Citizenship and Immigration Services (USCIS) begins accepting them, likely will lose out. "It's sort of like a race," she says.

 

Sort of? Last year, the supply was exhausted just two months after the USCIS started taking applications. The cap for visas open only to foreigners with advanced degrees from U.S. universities was reached just two months after that.


 

While an earlier InfoWorld article reported that some lobbyists see the recent change of Congressional leadership, from Republican to Democrat, as a logical time to revisit the issue of allowing more H-1B visas each year, the latest article says that at least some incoming Democrats are on the record as being opposed to such an increase.

 

The IEEE-USA, part of the Institute of Electrical and Electronics Engineers, is pushing for improvements in oversight of the visas. For instance, it wants the Department of Labor to gain more authority to audit employers. We definitely think this is a great idea, particularly since a recent Government Accountability Office study found many errors in petitions for visas reviewed by the department.



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Jan 10, 2007 9:03 AM Steve Gates Steve Gates  says:
Demand may outpace the h-1b quota but not the national need. A recent investigative series in the Portland Press-Herald noted man more H-1B applications were being filed for Maine than there were jobs. Congressional testimony in may noted that in NJ there are FIVE h-1b visas issued for computer programmers for every programming job created. I also point out that the GAO report mentioned above only touched the tip of the iceberg as it only dealt with some of the errors that the DoL might be able to screen under its extremely limited authority. Reply
Jan 10, 2007 11:20 AM Quoto Quoto  says:
It’s far worse for foreign students. Many are being advised to postpone their graduation and work around the H1b visa 'calendar'. Lucky few who have been hired by bigwigs are being sent elsewhere UK, Europe to work.These are the very students US universities have trained and shouldn't US be benefited from them. Why should these other countries benefit from their innovation and hard work when we trained them!!! Not to forget the taxes and community contributions these highly educated people make. Don’t be surprised if you read about a great innovator or entrepreneur from Canada or Australia who incidentally was educated and trained in US but couldn’t stay here for because of visa/greencard issues!   Reply
Jan 25, 2007 9:45 AM Jay Jay  says:
The Immigration department should consider granting more immigration visas only to foreign students studying in our universities and not to foriegn workers being brought here to work as cheap slave labor. A separate visa category for them is what is required.Most of these H1-Bs are taken up by Indian outsourcing companies like Infosys, Wipro etc. These people get cheap labor from India and pay them below market wages.  These workers are treated like slaves and are paid below average salaries.  For every dollar that a H-1B worker from India makes, his company will rake in twice that and take it back to India. This is a double whammy!. The wages will drop for the locals and these companies will loot and take the money to some other third world country like India. We should stop this menace. No wonder all these companies are spending millions of dollars to lobby our congress and the President. There was an article recently in the Financial Times about how Indian outsourcing companies under the guise of NASSCOM have hired professional lobbying companies in Washington to "influence" policies. Please write to your congressman and senator to strongly oppose increasing H-1B visas for cheap labor. Reply
Jan 30, 2007 1:03 AM Legal Mess Legal Mess  says:
I am on H1b (5 years). I would like to start a small business and employ a few citizens and have a plan too! <br> What are my options?? Literally zero! <br> I am like a virtual slav to my employer till I get my greencard. Get fired, pack up and leave in 14 days. <br> The wait for greencard --> indefinite (5-7 years at least with the current backlogs and quotas). <br> My qualifications -> dual degree/business certification are working against me!<br> Moral of the story: Being legal playing by the rules is for losers.....<br> Alternative: Take my business plan to Canada or some other welcoming country and give it a shot. <br> Reply
Jun 13, 2007 3:43 AM Len Inkster Len Inkster  says:
Legal Mess, by all means come to Canada. With your qualifications you should have no problems in actually meeting the requirements for entry, but don't think it's any faster up here. I have sponsored my Wife and Family from the UK. We have now bee waiting for nearly 3 years for her permanent residency, and I'm Canadian. You can get your work permit, you can start a company and employ workers, but getting long term stability is still reliant upon an overworked system. This is the disadvantage of wanting to come to a country with still very good development opportunities. The UK by contrast manages to get their permits through in a matter of months. A sign of their efficiency maybe, or a sign of the lack of due diligence in thoroughly checking out individuals coming into the country? Personally even though the wait is long, I prefer the system here in N. America. Reply
Nov 2, 2007 11:28 AM Brad Ward, Arlington, TN Brad Ward, Arlington, TN  says:
There have always been problems with the free markets when it is influenced by government subsidies to corporations like H1B visas.To explain simply what's going on, consider this thought experiment:There are two sellers, #1 &#2, and many buyers in the same market.The two sellers would like to buy their supply to make their product at a low price.The supply includes all inputs to make the product such as materials, labor, manufacturing processes, etc.Ultimately, these two sellers would like to sell their products at a high price and make a profit.Well one day, seller #1 decided that they would like to make more profit but they can't figure out how to take more market share from seller #2 to increase profits.During a meeting with management, seller #1 decides to lobby the government for more H1B visas to help them be more competitive against seller #2 because their labor rate is too high.The government agrees with seller #1 and decides to increase the H1B visa quota.Like magic, the labor rates fall as predicted because of the increase labor supply, and this makes seller #1 happy.Seller #1 can now buy their supply at a lower cost.This in turn, allows their profits to increase because they are still selling high.If seller #2 doesn't take advantage of the H1B visas or the resulting new labor rates, then their profit will be lower because they are still buying the supply at a higher price than seller #1.Therefore, seller #2 will see a decrease in profits.If seller #2 continues to be unprofitable, then they will go out of business after some period of time.Well seller #2 wants to stay in business, so they take advantage of H1B visas as well.So who wins and who loses?Since the labor rate obviously goes down, then the workers for seller #1 and #2 will take a financial loss.That's what happens when the government intervenes.The government basically allowed the sellers to profit at the expense of someone else-the workers.This may not be the intention, but it is certainly the result.Now, let's consider what happens without government intervention:There are two sellers, #1 &#2, and many buyers in the same market.The two sellers would like to buy their supply to make their product at a low price.The supply includes all inputs to make the product such as materials, labor, manufacturing processes, etc.Ultimately, these two sellers would like to sell their products at a high price and make a profit.Well one day, seller #1 decided that they would like to make more profit but they can't figure out how to take more market share from seller #2 to increase profits.During a meeting with management, seller #1 decides to lobby the government for more H1B visas to help them be more competitive against seller #2 because their labor rate is too high.The government disagrees with seller #1 and decides to not to increase the H1B visa quota.Seller #1 is not happy and goes back to management with a different strategy.This time seller #1 decides to improve their manufacturing process to be more efficient and increase productivity.Seller #1 can now buy their supply at a lower cost because they were innovative.In turn, this allows their profits to increase because they are still able to sell high or even slightly lower than before they were innovative.If seller #2 doesn't become more innovative, then his profits will be lower because he is still buying the supply at a higher price than seller #1.Therefore, seller #2 will see a decrease in profits.If seller #2 continues to be unprofitable, then they will go out of business after some period of time. Reply
Nov 2, 2007 11:28 AM Brad Ward, Arlington, TN Brad Ward, Arlington, TN  says:
Well seller #2 wants to stay in business, so they become more innovative.So who wins and who loses?Everyone wins because these two sellers are doing more with less.The results are lower supply costs and increased profits that benefit their shareholders and workers.Moreover, the buyers of their products benefit because the price of their products will ultimately decrease.We're essentially making a choice between capitalism and socialism.Should the government make rules that benefit one at the expense of another? Reply

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