Advertisement

Blog

H-1B Overhaul Increases U.S. Dependence on Skilled Foreign Workers

Many high-tech supply chain managers looking for qualified talent to fill jobs across their supply chain network will be thrilled with recently introduced immigration legislation. New guidelines triple the cap on the number of skilled foreign workers allowed in under the H-1B visa program.

While some are happy with the announcement, however, my concern is that the proposed changes don't go far enough to shorten the length of time it will take for an H-1B visa holder to become a U.S. citizen, a process that currently can take more than ten years. That said, the bill will effectively increase U.S. dependence on skilled foreign workers tasked with applying their skills toward improving American innovation and job creation.  

Dubbed the Immigration Innovation (“I-Squared”) Act of 2015, the bill is designed to attract qualified workers in the areas of Science, Technology, Engineering and Math (STEM). Introduced by Sen Orrin Hatch (R-Utah) on Jan. 13, the proposed bill raises the H-1B cap from 65,000 to 115,000, and can go as high as 195,000 in years when the need arises.  

If passed without changes it will be difficult to assess the full impact the legislation will have on wages, job opportunities for American science, technology, engineering, and mathematics (STEM) workers, and other aspects of business operations. However, the bipartisan bill is touted by several lawmakers. These legislators describe it as a measure that will attract the best and brightest workers, who will then be able to contribute to American's economic development.   

To help companies secure talent, the proposed legislation also includes measures that will uncap the existing U.S. advanced degree exemption, which currently is limited to 20,000 per year, assist families by allowing dependent spouses of H-1B visa holders to work in the U.S., and another proposal makes it easier for H-1B visa workers to change jobs.  

I would have liked to see the newly introduced legislation apply an expiration date on H-1B visas, which I think should last for three years. Before the visa expires an H-1B visa holder, who is authorized to work on a temporary basis, should be allowed to apply for a Green Card, which gives them authorization to live and work in the U.S. on a permanent basis and will speed up the day when these highly skilled workers can become U.S. citizens. Currently, H-1B visas can last as long as six years, and it is often the case that it can take more than a decade before these workers become U.S. citizens. 

Over the years the H-1B visa has garnered strong support from leaders in the high-tech sector. Companies like Cisco Systems Inc., Intel Corp., Apple Inc., and Microsoft Corp., have used the program to hire skilled workers from China, India and other nations as a way, they say, to boost their competitive advantage. For supply chain networks, STEM skills are needed to design and develop computer hardware and software, advance chip development, run computers on the factory floor, and formulate mathematical computations that go into forecasting, financial projections, and other tasks critical to supply chain planning. Furthermore, high-tech leaders say the program helps them meet the shortage of STEM skills in the U.S., the result of a failing American education system that hasn't churned out enough STEM educated workers to meet the demands of a job market that requires these skills.

According to projections from the federal government's Bureau of Labor Statistics (BLS) there will be nine million STEM related job in the U.S. by 2022. A recent BLS report entitled STEM 101: Intro to tomorrow’s jobs, also shows that one million stem jobs will be created between 2012 to 2022.

However, an examination of BLS data related to STEM job creation in occupations more closely associated with the high-tech supply chain suggests that while some occupations will see a high demand for workers, job opportunities in other areas will grow at a slower pace.

For example, between 2012 and 2022, BLS projects there will be 218,500 job openings for application software developers, 209,600 for computer systems analysts, and 196,900 for computer user support specialists.  During this decade there will also be 111,800 job openings for STEM workers looking for positions in sales, wholesale and manufacturing and technical and scientific products – many of these jobs are associated with high-tech supply chain planning across the sales and distribution network.

Other supply chain related occupations will see a lower level of job creation in the years ahead. Between 2012 and 2022 there will only be 44,100 jobs openings for electrical engineers, 43,500 openings for computer network architects and 24,100 job openings for computer hardware engineers.

With American jobs in mind, the IEEE USA lashed out at the proposed Immigration Innovation Act. In a statement the organization noted that currently more than half of the H-1B visas are used by outsourcing companies that replace American workers with low-wage foreign workers.

The statement went on to say:

The I-Squared bill would increase the number of temporary H-1B visas from 130,000 to eventually as high as 300,000 – if not more – because of various unnecessary and counterproductive proposed exemptions from the cap. Because H-1B visas last as long as six years, that represents at least an additional 1.8 million employees competing for jobs in a U.S. STEM workforce of about 5 million.

By contrast, the Consumer Electronics Association (CEA) issued a statement in support of the legislation.  “The bipartisan 'I-Squared Act' is a long overdue step toward addressing our nation's shortage of high-skilled workers,” said Gary Shapiro, president and CEO of CEA.

“Immigrants are responsible for creating one-quarter of technology startups and jobs in the U.S. It is imperative that we encourage the best and brightest from around the world to stay here, instead of pushing them to the back of the line and incentivizing them to innovate and create jobs abroad,” Shapiro went on to say.

It's difficult to gauge how this piece of legislation, if passed, will affect the high-tech job market, but I think the bill should have measures to shorten the time for H-1B visa holders to apply for U.S. citizenship. We all know that many foreign students and H-1B workers gain their education and experience in America, but often return to their countries taking their knowledge and expertise elsewhere.

Whatever we can to do stop that trend is worth the effort because building human capital translates to strengthening economic development and social stability. My hope is that lawmakers can craft legislation that will create an environment where skilled 

H-1B visa holders can work alongside their U.S. counterparts to advance technological innovation, increase job creation, and do all of this while shortening the time for these workers to become officially Americans.

8 comments on “H-1B Overhaul Increases U.S. Dependence on Skilled Foreign Workers

  1. luvlingo@gmail.com
    February 16, 2015

    H-1b is mostly used by Offshore Outsourcing companies to remove jobs from the United States.

    The reason why we run out of Random Access H-1b visas each year, is because Offshore Outsourcing companies stuff in an excess number of H-1b visa requests, in order to game the system.

    The reason that an Offshore Outsourcing company can do this, is not because they have an excess number of talented people and innovation jobs available in the U.S.  They can do this because they have an over-supply of just average talent and many-many positions in the U.S. that amount to little more than on the job training positions.

    And the typical trainer for those jobs, is the person that is being replaced by a lower-paid H-1b workers. (and we know this from LCA data in the Molina Healthcare case). 

    Any increase in the number of H-1b visas will simply be taken up by the Offshore Outsourcing companies.  This was true in the past decade, true during the Great Recession, true now, and will be the case in the future.  Because getting Americans to train their H-1b replacement and then moving the entire department overseas is extremely profitable.

    Offshore Outsourcing companies do not hire Americans for jobs on U.S. soil.  Southern California Edison had a capable IT crew of 500.  All of this crew were replaced by people coming in on an H-1b from Tata and InfoSys, and being trained by the person they were replacing.  Ironically a spokeman for Tata, Benjamin Trounsen, is quoted as saying that Tata actually has a hard time find qualified U.S. citizens.  A statement which flies in the face of all the evidence.  Well Ben I suggest you take a look at the people being replaced by trainees at Southern California Edison.

    The reason why legitamite business are deprived of H-1b visas, is because of the over subscription by Offshore Outsourcing companies.  The I-Squared bill would compound that madness, because it does not address the over subscription by Offshore Outsourcing companies.

    Offshore Outsourcing companies are not legitamite, they are violating U.S. immigration law, which states that american workers must not be distressed by immigration policy.  Clearly American IT workers are being distressed by U.S. immigration policy, right now at Southern California Edison, but the Obama administration is doing nothing.  The Obama administration is not enforcing the actuall law, the result is thousands of unemployed U.S. Stem workers.

    In addition to this travesty, hundreds of H-1b visas were diverted by InfoSys and Tata for this job-destruction at Southern California Edison.  H-1bs that could have been used by start-ups to create jobs, but were instead used to destroy jobs in the United States.  And that is completely insane!

    If you are small business, that actually tries to hire local, but can't.  The I-Squared bill will not help you.  The Offshore Outsourcing companies will be taking up all the H-1b visas, as they did last year and in the last decade.

    What American business needs is to give priority for H-1b access to companies that can actually attest, under penalty of perjury, that they are actually trying to hire Americans.  The Offshore Outsourcing companies can't do this, and they know it, so expect a fight on Capitol Hill over it, but that is the only way.  And recent History proves it.

  2. The Source
    February 17, 2015

    I've added a link to an article that exposes the way that tech hiring firms use the H-1B visa program to exploit skilled foreign workers. The story was originally published by The Center for Investigative Reporting. Here's the link:   

    http://bit.ly/1CErTjY

    This is a sad situation that should be addressed by lawmakers. Having said that, though, the upside is that many talented foreign-born STEM workers have been hired through the H-1B visa program, and these skilled workers have made an enormous contribution to the U.S. tech sector.

    To the owner of e-mail address , thanks for your response to this story. 

  3. ankkith
    April 1, 2015

    nice post

  4. Hailey Lynne McKeefry
    April 2, 2015

    @luvlingo, thanks for weighing in. It is certainly a complicated matter. What do you think needs to happen to turn this around?

  5. hapless_indian
    July 14, 2015

    After having read the post and the comment, i can't help but think that the comment is actually right. I just want to provide a perspective from the eyes of an Indian.

    I've done my masters in electrical engineering from US and returned back 10 years back when there was a huge ruckus about how there'll be a reverse brain drain and more R&D will be there in India which'll usher in a new era of india as a world power.

    10 years later, i can't wonder at the hapless situation india is in, with no R&D, no products, no new ideas and nothing to show for, except a few IT skills which anybody with enough common sense can pick up. Only service industry is there with people crunching in mindless code for some requirement specifications which are written by some person in US. It seems like the real brains behind the entire process and the control lies with the US instead of a shift in control which i expected and which was predicted 2 decades back by the entire world. 

    Even Japan when they started off by selling boxy cars in US, took cues from US automobile manufacturers and started churning out on-par or better vehicles when compared to Ford, GM et al. Ditto with Sony, panasonic in electronic industry. Other countries like south korea has followed suit with Hyundai, Samsung and LG. I see a earlier fast and furious movie where Hyundai is mocked at and even before the sequels are over, they are on par with toyota & honda.

    Lets come to the US economy now. FYI, GM & Ford's presence in India is also there and along with japanese, korean, french and russian automotive manufacturers. they've bulldozed local competition from hapless Indian automotive industry who are not investing on technical innovations. Only recently they are catching up, you know how ? By hiring foreign talent to do their designs for them with only manufacturing plants here.

    The way i see it, the money made by IT professionals in India is being sent back to the US by means of US and other countries dumping their products in the name of modernization in India. India is not getting modernized, it is becoming the consumer of products from all over the world. It doesn't seem to have solid foundation in any sector, be it economy, science or engineering or whatever sector you can think about. When Michio Kaku said that H1B is making a difference in American Industry, he wasn't kidding. Directly or indirectly, US is gaining from shipping jobs to india or hiring talent by H1B.

    When I look at the semiconductor industry, as usual, there was a lot of noise from US about how japanese and chinese are taking away the jobs from US. But, despite all that, Intel & AMD are the only leading CPU making companies and the closest competitor in CPUs is ARM, but that too only for mobiles. If i look at the revenue difference between Intel and ARM, it is appalling to say the least, with Intel having assets worth atleast 100 times that of ARM. It might be more, but i'm not too sure.

    IT industry : Yahoo, Hotmail and other sites are not facing competition from foreign. They are facing competition from google, which, once again, is indigenous to US. Ditto with oracle and other companies. Can you name any homegrown software from India which is being used all over the world ? 

    After all this tirade, all i can say is, I also detest the fact that there is an increase in H1B visas and there is only going to be more of brain drain from india. 

    For US, your real competition is going to come from China, where the PhD candidates are encouraged to go to US to study and asked to come back to invest the acquired knowledge in China. How I wish India had a forethought like that !?!?!?!

    FYI : When i was studying MS there, i had an american researcher who was the go-to-guy of all the foreign students. Since the time i came back 10 years ago, i see that he has grown in stature in his chosen profession and is leading a research team with loads of research funding and here I'm wondering why i came back to India at all, since I've not made any difference here by coming back, because my knowledge is not required/utilized. 

     

  6. Hailey Lynne McKeefry
    July 14, 2015

    Thank you for sharing your thoughts and experience. i'm wondering whether you think that India's Make in India wil have discernable benefit to the country? It seems like some semiconductor manufacturing has been started with the effort (Make in India Taking Vision to Reality for Indian Semiconductor Manufacturing )

  7. hapless_indian
    July 19, 2015

    Being an active contributor or a leader in any sector will/should make a difference to that country, right ? Taiwan, with its tiny population/resources is 19 or 20th largest capitalist nation interms of GDP. Without thriving semiconductor sector is this possible at all ?

    And regarding the semicon industry, intel was supposed to have setup a fab in Hydrebad sometime in 2006. Yet to see the lights of that.

     

  8. Ashu001
    August 11, 2015

    Hapless,

    I want to thank you for your comments and sharing your basic frustrations with the EBN Community.

    Since we are a Global community and dealing with a most critical issue of Global Supply chains here your Comments are most helpful to Supply Chain Pros to understand the intricacies of this rapidly changing space.

    What I have learnt from my time dealing with an International Workforce here in America is that different Nationalities have different quirks and different ways of doing things.

    For instance ,whenever I deal with Chinese Pros they tend to be extremely driven,hard-working and super-focussed and Determined on achieving their objective(above all else).They are also extremely confident in their own abilities and talk less and work harder.You will always get a response from a Chinese Pro for a work-related query even on Saturday night at 11PM.

    When I deal with Indian Pros they tend to be extremely Intelligent,Sharp and always on the Look-out for Short-cuts or the fastest/easiest way of doing things.Nothing wrong in that approach also but it may not always be the best way to solve a problem.Here they also seem to be low on self-confidence and need constant support/Goading/encouragement to keep working.Consequently,the folks with low-esteem tend to talk more and work less.

    Trying to get them to work on Weekends is a Mixed Bag-Some Do very easily;Some Don't.

    When I deal with Hispanic Pros they usually tend to be a Mixed Bag;Some very Good some not so.But they are'nt always
    the most industrious of the Lot.And when its Soccer Season on?Its impossible to get them to focus on anything else….LOL!!!

    When I deal with the American Pros they tend to be focussed on the job during the work-week but the moment its Friday 6PM;they are totally unavailable for anything till Monday Morning 9AM.

    However,Its close to impossible to get them to answer a Phone Call or Email during the Weekend especially for Emergencies (unless their job profiles clearly stated such) and most are generally unavailable on Weekends.

    Anyways,these cases are Generalizations which I have come across in my work and need not be true for all cases Globally.

    So coming back to Chinese Pros vs Indian Pros.

    One important difference I have noticed is Chinese Pros are much more Self-confident (they let them work do the talking) while Indian Pros need to talk a lot especially to cover for their low sense of self-esteem.
    Why is that the case?

    Could it be that with the One-child Policy in china,one kid gets showered and pampered and encouraged by 3(sometimes 4 Generations) excessively while Indian kids are usually not only children so
    their self-esteem may not be built up to the same level as Chinese kids?

    I don't know but thats for you(as an Indian to answer).

    Why did I bring about the lack of self-esteem issue in India here?

    Maybe,India did'nt have the Infrastructure(or a supportive Environment in place) previously but that's starting to change(and decisively now).

    On EBNs own Twitter feed I recently came across three major Annoucements which clearly show that India is definitely
    starting to look up as a Centre for Manufacturing Globally.

    1)Foxconn the Contract Manufacturer for Apple,RIM ,Motorola and many others plans a $6 Billion Mobile Manufacturing
    facility in India

    2)Xioami (China's largest Phone Manufacturer) plans a $1 Billion Mobile Manufacturing facility in India

    3)Ford Motors is all set to make India the Export Hub for its Small Cars and Small SUVs(this comes after Hyundai,Renault
    &Suzuki already have done so).

    4)India's Home-grown Mobile Manufacturer -Micromax is the Largest Selling Brand of Mobile Phones in India today(surprassing
    such world-renowned Names like Samsung and Apple in the Process).

    5)World Renowned Food Manufacturers like Mars Inc and Ferrero Rocher have made India their Export Hubs for the Asia-Pacific region.

    Are you trying to tell me that all these Mega-conglomerates have no clue what they are doing in India?

    If Foxconn were to announce such a Large Investment in America,Believe me all 52 states would start a Bidding war to ensure that Manufacturing Facility landed up in their State(with
    the possible exception of California and Illinois but that's a totally different story).

    Is Micromax the No.1 Company in India only because their Phones are the cheapest?[When Microsoft decided to give away their Mobile OS for free,the first
    company they chose Globally for entry-level phones was Micromax;it was a similar Story when Google decided to launch its cut-price Android One range of Phones].

    Obviously,the initial attraction came because India is the only Large Growing market today.

    But beyond that the talent pool and conducive Atmosphere for these Manufacturer's matters immensely.

    The Foxconn case story is most interesting.It seems that the State/Province where Foxconn decided to establish their
    Facility did'nt have a Good Enough Airport(with Export facilities) nearby.

    So guess what they did?

    They have contributed 200 million Dollars(from their own pockets) to upgrade the existing Airport to make it capable for Exports!
    And the Governor/Prime Minister of that Province went out of his way to make it happen!

    Obviously,when you are starting something from scratch to expect everything to happen overnight does'nt happen.

    You have to build scale slowly-slowly.The great thing about India is that's precisely what's happening now.

    Since you are an Indian-I will just say this much-Believe in It! And Make it Happen!

    All the Best!

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.