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Tide Turns for H-1B Visas

A decade ago, the high-tech industry was clamoring for a higher cap on H-1B visas — a specialty visa that allows high-skilled foreign workers to hold jobs in the US. Currently, the US can allow 65,000 foreign workers to reside and work in the US for up to six years. The tech industry used to think that number was too low, and almost annually would lobby to increase the cap.

This year, as of April 1 — the date the US begins to accept petitions for the fiscal year beginning October 1, 2012 — only 8,000 workers applied for H-1Bs, according to US Citizenship and Immigration Services (USCIS) statistics cited by the The Wall Street Journal. That compares with 16,500 petitions in April 2010 and about 45,000 in April 2009, according to USCIS.

In 2008 and 2009, the 65,000 quota was filled within days, according to the WSJ.

The lack of interest in H-1Bs is surprising, even if tech jobs in the US are hard to come by. H-1Bs are set aside for jobs that can't be filled by a US applicant, and the application process is rigorous. Theoretically, these jobs seek the best of the best and have vigorously been defended by the tech industry whenever efforts to reduce the cap arise.

The WSJ article goes on to analyze some of the reasons behind the trend:

    Several factors have contributed to the decline in H-1B visas, including the lackluster pace of the U.S. recovery, more opportunities for skilled workers in their home nations and higher visa fees, which appear to have spurred Indian companies operating in the U.S. to seek fewer visas. Attacks on the program by congressional foes of U.S. immigration policies have also cast a shadow over it.

Ouch.

H-1Bs have always been a hot button in high-tech. Proponents argue they are good for the industry because they bring specialty skills into the US. Opponents argue they displace US workers that need jobs. But if foreign workers are content to stay put, there's a bigger issue at hand.

The electronics industry is playing on a global stage, and the competition for talent is now worldwide. The tech industry is still a growth industry — recent financial results have been strong, demand for electronics continues to be high, and companies are hiring overseas. So the issue doesn't seem to be with high-tech — it's high-tech jobs in the US. If the US is no longer attractive to talented professionals, the problem is policy, not industry. And policy is no longer working for high-tech.

31 comments on “Tide Turns for H-1B Visas

  1. jake_leone
    May 10, 2011

    Profits are way up for computer software and hardware industries. Enough so that companies like Oracle, Intel could easily increase their work forces by 10-20%. 

    Hey Google is?  Oracle and Intel are resting on their acquisitions and arses.

    These companies are not hiring because they are not facing competition.

    Competition (not profits) drives the hiring in companies that are already profitable.

    There's nothing wrong with people returning back to their home countries and starting competitive businesses.  Hey I worked for a Japanese company for 7 years early in my career, that company chose to compete directly with several U.S. and other Japanese companies, so they hired (they hired in England, U.S. and Japan) to support our division, and hired aggressively.

    Before that I worked a software job that only existed because competitors were offering a similar product.

    I say let them go back and compete with us, when they do our companies will see the competition and realize they need to hire in order to match competition.

    Enterprize software and Microchip production is not a cut-throat business for the established players, indeed these companies are making billions but not hiring.

    The myth the high-tech industry is touting now is that if we let people return to their home countries, they will help our competition, well do it.  Software and Chip Design are labor intensive businesses, and competition will drive hiring.

  2. Ariella
    May 10, 2011

    People in the US on an H1B Visa can end up in a less than enviable position. When their contracts come to an end, they have to find someone else to pick up the sponsorship, or they must leave the country. A loss of a job is difficult for anyone, but when you're right to remain where you are goes with it, the consequences are far more serious.

  3. eemom
    May 10, 2011

    This trend is very scary.  It means that foreign workers no longer believe that the US is the place to be to find good jobs with a future. We are shipping jobs oversees, building design centers elsewhere, why would foreign workers want to come here when some of those jobs are being shipped overseas?  There is less opportunity to choose from and no guarantee that there talents will aid in them staying in the country long term. 

    Perhaps the silver lining is that companies can look at their policies and see how to put the US back on top.  Also, maybe there will be more jobs available for US residents.

  4. Anand
    May 10, 2011

    Reverse brain drain can be attributed to various factors. Uncertain employment condition in US,  great career opportunities back home, strict US immigration policies that block high skilled immigrants from becoming permanent American residents are couple of the major reasons which are resulting in this trend.

  5. Barbara Jorgensen
    May 10, 2011

    Hi Jake, thanks for your perspective. That is a point I hadn't thought of. And I agree–returning home is a benefit to that locale no matter where the initial experience takes place.

  6. Ashu001
    May 10, 2011

    Jake,

    You seem quite angry at the Tech Majors for the way they do business.I understand.

    However,its important that you realise it was never the Tech Majors that picked up most of the H-1B Visas.More specifically it was the Indian Outsourcing/Consulting Majors which picked up most of the H-1B Visas.

    Now thanks to the fact that Visa Costs have risen by close to four-fold,its become prohibitively expensive for them to send specialised Skilled Labor from India to the US for Software Jobs.Rather as a way to save costs(as well as an excellent PR Excercise) they are now hiring more and more Developers in the US.Which is great so that it helps reduce the unemployment situation we have here.

    Only problem,if you have been to University recently-Most Software/Engineering classes in America are filled with Foriegn Nationals(Non-US Citizens);and if they can't find jobs in the US,they are going to go back to their Home countries/other countries which are more open/welcome to accepting Skilled immigrants(Australia/Canada/UK/Singapore come to mind straightaway).

    Regards

    Ashish.

  7. elctrnx_lyf
    May 10, 2011

    It is true that there are many companies in USA which are merley staffing companies have been doing lot of illegal documentation to bring in the engineers to USA. But now after the US government continuosly auditing and have taken a strict action against these fradulent organizations. This has severly brought down the number of techies that can enter into USA. Genuinely it is not easy to get an H1B visa even if you are a skilled engineer and I do not think this is a problems for the students pursuing higher education in USA.

  8. AnalyzeThis
    May 10, 2011

    I would also argue that telecommuting is far more accepted and common now, so why bring someone into the country when they can stay where they are and work from their native country… at a lower wage? Also, there's less commitment, no visas to deal with, etc.

    So I think it's a combination of foreign workers wanting to stay put and US employers utilizing more remote workers. It's easier to work remotely now than ever before and especially in tech, the physical location of an employee matters less. As demonstrated by the amount of outsourcing we've seen in general.

  9. Ashu001
    May 10, 2011

    Barbara,

    I can tell you for a fact most Indian Software Engineers no longer want to go to the US on H-1Bs;for the simple reason that it takes forever to get a Green Card/ become a US Citizen.

    Today the American Dream/lifestyle is possible anywhere in the World.This is something which those clowns sitting in DC have'nt yet figured out.Today Brains go where they are respected and looked after best.And that need not always be in America.

    The other aspect is that there are'nt that many American citizens studying these courses at University anyways today.

    This is another trend which needs to change and change fast;if we are to maintain a succesful edge as a Technological Superpower.

    Regards

    Ashish.

  10. jake_leone
    May 10, 2011

    Ashish,

    I think what will happen is that the as the head-hunters are driven out of the get a visa and bench the worker program (because the costs have been raised).  The pool of available tech workers in other countries will rise.

    This should encourage software entrepenuers in India, China to start designing their own products that can compete with the Oracle's and Intel's of the world.

    After all, realistically, you cannot possible expect U.S. visa programs, no matter how generous to stop this competition.

    Workers in the United States are not benefiting from competition with lower cost labor in the China and India.  Indeed it is actually a bad situation for everybody, except the CEO's and Execs who are raking in the bonuses.

    Oracle is a classic example of a company that bought all of its competition.  Oracle is basically a monopoly now, and has no interest in growing head count, yet is raking in billions.  Oracle is actively pruning the workers from Sun Microsystems as well as from the other acquisition over the last 10 years.

    Nothing would do more to spur Oracle to hire, than an Indian or Chinese company coming out with some competition.  That company could grow huge in this market, and take some of the those billions that Oracle is making every year.  Oracle would have to respond by increasing it offering to the customers.  It is likely that the increase would have to be in the quality of its offering, so that it can keep up its current price structure.

    A famous entrepenuer once referred to the syndrome that India and China seem to be in as “Pay-Check-Itis”, an affliction where workers (or would-be entrepenuers) get addicted to that Pay Check, and just can't see the bigger opportunities.

     

     

     

  11. dave_94302
    May 10, 2011

    The purpose of the H1-B visa program is to import half-priced slave labor and to them lay off the American workers.

    The reason why we are seeing reduced demand for H1-B visas is that employers are getting very unpleasant pushback from their employees.  Everybody knows that if a company hires even one H1-B worker, then they are planning to lay off all of the Americans.  The bad comments now start immediately.

    Make no mistake about it, H1-B is a threat to the existence of the high-tech work force in this country.

     

    -Dave Chapman, BSCS, MSEE

     Palo Alto, California

     Candiate for Congress (Republican)

  12. Ms. Daisy
    May 10, 2011

    Ashish:

    You are right on the points about respect and the feeling of belonging by foreign workers that seek to work in the US. First, we moved manufacturing overseas so high-tech jobs in the US went on the decline. Then we made hostile policies and high prices for getting the H1B visas (not forgeting the high priced immigration attorneys that cookie cut applications).

    H1B visa application decline is just a symptom of a greater ill that is affeccting the USA. The American dream is now the global dream. The best brains are being tapped globally, and given the comforts (housing, cars and drivers), respect, and other benefits offered to high-tech personnel in developing  economies and countries that are globally competing for the high-tech pie.

    More and more experts are leaving the US for these places where they are valued, whille the politicians here are bickering over reducing “aliens” in the country. Yes, you are also right on the American child. many are now being convinced that college education is not necessary and using bill Gates as an example. I wonder if they checked that we have only a handful of such success stories.

    With the high demand for electronics continuing and developing economies like China and India are training large numbers of science graduates as well as tech savvy kids, the US will definitely be outperfomed and kicked to the curb technologically. The few Americans that are smart will actually be seeking jobs overseas.

  13. Jay_Bond
    May 11, 2011

    There are many problems with the current situation. For starters many of these qualified applicants aren't coming to the U.S. because they can get decent tech jobs in their current countries or fairly close. There are many U.S. based companies that have offices and plants worldwide now and don't have the need to bring these workers stateside.

    On another note the current policies being brought forth are trying to eliminate foreigners from taking American jobs. Whatever happened to the best qualified gets the job? Everybody is so concerned with the economy and unemployment, yet they won't take a pay cut to keep their job or replace a job lost to unemployment. They would rather collect the benefits and complain that other people are taking their jobs. Times change and that means adjustments need to be made.

    Without the help of foreigners, many inventions and discoveries that we take for granted would never have taken place.

     

  14. Barbara Jorgensen
    May 11, 2011

    I am so grateful for the perspective our readers are sharing on this topic. Personally, I have always believed in 'best person for the job' and H1B enables that to be fulfilled. Our industry would be much poorer if it weren't for the contributions of non-US residents. Competition is what our industry is all about and that should include hiring practices. No doubt there are companies and people that take advantage of the program and that happens everywhere. But to blanket the program as “slave labor” and divide the workforce into US vs. non-US residents does an injustice to the hard working people who have contributed to the advancement of the high-tech industry.

  15. jake_leone
    May 11, 2011

    Sadly, H-1b has been used to exclude U.S. citizens from the workforce and to bring in engineers whose sole purpose was to remove whole departments. Unfortunately the H-1b law has no protection for U.S. workers, an H-1b may be hired even if a better qualified U.S. citizen applied, interviewed, and wants the job. The fact that there is no protection for U.S. workers to be able to compete equally, has made the H-1b visa the “Outsourcing” visa, as it is officially described back in India.  
     
    Abuse of other visa's is also quite common, that is why Infosys tried to coerce a U.S. employee into falsifying federal documents in order facilitate the illegal acquisition of B-1 visas for Infosys Indian employees. The B-1 visa is not supposed to be used by people coming here to actually work on a job, yet that is exactly how Infosys is using these visas.  
     
    Have you heard about the 300 billion dollars in tax cheating that goes on each year? Infosys is right there, because under B-1 they don't have to pay U.S. taxes for the workers they bring in to take your job.  
     
    Look we cannot afford to have a Visa system that facilitates the removal of jobs. And U.S. workers must be allowed to compete equally for jobs on U.S. soil.  
     
    Infosys uses the Visa system to find it's U.S. engineering workforce, they actively discriminate against U.S. engineers in their hiring practices, and are using the visa system to create a U.S. engineering workforce that is 90% from India. Because their sole purpose is to use U.S. visas to cheat on their taxes and remove U.S.jobs.  
     
    Sadly companies such as Infosys, which actively discriminates against U.S. citizens, have badly abused the U.S. visa system, to the point that it is a National Disgrace.

  16. jake_leone
    May 11, 2011

    Let me make this clear:

    Tech companies hire because when they are in a state of competition.  When they are not in a state of competition, they don't have any reason to.

    So these workers going back to their home land, and potentially starting competitive business, is better than if they stay here and compete for scarce tech-jobs.

    Competition between businesses forces innovation, on the other hand, competition between workers is also known as “Unemployment”.

     

  17. dave_94302
    May 11, 2011

    The history of the H1-B program is filled with lies and misinformation.  For example:

     

    H-1Bs are set aside for jobs that can't be filled by a US applicant, and the application process is rigorous. . . .these jobs seek the best of the best

     

    None of this is true.  There is absolutely no requirement for an employer to make any effort to hire American citizens before importing H1-Bs.  The application process is a total rubber-stamp.  Despite obvious violations of the “prevailing wage” law, over 80% of all H1-B visa applications are approved.  H1-Bs are not remotely the”best of the best”, as anyone who has actually worked with them can tell you.  Their major qualification is that they are willing to work for cheap.

    If we are going to have a reasoned national debate on immigration, we cannot tolerate ignorant people who repeat corporate propaganda.  Here's the truth:

     

    H1-B is the largest immigration fraud in American history.

     

    The H1-B files are public record.  I have a complete set going back to 2001 in MySQL format.  Everybody who has gone through the data has come to the same conclusion:  H1-B workers are being paid much less then American workers.  Usually, people come up with estimates between 30% and 40% below “comparable wage”.

    This represents a $20 Billion per year direct savings in corporate payrolls.  That is why the Washington lobbying firms pay fake academics to publish fake studies about the labor market, and that is why they pay Public Relations Specialists to lie to you.

    -Dave Chapman

     

     

  18. BobWatson99
    May 12, 2011

    It is really unfair that I can't hire 'the best' for my business.  I am not allowed to bring in the 'best for the job' from across the globe. There is an shortage of workers and I want to hire the 'best' person for the job.  Why can't I bring in visa workers for super cheap like the tech companies can?  Crony capitialism at it's worst my friends.  I should be allowed to hire the 'best and brightest' manual workers.  So I assume you will all support me in my quest to hire the 'best'?

  19. Ashu001
    May 12, 2011

    Miss Daisy,

    A Nice and accurate portrayal of the current state of things in The Tech space in America.

    However,I would'nt be so soon to count America out(as you say when you believe all American techies should start looking for jobs overseas).

    Instead I would rather suggest Americans leverage their existing strengths(especially Great infrastructure) to the hilt).

    It takes a long,long time for a super-power to decline(after the decline has noticeably set in).Also,its not an irreversible process.With the right set of policies in place America can shoot right back way-way ahead of the rest of the competition.

    Regards

    Ashish.

  20. Ashu001
    May 12, 2011

    Leone,

    A lot of people have a massive bond to pick with Oracle.

    But whatever they are doing (good or bad is immaterial)is perfectly legal and within the bounds of Global Competition authorities.

    However,I do agree that Competition is the best and only way to foster lasting employment for everybody(including for Techies).

    Regards

    Ashish.

  21. SP
    May 12, 2011

    I guess people are loosing interest to go and stay in US or any western countries when they can get eually good oppurtunity back home. The cost of living is really high in US and no matter how much you earn the savings at the end of day is minimal. I can say from my pwn experience, as a family we have returned back and many I know are coming back. But due to infrastructure I feel US is one of the best places to live especially CA.

  22. Barbara Jorgensen
    May 12, 2011

    It seems to me that some of the critics of the H!B visa program should be aiming their criticism at the companies that abuse the regulations rather than at the program itself. US corporations are supposed to provide due diligence that they have searched for qualified applicants before requesting an H1B application. If the following is true:

    “The application process is a total rubber-stamp.  Despite obvious violations of the “prevailing wage” law, over 80% of all H1-B visa applications are approved.  H1-Bs are not remotely the”best of the best”, as anyone who has actually worked with them can tell you.  Their major qualification is that they are willing to work for cheap.”

    The abuse originates within the companies hiring the workers. I'm sure that the data on H1B applications is widely available–as a government agency, Immigration should provide that information. But public and private companies are not held to the same standard.

    I agree on this point, though: if the applicants are an automatic rubber stamp–which in my experience is not the case–the abuse goes beyond the employers. 

  23. Ms. Daisy
    May 12, 2011

    Ashish:

    “It takes a long,long time for a super-power to decline(after the decline has noticeably set in).Also,its not an irreversible process.With the right set of policies in place America can shoot right back way-way ahead of the rest of the competition.”

    Thanks, I do appreciate your sentiments and patrotism! I am deeply concerned for the continued decline in the American education, divisive partisan politics and deep division of the populace. I agree that maybe not all techies will go looking for jobs overseas, but will the jobs still remain here?

    The decline of US as a superpower has been on going for many years now. It was a slow decline at first, but it kicked up speed at the end of the 90's and those who were to put in policies did not understand what was going on neither did they listen to those who knew.

    Even now, we are still debating trivial things and not gutsy enough to make bold strategic decisions. We spend reasonable time on the birth certificate of the president and listen to empty heads like Palin. The dream of shooting back ahead I believe starts with re-organization of our priorities and taking the time to have meaningful debates towards developing and implementing appropriate policies.

  24. dave_94302
    May 12, 2011

     

    “It seems to me that some of the critics of the H1B visa program should be aiming their criticism at the companies that abuse the regulations rather than at the program itself.”

     

    I do not agree.

     

    It seems to me that when you are confronted with an organized system of immigration fraud which has already cost 900,000 Americans their jobs, then there is LOTS of blame to go around.  I blame the following people:

     

    1. The employers, whose desire for cheap, compliant workers is the root of the problem.

    2. The jobs shops, whose willingness to commit fraud on behalf of those corporations which did not want to get their hands dirty by actually filling out the H1-B paperwork makes them guilty of obstruction of justice, in addition to immigration fraud.

    3. The news media, whose uncritical repeating of idiotic phrases like “the best and the brightest” and “shortage of computer engineers” has polluted the public discussions of this matter.

    4. Anna Eshoo, Zoe Lofgren, and Dianne Feinstein, who sponsored the H1-B legislation in 1999 and 2000.

    5. Bill Clinton, who signed it.

    6. The other politicians who voted for it.

    7. The lobbyists who gave bribes (I mean campaign contributions ) to the above persons.

    8. Organizations like the IEEE, who allowed political correctness and their foreign members to prevent any meaningful discussion of H1-B, even as thousand of American IEEE members were expelled from their careers.

    9. Various academics, who allowed their names to be attached to phony papers asserting that there is a “STEM shortage” or a “PhD shortage”, even as recent college graduates in Computer Science are flipping burgers or working at Wal-Mart.

     

    There is plenty of blame to go around, and I do not think that anybody should be given a pass.

     

    I want 1% law enforcement:  Since 900,000 Americans have lost their jobs because of H1-B fraud, I want 9000 Americans to go to jail, and I do not want them to be allowed to hire some Indian to go to jail instead.

    Apparently, a lot of people agree with me.  I won the Republican primary when I ran for Congress last time (14th California:  Silicon Valley North).

    If I get into Congress next time, may God have mercy on the H1-B advocates, because I shall show them none.

     

    -Dave Chapman

     

     

     

     

     

     

     

  25. Barbara Jorgensen
    May 12, 2011

    Hi Dave,

    Has there been a prosecution or investigation of H-1B abuses? I'm genuinely curious. Are the consequences deportation for the employee, or the company that hires them?

  26. dave_94302
    May 13, 2011

    There have been approximately 100 proceedings against employers for H1-B violations (including fraud) prior to January, 2009.  The vast majority of these were conducted under the kangaroo court called the “Department of Labor Administrative Law Judge” system.  I saw a spreadsheet from the DOJ (US Department of Justice) which said that 18 or so companies had been “sanctioned”, and that the most common sanction was a fine of around $700 and having the company involved banned from the H1-B visa program for a period of time.

    This is obviously a joke, for the following reasons:

    1.  If you are saving $40,000 per year by hiring an H1-B worker, then $700 is not remotely a deterrent.  It is a parking ticket.

    2.  If your company is banned from importing H1-Bs, you simply set up another company with a different name, and you're back in business, with a clean slate.

     

    Given the nature of the “enforcement system” that the Department of Labor has set up, they must either be incredibly stupid or on the take.  I believe that they have accepted bribes in exchange for non-enforcement of the H1-B rules.  (I also do not expect them to sue me for saying such a thing, because of two words:  Discovery Proceedings.  If you guys sue me, then my team of highly talented hackers will be rummaging through your e-mails and you will be legally prohibited from stopping them.  Do you feel lucky?)

    Since the elections of 2008, the combination of high unemployment and the increasing willingness of the anti-H1B movement to apply whatever political pressure is required has caused some of the more extreme cases of fraud to be prosecuted by actual Federal Prosecutors.  To date, a couple of dozen people have spent a little bit of time in jail.  In most cases, they were able to make bail the same day.

    I would characterize this as “teeny, tiny steps in the right direction.”

     

    My attitude is as follows:

    Anybody who is in favor of H1-B is an enemy of the United States.

    Anybody who is in favor of H1-B is an enemy of the American people.

    Anybody who is in favor of H1-B is an enemy of me.

     

    I want the H1-B employers to go to jail, and I want the executives of the jobs shops to spend the rest of their lives in Guantanamo, along with the other enemies of this country.

     

    Finally, I would like to remind everybody reading this that I was the winner of the Republican primary election for US Congress in PALO ALTO.  There are a lot of people in Silicon Valley who agree with me.

     

    -Dave Chapman

     

    p.s.  The only case of an H1-B actually being deported that I know of involved an H1-B in Southern California who murdered his girlfriend.  I am unaware of any cases where an H1-B was deported for being unemployed.

     

  27. Ashu001
    May 15, 2011

    Miss Daisy,

    Agree entirely!!!

    Especially with your last sentence here,

    “The dream of shooting back ahead I believe starts with re-organization of our priorities and taking the time to have meaningful debates towards developing and implementing appropriate policies.”

    Infusing a bit more positivity into the proceedings won't harm anybody,would it?

    Regards

    Ashish.

  28. Kunmi
    May 18, 2011

    Dave, I think the issue with H-1B visas lies n the companies that brought in the employees under this visa. If I may be right, they are responsible to comply with all applicable laws and regulations aand if they fail, they should be brought to justice. As long as the provision of law allows H-1B visa, there is no fight about it but the watchdogs should do their jobs as stipulated in the guidlines.

  29. elctrnx_lyf
    May 20, 2011

    In my opinion H1B Visa are never utilized properly by the companies. Mainly IT comapanies in USA have only tried to recruit low cost work force using this. It would have been utilized well only if the H1 VISA's are provided to only few US comapnies in different sectors like engineering, IT and Banking to recruit the full time employees. This would have helped to keep it transparent to both the candidates and the companies.

  30. elctrnx_lyf
    May 20, 2011

    In my opinion H1B Visa are never utilized properly by the companies. Mainly IT comapanies in USA have only tried to recruit low cost work force using this. It would have been utilized well only if the H1 VISA's are provided to only few US comapnies in different sectors like engineering, IT and Banking to recruit the full time employees. This would have helped to keep it transparent to both the candidates and the companies.

  31. mario8a
    May 22, 2011

    Hi Barbara

    this is a great Arcticle, my company sponsored the H1-B / L1-B  Visa for me back in 2001, due to lack of expertise of the lawyer, the time expired and I was hire back in the manufactuing site, I had a great time living in the US, but there's no place like home.

    H1-B, L1-B, TN —- the US goverment should bouble the Qty offered, if the local Engineers are not willing to step up for high tech open positions.

    Regards

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