
How the H-1B Visa System Can Hurt American Workers (2015) - howard941
https://www.nytimes.com/interactive/2015/11/06/us/11visa-listy.html
======
paulsutter
Significant changes since this article was published:

[https://www.cnbc.com/2018/04/20/big-american-tech-
companies-...](https://www.cnbc.com/2018/04/20/big-american-tech-companies-
are-snapping-up-h1-b-visas.html)

> Four U.S. tech companies — Amazon, Microsoft, Intel and Google — were among
> the top 10 employers for approved H-1B applications in FY 2017,

> The top seven Indian technology companies were given a total of 8,468 H-1B
> visas in FY 2017 .. a massive drop from FY 2015, when these companies got
> 14,792 H-1B visas. One of the largest Indian outsourcing firms, Infosys, saw
> a 49 percent drop between FY 2016 and FY 2017.

~~~
jgalt212
Amen to that. The labor pool must not be artificially expanded when we have
had no real income growth in a generation.

Free and Fair Trade and assisting the American worker are the only things
Trump is good for. The rest has been a disaster. But if Hilary were in charge,
we´d still have unfettered globalization no empathy for the disenfranchised
deplorables. Let´s just keep pumping them full of opiods.

[https://freebeacon.com/issues/hillary-clintons-
prescription-...](https://freebeacon.com/issues/hillary-clintons-prescription-
pill-problem-oxycontin-inventor-clinton-foundation-donor/)

~~~
int_19h
> The labor pool must not be artificially expanded

It's the other way around - visas and borders artificially limit it.

You can argue whether it's a good thing or not, just understand that you're
basically demanding more regulation. Rather ironic, coming from "J. Galt".

~~~
jgalt212
I see your point, but certain companies hogging the lion's share of the H1-B's
is not _Free Enterprise_.

------
Bucephalus355
H1-B employees and American Workers have both been abused by corporations in
the US.

I have seen this first hand how many people trying to get a junior software
development job with decent background experience get the “ladder of
opportunity” shoved down the second they try to approach it.

I work for one of the Big 4 Consulting companies. Three months ago I met a
random barista at a coffee shop who said they wanted to get into software
development. I remember thinking “sure whatever”. A month later I was really
impressed by their progress. A month after that with even more progress I said
I’d hire him because I easily could give him 15-20 hours of extra work that he
could do for my team. I said the typical Freelancer hourly rate is to take the
yearly salary, divide it by 2, and then that’s the hourly rate. So assuming he
would make 80k entry level, hourly rate is $40. This person person just
started to cry, loudly and emotionally, when I said that. He said he’d never
though he’d make that kind of money in his life. Keep in mind this person had
a college degree and was 29. My dad was the kind of person who would never
cry, and I try to be like that too, but it was really hard not too at that
point.

~~~
prostoalex
There are two major sectors relying on H1-B employees - companies whose
product is some core tech (mainly in Silicon Valley and Seattle) and companies
whose core product is outsourcing & consulting fees. The abuse
disproportionately happens with the latter as it’s built into the business
model - difference between money billed to clients and money paid out to
employees is all pure margin.

The question is how to encourage the former type while discouraging the
latter.

To me a priority queue based on salary makes sense - Facebook or Microsoft are
likely to shell out $150,000+ a year for an employee they want, a consulting
body shop would not.

It also makes sense for the federal government who stands to collect more
income tax from higher salaries.

~~~
int_19h
Another way is to require companies to offer green card sponsorship for any
employee that asks. Sweat shops that use H1B to hire cheap labor are not going
to invest in that kind of thing, especially since the end result is that they
have less leverage over the employee.

~~~
diebeforei485
Sponsoring a green card does not necessarily mean the employee will receive it
anytime soon.

Because of country-of-birth quotas, an individual can be approved for a
skilled employment based green card but have to wait many decades, potentially
over a century, to receive one.

Making it much faster to receive an employment-based green card once approved
is the core problem that needs to be solved.

~~~
int_19h
I'm well aware - I went through that process myself.

What I'm saying is that it can still be a useful filter - companies that abuse
H-1B likely won't sponsor them for green cards at all.

------
part3
As an american, I'm really surprised at the quality of responses here which
are mostly skeptical of H-1B immigration benefits but then I see full throated
support to low skilled immigration. Is this because I'm from a flyover state
and can see the first hand damage low skilled immigration causes and most here
are ignoring that?

~~~
mdorazio
I like to think of it this way: the H1B program is well-intentioned, but has
been hijacked to a large degree by outsourcing companies and corporations just
looking to cut costs to the detriment of American workers. There are companies
using the program in a good way, but there are also a lot using it in a bad
way so you get a mix of opinions in comment threads like this one.

On the low-skill immigration side, it can be a good thing when immigrants come
to areas with plenty of jobs and act as supplementary labor rather than as
direct competition. For example, in some urban centers, immigrants make up a
large portion of nannies because working parents need help raising kids, but
local residents often don't want to do that kind of work. The net result is
more productive parents and an immigrant labor pool fulfilling a needed role.
On the other hand, in flyover states you tend to have a different set of labor
supply and demand situations and low skill immigrants can be detrimental. Most
HN commenters are yuppies rather than rural residents, so you get more
emphasis on immigration being a good thing.

~~~
part3
> immigrants make up a large portion of nannies

Those jobs would go to citizens if they weren't taken up by immigrants. Sure,
the salary requirements would increase, but isn't that literally the rallying
cry of politics right now? To pay people more?

So I have trouble squaring this: we want more low skilled immigrants, we don't
want to build a wall or any deterrant actually but we need to cap and reduce
high skilled immigration? Meanwhile, we need to lobby for more destructive
policies that will reduce the flyover states voting power?

~~~
mdorazio
That's highly debatable. Nannies only make sense if you pay your nanny
significantly less than your own after-tax salary. If the price is too high,
one parent just stops working because doing otherwise is foolish financially
and because "I'm spending all my money to pay a stranger to raise my kids." So
if immigrants were not available for the work and salaries rose accordingly, a
significant number of parents would leave the workforce and lower overall
productivity in the local economy. That's what I mean by supplementary labor.

Your last comment is assuming complete lack of nuance in common opinions. You
need to add some qualifiers to make it accurate. Something like this:

We want more low skilled immigrants _where they supplement rather than compete
with local labor_ , ... we need to _revise the program for highly-skilled
immigration without necessarily reducing overall number of immigrants since it
has been abused by multiple companies_.

I'm not sure what you're referring to on your last point. Flyover states and
rural communities in general are rather overrepresented in politics today [1].
Most debate on this issue I'm aware of is focused on returning to parity in
representation.

[1] [https://www.nytimes.com/2016/11/21/upshot/as-american-as-
app...](https://www.nytimes.com/2016/11/21/upshot/as-american-as-apple-pie-
the-rural-votes-disproportionate-slice-of-power.html)

------
dmode
As an H1-B visa holder, on EB2 green card queue for 7 years, and in the US for
over 12 years, working for a FAANG in the Valley, make a ton of money, I must
say it is kind of grinding reading repeated headlines (in HN and elsewhere)
about how I am the enemy of the American worker.

~~~
asteli
I know the politics are complicated, so take this with a grain of salt, but I
can't help but think that the easiest way to keep H1-B visa holders from
taking high tech jobs away from American citizens is to make them American
citizens. :)

~~~
davidw
That's a great answer! Barring that, just hand H1-B people a green card or
something that makes it _easy_ for them to switch jobs. That means they can
easily compete for the same wages everyone else gets, rather than being stuck
with one company.

~~~
int_19h
"Give them a green card" is essentially the same thing - the standard track to
citizenship is ... -> green card -> citizenship, you pretty much never jump
straight to the latter. Generally speaking, green card holders can apply for
citizenship after 5 years, and it's pretty hard to be ineligible for one, but
not the other (some people prefer to stay on green cards for other reasons).

------
kelnos
I know there have been some reforms since 2015, though I haven't kept up with
all the details.

Isn't there a simple fix for this? Set per-company max percentages for H-1B
visa holders. So if it's 15%, and you have 100 employees, only 15 of them can
be H-1Bs. I imagine there are probably ways to game this as well, but I'd
think it'd be easier to figure out when that gaming is occurring, and shut it
down.

Or is there just no political will to fix it?

~~~
mc32
You could also tax the companies per H-1B [25% -50% of salary?] and dedicate
that money to develop native talent [Get kids into STEM starting from K, and
train or offer education to candidates wanting to transition into new fields].

If a company really needs these workers, they’ll gladly pay the premium and
the local pool of workers or future workers get support to get into that field
and reduce the need to import labor. Allow H-1Bs a free transition to
alternate co. to ensure commensurate wages.

~~~
kelnos
An interesting idea, but in the end probably not something politicians would
like. (What does "money to develop native talent" go to, anyway?) Regardless,
large companies are experts at shuffling profits around to avoid paying taxes,
so I doubt this would curb the abuses.

The application process (fees to the government plus paying lawyers) already
costs a decent amount, so perhaps just raising those fees would help? The
outsourcing companies have pretty deep pockets, though, so in the end that
would just hurt smaller shops that actually have a need for H-1B workers.

I think per-company caps are the way to go. They don't hurt the companies, and
they should actually solve the problem.

An alternative might be to just outlaw these sorts of outsourcing firms.
Stipulate that H-1B visa holders must be employed by the company where they
actually work (no contracting arrangements), and the sponsor of the H-1B can't
be a third-party company.

------
omegaworks
At minimum, they should outlaw global outsourcing companies. They take an
inordinate cut from the employee's paycheck for the entire employment period
and provide little benefit to either the company trying to hire or the worker
being hired.

They're glorified recruiters with a foothold in a buyers market, and the H1B
system gives them anti-competitive leverage.

This whole system of tiered second-class employment creates a slew of perverse
incentives. The whole thing should be abolished in favor of clear citizenship
pathways and strict visa-blind labor rights across the board.

~~~
MisterBastahrd
I once worked for a consulting / recruiting firm that ultimately stopped using
H1 shops for talent entirely. This came after an incident involving a large
cosmetics corporation on a time sensitive project where an H1 employee was
ill, and so the project manager decided to go to her hotel to check on her.
She found 10 people from the same H1 consultancy living in a 2 bedroom
extended stay apartment. Our recruiter had no idea since we only dealt with
the contract from the H1 shop. The PM fired everybody from the H1 shop and our
company was blacklisted from doing business with them.

~~~
raincom
In the end, the employee receives 50% of what that cosmetics co paid to the
primary vendor.

~~~
pnw_hazor
Some Indian consulting companies or (managers at these places) require their
Indian H1B employees to kickback some of their official salary. Typically the
kickbacks paid by the employee are in the form of donations to selected
"charities" back in India. Thus, the w-2 salary of the H1B employee looks
reasonable on paper.

src: employee-rights lawyer buddies who have sued companies over this.

~~~
raincom
When I was working at AT&T, there was a different kind of kickback scheme at
play.

AT&T --> Primary Vendor (B) --> Another Vendor (C) --> H1B/others who work as
contractors for C.

Hiring managers and C have some sort of arrangement, wherein managers get paid
in cash by C. Primary Vendor (B) takes a cut for $3 per hour per candidate.
Even (B) knows what is going on, but does not care as long as it is easy
money.

Anyway, one such scheme got busted when I left that place. AT&T fired three
employees over this--two of these employees are brothers. The gist of it was
that (C) was controlled by wives of two of these employees. And that (C) was
placing 90% of candidates in AT&T NJ. This had raised suspicions--and other
primary vendors complained about this. So, AT&T found the conflict of interest
--that (C) was controlled by wives. And one of the wives was working as a
contractor for one of the brothers. Because of this, they terminated all
three.

Another company I am aware of, is doing this in the bay area. Here, the
primary vendor is itself controlled by a dad of one of the managers at company
D. This son at D pays in cash to the prospective managers, when their
candidate is picked up.

One company I worked at, had a different kind of play: primary vendor's hot
recruiter was involved with one of the hiring managers. Eventually, this led
to the termination of that said manager.

Lots of things go on behind the scenes.

------
TomMckenny
It's a really pity we can't have more calm, clear conversions like the nyt
article and this thread.

Regrettably, for the most part, conversations on the issue deteriorate into
one camp denying any problem exists, that several FANG companies were founded
by H1-B folk etc and the other camp espousing a generalized xenophobia.

And it really is something that needs to be looked at and fixed or the angry
people are just going to become more numerous and more extreme with demagogues
whipping the flames leading to who knows what outcome.

------
interlocutor
Without H-1B the tech industry would not be a major industry in the US. Think
about it: Yahoo would be a Taiwanese company, Google would be a Russian
company, Tesla would be a South African Company, eBay would be a French
company, Sun Microsystems would be an Indian company and so on. And that list
is just founders. Then there are rank and file employees and inventors in tech
companies that came from various parts of the world, that made these founders'
dreams into real products. Then there are CEOs and executives that ran these
companies.

Immigration restrictionists assume a zero-sum math for workers: A job gain for
a foreigner is a job loss for an American. By that logic every college
graduate who enters the job market would be cause for mourning. But that's
backward, given that skilled individuals create, not take away, jobs.

This doesn't mean abuse isn't happening. But the abuse doesn't detract from
the fact that the tech industry wouldn't be so big in this country without
H-1B.

~~~
porpoisely
H-1B has nothing to do with Yahoo, Google or Tesla. Stop it. Blatantly lying
doesn't add anything to the debate.

Jerry Yang and Sergei Brin immigrated to the US when they were children and
they became citizens before they co-founded yahoo or google. Also, you leave
out the fact that two of the founders of Google and Yahoo ( david filo and
larry page ) were native born americans.

As for Elon Musk, his grandfather was american and he became an american
citizen in 2002 before he founded tesla.

In other words, Yahoo, Google and Tesla were founded by american citizens.

You are intentionally conflating immigration with h-1b visas and lying about
the founding of yahoo, google and tesla to push an agenda. That's
disappointing.

~~~
geofft
What visas did Lily Yang or Mikhail and Yevgenia Brin enter on? I think
there's a fairly sound argument that we should be encouraging those, at least.

Elon Musk had Canadian citizenship and moved to Canada in order to enter the
US on a student visa, with the goal of getting an H-1B. By the time he founded
Tesla he had citizenship but he was certainly not a citizen when founding his
first companies. There's no public documentation of what his status was, but
it was likely either H-1B or TN. (He may also have overstayed his visa at some
point.)

~~~
pandaman
>What visas did Lily Yang or Mikhail and Yevgenia Brin enter on?

Not H1-Bs for sure, H1-B was introduced in 1990. As for Musk founding Tesla on
H1-B : he founded it by investing his PayPal money in some startup so it's
highly unlikely he had been on H1-B at the time (or ever). AFAIK you cannot
get H1-B sponsored by a company you own and you have to work for the sponsor
to remain in status. So who would have sponsored his hypothetical H1-B in
2003?

~~~
petilon
The exact visa doesn't matter. The point is, without immigration silicon
valley wouldn't be silicon valley.

~~~
pandaman
Then why bring the H1-B, a _nonimmigrant_ visa for _temporary workers_ , up
when arguing about benefits of _immigration_ ?

~~~
petilon
Because people who come in on H-1B are eligible to apply for green cards.

~~~
pandaman
People who don't come in on H-1Bs are eligible to apply for green cards too.
Being on H-1B does not make you eligible in any special way.

------
commonsense1234
the move towards preference for masters degree is a decent start. there is no
way someone with a masters degree would want to work for one of the consulting
firms.

~~~
mavelikara
F-1 students graduating from Masters programs at lower tier schools mostly go
work at staffing companies. These companies are worser abusers of H-1B than
global outsourcers.

~~~
commonsense1234
i agree with that. but, the proportion to how many h1bs get allocated to these
staffing companies vs outsourcing is maybe 1:20 even if taken as an aggregate.
even though it wont entirely eliminate the problem, it is still a good start.
The second thing is to create rules to directly discourage indirect employment
when on H1B (the abused vendor model).

~~~
mavelikara
If you compare two specific companies, your math is right. But if you compare
the aggregate number of H-1Bs allocated to all global consulting vendors to
those allocated to all American staffing companies, the numbers are much more
closer to each other.

Agree that stopping third-party employment is a great step. This
administration has been doing so by asking for higher levels of documentation.

------
readhn
H1-B's are not an issue.

The issue is the "consulting" IT companies abusing the H1-B system.

Make it illegal for these labor arbitrage companies to exist and at least this
problem will be solved.

~~~
beerlord
It should be like the visa lottery.

Limit any individual country (India or China for example) to a maximum of 10%
of the total visa allocation each.

Right now India gets 76% of all H1B visas, so Indians know the system inside
and out, and hire other Indians. Tech companies are calling out for female
workers, and most of these Indian migrants are also male.

Take it to 10% from any country max, and heck even require that 51% of the
visas must be given out to women, and you will see tech companies scour the
globe for talent, rather than all the visas just going to Indian body shops.
Under such a change you could even increase the total number of visas issued,
since the whole scheme would be less rorted and more socially accepted.

~~~
mavelikara
> Limit any individual country (India or China for example) to a maximum of
> 10% of the total visa allocation each.

Why country? Why not limit any individual continent to a maximum of 1/7th of
the total visa allocation? /s

If it isn't clear, I am pointing out that your suggestion is an arbitrary
restriction on skilled immigration.

------
godelmachine
Is Trump gonna introduce the points based system at all, which specifically
favors those foreigners who have degrees from US universities?

