Although the H-1B visa program is misunderstood by many, Corporate America is pleading for Washington to expand the H-1B cap so that U.S. companies can compete in the international market. This is not an issue of “cheap labor;” rather, the H-1B program provides corporations with skilled labor- mainly in STEM disciplines; i.e. science, technology, engineering, and math.
What is an H-1B visa?
H-1B visas are designed for workers with “specialty occupations” who have a bachelor’s degree or higher from a U.S. university or the equivalent. For more specific information, see H-1B Visa information. H-1B is a non-immigrant visa that is typically issued for a period of 3 years subject to renewal. Many H-1B workers pursue more permanent immigration status via an EB green card while working under H-1B.
H-1B workers must have a sponsoring employer and must remain employed, by the original sponsoring employer or a subsequent sponsoring employer, throughout the 3-year period. Otherwise, they must leave the country. Moreover, a number of procedures are in place, including the Labor Condition Application (LCA), to ensure that H-1B workers do not adversely affect U.S. workers in terms of both wages and working conditions.
Why do U.S. corporations need foreign-born workers?
Yes, the U.S. unemployment rate has been high recently – but not amongst workers in STEM fields. In fact, according to an article from the Boston Globe, the unemployment rate for high-level STEM workers is half the national average. Moreover, although U.S. companies are looking to hire 120,000 computer engineers annually, only 40,000 engineers graduate from U.S. universities.
U.S. companies, from start-ups to large corporations, need H-1B workers to fill the STEM gap that the American educational system is trying to address with new magnet schools and college scholarships. They need technically oriented employees with biotechnology, computer science, and other advanced skills. Unless and until the U.S. school system can generate the quantity of highly skilled workers needed, H-1B workers are the logical solution for companies seeking to innovate and compete in international markets.
The H-1B Cap and Its Implications
The government has capped the annual number of H-1B visas to 65,000 employees per year, which is not enough to bridge the current talent gap. In fact, each year as the H-1B application process opens on the first business day in April, the number of applications well exceeds the cap within a matter of a few weeks, or even a few days.
Moreover, although exceptions exist for a) contractors not directly employed by U.S. companies; b) Chilean and Singapore nationals under the Free Trade Agreement; and, perhaps most importantly, c) 20,000 foreign nationals who have earned a master’s degree or higher from U.S. universities, the need for highly skilled workers is still not being met. For example, the total number of H-1B visas in fiscal year 2012 only equaled 135,991. (See the Report of the Visa Office 2012.)
Immigration Reform and H-1B: Items on the Table
Most politicians agree on both sides of the aisle that the H-1B program should be expanded through immigration reform. See, for example, these statements from Condoleezza Rice, the Republican Former Secretary of State, and Hillary Clinton, the Democratic Former Secretary of State and potential 2016 presidential candidate. Others, like Sen. Chuck Grassley (R-Iowa) and Dick Durbin (D.-Ill.), have raised concerns about fraudulent abuse of the H-1B program, but the most likely solution is centered on anti-fraud legislation. (See the Washington Post’s Wonkblog, Do we need more skilled foreign workers?)
Although immigration reform is still being hashed out, the “Gang of Eight” (four Democrat and four Republican Senators) have recommended legislation that would:
- Increase the cap from 65,000 to 110,000 – and increase the exception for U.S. based degree holders from 20,000 to 25,000 for STEM talent;
- Raise the cap in future years up to 180,000;
- Further protect American workers by requiring employers to pay higher wages for H-1B workers based on a three-level occupational classification system;
- Establish a 60-day grace period for H-1B employees to change jobs;
- Provide “dual intent” status for all U.S. based college and graduate students; and
- Permit spouses of H-1B workers to work if their country reciprocates with respect to spouses of U.S. workers abroad.
Benefits of the H-1B program for the U.S. economy
H-1B Visas Help the Economy
Not only do H-1B visas help fill the gap for STEM-skilled workers in the U.S., it also stimulates the country’s economy. Among other benefits, it has been found that:
- H-1B visas and EB green cards create more jobs for U.S. employees than they take away. In fact, high-tech companies add five additional jobs for every H-1B employee based on a study from the Foundation for American Policy.
In summation, H-1B visas do more good than harm and the U.S. economy would benefit by expansion of the program. Although immigration reform has been slow to come given the current political climate, it is critical to the success of both Corporate America and U.S. citizens.