H-1B Reform Is In The Air (Can you smell it?)
H-1B Reform Is In The Air (Can you smell it?)
Date: Monday, April 09, 2007 9:49 AM
<<<<< JOB DESTRUCTION NEWSLETTER No. 1671 -- 4/09/2007 >>>>>
The name of the Informationweek article says it all -- reform is in the
air. The stench is so strong you should be able to smell it by now!
When most people talk about "reforming" H-1B, they mean they want to let
more of them into the U.S. This article had a statement by a spokesman for
Sen. Grassley that really caught my eye -- he stated that Grassley is OK
with raising the H-1B cap. If you recall, Sens. Chuck Grassley, R-Iowa, and
Dick Durbin, D-Ill recently introduced a bill that supposedly reforms the
H-1B and L-1 visa programs. The bill conspicuously lacks any type of limit
on the H-1B cap, which kind of follows considering Grassley's support of an
increase.
Grassley and Durbin have both voted in favor of every increase in the H-1B
cap so it's not really a surprise that Grassley supports an increase. It's
a shrewd political move on his part to endear himself to engineer and
programmer organizations by sponsoring a worthless reform bill while at the
same time letting high-tech employers know that they can count on his help
when it's time to raise the cap.
Meanwhile organizations such as the IEEE and the Programmer's Guild are
wagging the dog by publicly supporting Grassley's bill.
Corporations are in a panic because every available H-1B visa for fiscal
year 2008 has been gobbled up. The mainstream media is fueling the frenzy.
The LA Times article below calls the yearly cap on H-1B visas an "arbitrary
cap" that needs to be removed.
The third article makes a stupid comparison between H-1B and professional
baseball. It also contains some mythology that is appearing in articles all
across the country:
As it happens, most of the largest users of the H1-B program are not
American companies but foreign firms that want to move jobs out of
the United States. Seven of the 10 firms that requested the most
H1-B visas in 2006 were outsourcing firms based in India, which
use the visas to train workers in the United States before they
are rotated home, according to Ron Hira, an engineer who teaches
public policy at the Rochester Institute of Technology. Indian
outsourcing firms Wipro and Infosys were the two top requestors
of H1-B visas.
It seems that the "in thing" is to castigate Indian bodyshops as the ones
that hire the most H-1Bs. This is pure bunk! Casual readers would interpret
the statement above to mean that 70% of the H-1Bs are hired by Indian owned
bodyshops. Nothing could be further from the truth. While the big bodyshops
may be some of the largest employers of H-1Bs in terms of total number of
employees, their overall percentage of the share of total H-1Bs is quite
small compared to the entire number of H-1Bs employed by US owned
companies. Bodyshops may be some of the most abusive users of H-1Bs but
that is an entirely different subject which I have covered many times
before.
Does anyone who perpetuates this blame game ever think where a Tata or
Infosys worker with an H-1B visa goes to work after they are contracted out
of India? They work at U.S. owned companies such as Microsoft, Intel, Ford
Motor, and Charleston County. The term "bodyshop" is a slang term for
contract agencies and doesn't imply nationality, ownership, or even who
they hire. There are U.S. owned bodyshops that hire foreign H-1Bs
exclusively from countries such as India, China, and the Philippines.
Indian owned bodyshops don't have a monopoly on the cheap labor market.
The implication that restricting bodyshops would help to control the
rampant hiring of H-1Bs is ridiculous and totally contradicts the numbers.
Facts rarely seem to matter since it's so much easier to pin the blame for
H-1B on foreign owned companies instead of facing the fact that home grown
robber barons and elected politicians are the ones who have sold U.S.
workers out.
+++++++++++++++++++++++++++++++++++++++++++++++++++
http://www.informationweek.com/management/showArticle.jhtml?articleID=198800918
As The H-1B Visa Cap Filled In Record Time, Reform Is In The Air
If changes to the controversial foreign worker program happen, they'll
likely occur this year and be tied to increases in the visa cap.
By Marianne Kolbasuk McGee, InformationWeek
April 7, 2007
URL:
http://www.informationweek.com/story/showArticle.jhtml?articleID=198800918
For both critics and supporters of the H-1B visa, two days last week
revealed everything you need to know about the foreign worker program, one
of the most controversial topics in business technology.
In the first two days that the U.S. government accepted applications for
H-1B work visas, 133,000 envelopes poured in with applications seeking
65,000 openings. The crush was enough that U.S. Citizenship and Immigration
Services cut off new applications, certain the envelopes it had--many with
multiple applications--would fill the slots. It's the fastest the
application period has ever closed. Last year, the cap was met May 26, the
year before that in August.
H-1B visa supporters see the overflow as reason to raise the cap so
businesses can get the talent they need from abroad. Critics see the queue
as a mockery of what the H-1B is supposed to be. Instead of a ticket for
the supertalented to work in the United States, the visas are being
hoovered up, often by offshore outsourcing companies that want to train
workers on U.S. business and technology practices so they'll be better
workers when they head home.
Reformer Grassley isn't opposed to raising the visa cap
Photo by Sipa Press
In 2004, in the trough of a U.S. recession, Congress lowered the visa cap
to 65,000 after three years at 195,000. In 2005, it added 20,000 visas for
foreign nationals who graduated from U.S. universities. The tech
industry--which takes the majority of the visas--has been pushing to raise
the ceiling to at least 115,000. However, the policy debate in Washington
this year could move beyond the cap number to more serious reform, starting
with a bill introduced last week by Sens. Chuck Grassley, R-Iowa, and Dick
Durbin, D-Ill. (More on that later.)
Differences are emerging within the pro-H-1B camp. Major U.S.-based
software vendors, most of which look to bring foreign workers here
indefinitely, are subtly trying to distinguish their needs from companies
that want an ever-rotating staff of short-term foreign workers.
Still, tech employers continue to speak with one voice about the need to
increase the number of H-1B visas. Last month, Microsoft chairman Bill
Gates testified before a Senate committee on the need to let more people
from abroad work here, accurately predicting that the H-1B allotment would
quickly be filled. "The question we must ask is, how do we create an
immigration system that supports the innovation that drives American
growth, economic opportunity, and prosperity?" Gates said. His
recommendations centered on attracting the best students from abroad to
study here and stay when they finish, and to expedite work privileges and
permanent-resident status for highly skilled workers.
How is the market for IT jobs in the U.S.? Merely OK. The IT unemployment
rate based on an average of the past four quarters is 2.3%, according to
Bureau of Labor Statistics data released last week. To compare that,
unemployment across all management and professional jobs, IT and non-IT,
was 2.2%.
Some segments have boomed: In IT management, jobs are up 31% since the tech
employment nadir of 2003, and unemployment is 1.9%. Jobs in the largest IT
category, software engineers, are up 17% from 2003 and unemployment is
1.7%. But the second largest category, computer scientists and system
analysts, has been flat since 2003, with 2.6% unemployment today. Support
specialists see 3.2% unemployment, network and system admins 3.6%. Overall,
IT jobs are up just 1% since 2001 and 5% since 2003.
HOW IT WORKS
So what happens to those 133,000 envelopes full of applications? USCIS
officials enter the data from the paper petitions, then randomly select
them like a lottery. Officials can reject petitions, but that rarely
happens.
Once an H-1B visa is granted, the recipient can seek renewal after three
years, letting that person work in the United States for up to six years.
Workers can change compa-nies, though the new employer must be up for some
bureaucratic legwork.
Beyond the 65,000 general H-1B visas and the 20,000 more for foreign grads
of U.S. universities, there are exemptions for working at universities and
other nonprofits. No one's entirely sure how many people are in the country
on H-1B visas at a given time, but as many as 120,000 new H-1B visa holders
join the U.S. workforce each year through the allotment and exemptions,
estimates Rob Hira, a professor at Rochester Institute of Technology who's
on leave at the Economic Policy Institute and is critical of H-1B
practices.
Hira's research concluded that for fiscal year 2006 seven of the 10 biggest
applicants for H-1B visas were India-based IT companies, led by Infosys and
Wipro. Wipro declined to discuss the issue, and Infosys didn't return calls
for comment. Other companies with major offshore outsourcing businesses
that have applied for H-1B visas, including Tata Consultancy Services,
Satyam, and U.S.-based Cognizant and Accenture, also declined to comment or
didn't return calls.
There were several unsuccessful bipartisan efforts last year to raise the
cap as part of comprehensive immigration reform, including one passed by
the Senate modeled on a Kennedy-McCain proposal. Another was the standalone
"SKIL" bill focused on streamlining green card processes and raising the
H-1B cap.
This session, there has been one comprehensive immigration reform bill, by
Reps. Jeff Flake, R-Ariz., and Luis Gutierrez, D-Ill., that proposes
raising the visa cap to 115,000, with a total not to exceed 180,000
annually.
REFORM IS IN THE AIR
But it's the Durbin-Grassley bill that would break new ground. It's aimed
at H-1B and L-1, which isn't capped and is designed for managers of
multinationals. The Durbin-Grassley bill would bar companies from
outsourcing H-1B or L-1 employees to other companies; it would require all
employers with H-1B workers to pledge that they made a "good faith" effort
to fill those jobs with American workers, something now required only of
companies with 15% or more of their employees on H-1B; and it would require
them to advertise jobs on a Labor Department Web site for 30 days and post
summaries of all H-1B applications. It would also give the Labor Department
more authority to investigate abuses.
"It's a great bill to fix the problems," Hira says. Addressing such abuses
would lower demand and make it less likely that the cap would have to be
raised, he contends. Others want broader reform kept separate from the cap
discussion, having seen past efforts wither while caps increase. "This time
around I think we need to reform the H-1B program first," says John Miano,
founder of the Programmers Guild, an IT professional organization opposed
to H-1Bs.
Reform is unlikely to go forward unless it's tied to a cap increase, and
Grassley isn't opposed to raising the cap, a spokeswoman says. A Senate
debate on the immigration issue is expected in two months, she says.
This looks like a make-or-break moment for H-1B reform. If it doesn't
happen this year, it's not going to happen in 2008, when politicians will
be focusing on the presidential election and their own re-elections. "If we
get action, it'll be before '08," says Robert Hoffman, Oracle's VP of
government and public affairs and co-chair of Compete America, whose 30 or
so members push the tech industry's immigration agenda.
Hoffman says the H-1B program gets a bad rap partly because it's a
"catch-all"--it covers people that companies bring to the U.S. for
short-term stints and people that companies are trying to get on a
permanent-resident track. More than 90% of Oracle's visa workers are trying
to stay in the United States and are on the path to permanent residency,
Hoffman says.
It may be controversial that companies import employees under H-1B visas
just to train them and then return them to other countries, but it's a
perfectly legal use if they pay prevailing wages--the visa is temporary.
It's also a practice their U.S. business customers quietly support, as they
want their offshore teams to be well trained.
If the goal is to make it easier for foreign talent to permanently stay in
the U.S., some see green card reforms as a smarter approach than more H-1B
visas. Hoffman notes the green card process has long waits and quotas that
end up frustrating many people, driving them to leave the United States.
The sidelined SKIL bill proposed streamlined green card processes and a new
visa class, F-4, to let foreign students with degrees from U.S. schools get
jobs in this country with a path to permanent residency. "We can absorb the
highly skilled worker best with green cards," Hira says.
The risk with Washington's approach is that it mashes issues like H-1B visa
reforms with a larger, comprehensive immigration reform bill, so
"high-skill versus low-skill" issues become conflated, says Robert
Atkinson, president of the Information Technology and Innovation
Foundation. Atkinson says the most-needed reform is for the Labor
Department to enforce rules to pay visa holders prevailing wages.
When it comes to wages, Kim Berry, president of the Programmers Guild,
offers up his own idea as a deterrent to H-1B abuse. If wage is a measure
of skill and scarcity, "why doesn't [USCIS] grant the visas to the
highest-paying candidates, rather than use a lottery?" he suggests.
Not likely. But for all those looking to reform or ramp up the H-1B
program, this is the year to try.
+++++++++++++++++++++++++++++++++++++++++++++++++++
http://www.latimes.com/news/opinion/editorials/la-ed-h1b07apr07,0,1269551.story?coll=la-news-comment-editorials
Let in skilled labor
The U.S. needs more highly skilled workers, but an arbitrary quota prevents
them from coming here.
April 7, 2007
SELDOM HAS IT BEEN so clear that U.S. immigration policy is
counterproductive to U.S. interests as it was on Monday. That's the day
companies began filing applications for high-skilled foreign workers - and
it's also the day the quota was filled.
Technology companies and other businesses filed more than 100,000 petitions
requesting H-1B visas for their employees, easily surpassing the annual
65,000 quota. With the demand for skilled workers clearly exceeding the
arbitrary limit, Congress should raise the cap so fewer U.S. companies have
to turn to outsourcing and more skilled people can work in the United
States.
H-1B workers, typically Indian and Chinese people with technological
degrees, are promised a prevailing wage. Their employers, mostly technology
companies, have to attest that they have not displaced U.S. workers if more
than 15% of their workforce is here on H-1B status. Employer demands for an
increase in the H-1B quota (and the quota itself) have fluctuated with the
economy. During the dot-com bubble, pressure to increase the cap was almost
constant. In the years since, the pressure has receded, and the U.S.
decreased to 65,000 - from 195,000 - the number of foreign workers it
accepts on H-1B visas. Now pressure to allow more workers into the U.S. on
H-1B status is increasing again.
More skilled immigrants would be able to remain in the U.S. if Congress
allowed the H-1B visa cap to fluctuate with the market. Strictly enforcing
the prevailing wage and other requirements, while also encouraging U.S.
students to pursue science, would also ensure that Americans can
participate in these dynamic job markets.
And - as with immigration policy generally - H-1B visa changes must be
approached comprehensively. The H-1B is a three-year, temporary visa that
can be renewed only once. Visa holders who seek to become lawful permanent
residents face enormous backlogs that will only grow if more H-1B visas are
granted. Ideally, an increase in H-1B visa quotas would be accompanied by
an increase in the quota for green cards. Skilled workers are also more
likely to stay and contribute to the U.S. economy if their immediate
families can join them here; currently, family members also face severe
backlogs.
President Bush appears to recognize the importance of skilled labor to the
U.S. economy. "It makes no sense to say to a young scientist from India,
'You can't come to America to help this company develop technologies that
help us deal with our problems,' " he said in January. And, he might have
added, by coming to America, they also help the U.S. economy stay
competitive.
+++++++++++++++++++++++++++++++++++++++++++++++++++
http://money.cnn.com/2007/04/05/news/economy/pluggedin_gunther_immigration.fortune/?postversion=2007040510
Baseball, technology and immigrants
America embraces foreign-born ballplayers, but not engineers, much to the
dismay of big business, says Fortune's Marc Gunther.
By Marc Gunther, Fortune senior writer
April 5 2007: 10:02 AM EDT
NEW YORK (Fortune) -- Imagine if the baseball season had begun this week
without such foreign-born stars as Albert Pujols, David Ortiz, Justin
Morneau and the latest Japanese import, pitcher Daisuke Matsuzaka and his
mysterious "gyroball."
It wouldn't be as much fun, would it? Fans want to see the most skilled
players compete - immigrants and Americans.
So why is it that people don't want skilled immigrants to compete for jobs
in the multibillion-dollar technology industry?
They view these immigrants as a threat. CNN anchor Lou Dobbs argues
permitting more educated, foreign-born engineers, scientists and teachers
into the country would force many qualified American workers out of the job
market.
That may be true in baseball, where the number of jobs on big league
rosters is fixed. That's not necessarily so in technology, where people
with skills and ambition help expand job opportunities. Immigrants helped
start Sun Microsystems, Intel (Charts), Yahoo! (Charts), eBay (Charts) and
Google (Charts). Would America be better off if they'd stayed home?
"This is not about filling jobs that would go to Americans," says Robert
Hoffman, an Oracle (Charts) vice president and co-chair of a business
coalition called Compete America, which favors allowing more skilled
workers into the United States. "This is important to create jobs. It's not
a zero sum game."
This week, as it happens, is not just opening week of the baseball season.
It's the week when employers rush to apply for the limited number of visas,
called H-1B visas, that became available on April 1 to allow them to
temporarily hire educated, foreign-born workers. This year, Congress has
allowed 65,000 of these H-1B visas, plus another 20,000 for foreign-born
students who earn advanced degrees from U.S. universities. After obtaining
guest-worker visas, employees can then seek green cards that allow them to
stay in the United States
FedEx and UPS did a brisk business last weekend because the visas are
awarded on a first-come, first-served basis. The first 65,000 are already
gone. The 20,000 earmarked for graduates of U.S. universities will be
distributed in a month or two, experts say.
This makes it very hard for companies to hire foreign-born graduates of the
U.S.'s top schools. More than half the graduate students in science and
engineering at U.S. universities were born overseas.
"It's sending a signal to the best international students that they may not
want to make their career in the United States," says Stuart Anderson,
executive director of the National Foundation for American Policy, a
research group. (Anderson, an immigration specialist, also wrote a study of
baseball and immigration that's available here as a PDF file.)
Expanding H1-B visas is a top priority for U.S. tech firms. Bill Gates,
Microsoft's (Charts) chairman, told Congress last month: "I cannot
overstate the importance of overhauling our high-skilled immigration
system.... Unfortunately, our immigration policies are driving away the
world's best and brightest precisely when we need them most."
CNN's Lou Dobbs was unimpressed. "The Gates plan would force many qualified
American workers right out of the job market," he fretted on the air after
Gates testified. "There's something wrong when a man as smart as Bill Gates
advances an elitist agenda, without regard to the impact that he's having
on working men and women in this country."
It's not just Dobbs. Internet bulletin boards and blogs are filled with
complaints about foreign-born engineers. The U.S. branch of the Institute
of Electrical and Electronics Engineers, the leading society of engineers,
brought about 60 engineers to Washington last month to ask for reforms to
the H-1B program. IEEE-USA supports a bill proposed by Senators Dick
Durbin, an Illinois Democrat, and Chuck Grassley, an Iowa Republican, that
is designed to crack down on companies that use the guest worker program to
displace Americans from jobs.
As it happens, most of the largest users of the H1-B program are not
American companies but foreign firms that want to move jobs out of the
United States. Seven of the 10 firms that requested the most H1-B visas in
2006 were outsourcing firms based in India, which use the visas to train
workers in the United States before they are rotated home, according to Ron
Hira, an engineer who teaches public policy at the Rochester Institute of
Technology. Indian outsourcing firms Wipro and Infosys were the two top
requestors of H1-B visas.
In a paper for the Economic Policy Institute, Hira says that expanding H-1B
visas without improving controls will "lead to more offshore outsourcing of
jobs, displacement of American technology workers (and) decreased wages and
job opportunities" for Americans. He told me: "Bill Gates talks about how
you are shutting out $100,000-a-year software engineers. But if you look at
the median wage for new H1-B workers, it's closer to $50,000."
Asked about that, Jack Krumholtz, who runs Microsoft's Washington office,
said the average salary for Microsoft's H1-B workers is more than $109,000,
and that the company spends another $10,000 to $15,000 per worker applying
for the visas and helping workers apply for green cards. "We only hire
people who we want to have on our team for the long run," he said.
It seems clear that Microsoft - along with Oracle, Intel, Hewlett Packard
and other members of the Compete America coalition - do not use the guest
worker program to hire cheap labor. They just want to hire the best
engineers, many of whom are foreign born.
So what to do? Everyone seems to agree that the H1-B program needs fixing.
(Even Hira, the critic, says the United States should absorb more
high-skilled immigrants.) Whether Congress can fix it is questionable. The
guest-worker program is tied up in the debate over broader immigration
reforms.
But guess what? Just last year, Congress passed the Compete Act of 2006,
which stands (sort of) for "Creating Opportunities for Minor League
Professions, Entertainers and Teams through Legal Entry." Yes, that law
made it easier for baseball teams to get visas for foreign-born minor
league players.
If the government can fix the problem for baseball, surely it can do so for
technology, too.
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