The new bill to boost H-1B visas is based on a lie

The recession is over, salaries are going through the roof, and there’s a shortage of trained IT workers stifling the competitiveness of U.S. companies. It makes sense, then, to finally raise the cap on the H-1B visas, the legal document that allows technology companies to hire foreign nationals to work in the United States. You should support the bipartisan move in Congress to do just that.

None of the above is true. If you believe it, you’ve fallen victim to the propaganda churned out by technology companies eager to find a source of relatively low-paid workers whose desire to stay in the United States makes them unusually complaint and ripe for exploitation. What’s more, the very simple laws of supply and demand will tell you that a glut of IT workers would have the effect of lowering wages and working conditions for everyone in the industry.

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This is not just my opinion. Two of our colleagues at Computerworld, a sister publication, have done serious reporting on this issue and shown exactly who has imported the most workers under the H-1B program. The largest single users of H-1B visas are offshore outsourcers, many of which are based in India or, if U.S.-based, have most employees located overseas.

All seven of the companies that lead the pack when it comes to importing workers under H-1B are outsourcers, according to an analysis of U.S. Citizenship and Immigration service data by Computerworld. They are: Cognizant, Tata, Infosys, Wipro, Accenture, HCL America, and Mahindra Group.

“This is just affirmation that H-1B has become the outsourcing visa,” said Ron Hira, a public policy professor at the Rochester Institute of Technology and researcher of tech immigration issues.

There’s no shortage of IT workers Before I go further, I’ll repeat something I always mention when I cover the immigration issue: In no way do I think the foreign workers themselves are the problem. Like people everywhere, they simply want to make a better life for themselves and their children. An overhaul of our entire immigration system is long overdue. But raising the cap on H-1B visas is not the right way to go.

Under the Immigration Innovation Act of 2013, authored by a bipartisan group of senators including Orrin Hatch (R-Utah), Amy Klobuchar (D-Minnesota), Marco Rubio (R-Florida), and Chris Coons (D-Delaware), the maximum number of H-1B visas for high-skilled foreign workers would jump from 65,000 to 115,000. That number would be adjustable based on economic demand and could eventually go as high as 300,000 a year. Dependent spouses of H-1B visa holders would be allowed to work in the United States as well.

The bill has the support of major U.S. tech firms, including Microsoft and IBM, both heavy users of H-1B visas, and rests on the premise that there is a shortage of skilled IT workers. “It’s critical that America address the shortage of workers with science, technology, engineering, and math skills. There are high-skilled, high-paying jobs being created by American businesses across the country that are being left unfilled because of this gap,” said Microsoft general counsel and executive VP Brad Smith.

While there’s no doubt that the jobs picture for IT workers is much, much better than it was during the darkest days of the recession, there simply is not a glut. Unemployment in IT-related jobs is 3.7 percent — low, but still twice as high as it was before the financial meltdown.

When labor is truly short, salaries tend to spike. But that’s not happening. I’ve spoken to many employers over the past two years as I’ve reported on the improving employment picture, and almost none has said that salaries are exploding as they did in the years leading up to the dot-com bust.

Indeed, salaries in computer- and math-related fields for workers with a college degree rose only 4.5 percent between 2000 and 2011, says Ross Eisenbrey, the vice president of the Economic Policy Institute. “If these skills are so valuable and in such short supply, salaries should at least keep pace with the tech companies’ profits, which have exploded,” he wrote in an opinion piece for the New York Times.

But what happened last year on the salary front as the recovery kicked in? Not much. IT salaries inched up by less than 2 percent in 2012, pushing compensation back up to January 2008 levels, according to a study by Janco Associates, a research company.

Brain drain? There isn’t one Are employers working harder to find the best workers? Sure they are. But that’s a normal part of the labor market when a recession winds down, and not a symptom of a critical labor shortage. Anecdotal stories of unfilled jobs — I’m sure to hear them as soon as this post is published — simply don’t belie what real statistics show us.

Bloviators like Times columnist Thomas Friedman bemoan the alleged fact that there’s a brain drain in the United States and that we foolishly train foreign students, then send them packing to work for our foreign competitors. That’s baloney. As Eisenbrey writes:

According to the Congressional Research Service, the number of full-time foreign graduate students in science, engineering, and health fields has grown by more than 50 percent, from 91,150 in 1990 to 148,900 in 2009. And over the 2000s, the United States granted permanent residence to almost 300,000 high-tech workers, in addition to granting temporary work permits (for up to six years) to hundreds of thousands more.

The bill’s proponents argue that for the sake of our global competitiveness, we shouldn’t train, then return the tens of thousands of Chinese and Indian students who come here every year. But almost 90 percent of the Chinese students who earn science and technology doctorates in America stay here; the number is only slightly lower for Indians. If they’re talented enough to get a job here, they’re already almost guaranteed a visa.

“The failure of Congress and the Obama Administration to close loopholes in the H-1B program is reducing job opportunities for American high-tech workers and undermining their wages,” said Hira, the Rochester Institute of Technology researcher.

He believes the H-1B usage data should give pause to the lawmakers who introduced the Immigration Innovation Act. “If that bill were to be passed we’d see a major hemorrhaging of American jobs and it would discourage American kids from studying high-tech fields,” he said.

Am I wrong? I’m always open to that possibility, but before I admit it, I’d want to see real evidence, not the self-serving fictions of the technology giants and their credulous helpers in the media.

I welcome your comments, tips, and suggestions. Post them here (Add a comment) so that all our readers can share them, or reach me at bill@billsnyder.biz. Follow me on Twitter at BSnyderSF.

This article, “The new bill to boost H-1B visas is based on a lie,” was originally published by InfoWorld.com. Read more of Bill Snyder’s Tech’s Bottom Line blog and follow the latest technology business developments at InfoWorld.com. For the latest business technology news, follow InfoWorld.com on Twitter.