The Battle Over H-1B Visas Heats Up With Conflicting Reports
Date : 03 11 2008 Category : Business
Techdirt
Last year, the supply of H-1B visas given to skilled foreign workers to work in the US, was exhausted after a single day, leading to many calls for the program to be expanded. As we get closer to this year's eligibility period, the expectation is for a similarly quick exhaustion of visas, so it's no surprise to see people rushing out studies that are both pro- and anti- H-1B extension plans. First, comes the controversy over newly released data pointing out that many of the companies who received the most H-1B visas happen to either be headquartered or have much of their operations based in India. Of course, the whole point of the H1-B is that these workers are in the US, so it's not entirely clear why it matters who the firm is. However, it does suggest that this may involve a situation where these firms are abusing the program and are not, as is required, first looking for qualified Americans to fill the jobs. Yet, just because some firms are abusing the program, it does not mean the program itself is a bad idea.
Meanwhile, Slashdot points us to an article claiming that there is no IT worker shortage, as some have claimed. The article is fairly balanced, looking at a few different recent studies that suggest there isn't a shortage -- though, there isn't much of a surplus either. It tries to reconcile the fact that companies are having difficulty hiring workers (which is undeniable) by suggesting that the problem is more with the hiring process than with the labor supply. Of course, that's just one interpretation. Another might be that many of these studies are counting all "IT workers" as equal, meaning that someone with obsolete skills or who is not particularly good, is considered the equivalent of a programming hotshot. The problem many firms are finding these days isn't that it can't find techies, but that the techies they're finding just aren't that good or qualified.
Finally, on the flip side of the coin, a study has come out dismantling the claims that H-1B visas tend to cost Americans jobs. Instead, it found the opposite was true: H-1B visas tend to create more American jobs. This is only counterintuitive if you believe that the labor market is a zero-sum game. However, as we recently noted, it is not. Bringing good workers into the US helps create more jobs here, because successful local companies help grow the economy and require even more workers. This is supported by the study, which found that for each H-1B visa issued by companies, five additional hires were made as well. With smaller companies, it was even more drastic, showing seven new hires. Furthermore, the study dispels the notion that H-1Bs are only used by companies looking to save money. It notes that when companies are facing hard times, they reduce the number of H-1B applications, suggesting that they're not being used to save money. If you've ever gone through all the paperwork (and lawyers fees) needed to hire an H-1B, you'd recognize that it's hardly a cheap or efficient process.
In the end, though, it's not hard to figure out the best path forward. The key is recognizing the simple fact that the labor market is not a zero-sum game. Bringing strong workers into the US, rather than having them compete from overseas, is much more likely to create more new jobs in the US. It shouldn't be difficult to understand this fact, though we always get angry comments from people who have trouble grasping it. It shouldn't be that complex however: if a company is doing well, it will need to hire more people. A company doesn't do well by letting the best available people (the ones who help them do well) work in other countries. This doesn't mean that it's okay for firms to abuse the H-1B process, but we need to separate the abuses (no matter how widespread) from the program itself. The goal should be to get as many smart, qualified workers working in the US, helping to expand our own economy, rather than working against it.
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Meanwhile, Slashdot points us to an article claiming that there is no IT worker shortage, as some have claimed. The article is fairly balanced, looking at a few different recent studies that suggest there isn't a shortage -- though, there isn't much of a surplus either. It tries to reconcile the fact that companies are having difficulty hiring workers (which is undeniable) by suggesting that the problem is more with the hiring process than with the labor supply. Of course, that's just one interpretation. Another might be that many of these studies are counting all "IT workers" as equal, meaning that someone with obsolete skills or who is not particularly good, is considered the equivalent of a programming hotshot. The problem many firms are finding these days isn't that it can't find techies, but that the techies they're finding just aren't that good or qualified.
Finally, on the flip side of the coin, a study has come out dismantling the claims that H-1B visas tend to cost Americans jobs. Instead, it found the opposite was true: H-1B visas tend to create more American jobs. This is only counterintuitive if you believe that the labor market is a zero-sum game. However, as we recently noted, it is not. Bringing good workers into the US helps create more jobs here, because successful local companies help grow the economy and require even more workers. This is supported by the study, which found that for each H-1B visa issued by companies, five additional hires were made as well. With smaller companies, it was even more drastic, showing seven new hires. Furthermore, the study dispels the notion that H-1Bs are only used by companies looking to save money. It notes that when companies are facing hard times, they reduce the number of H-1B applications, suggesting that they're not being used to save money. If you've ever gone through all the paperwork (and lawyers fees) needed to hire an H-1B, you'd recognize that it's hardly a cheap or efficient process.
In the end, though, it's not hard to figure out the best path forward. The key is recognizing the simple fact that the labor market is not a zero-sum game. Bringing strong workers into the US, rather than having them compete from overseas, is much more likely to create more new jobs in the US. It shouldn't be difficult to understand this fact, though we always get angry comments from people who have trouble grasping it. It shouldn't be that complex however: if a company is doing well, it will need to hire more people. A company doesn't do well by letting the best available people (the ones who help them do well) work in other countries. This doesn't mean that it's okay for firms to abuse the H-1B process, but we need to separate the abuses (no matter how widespread) from the program itself. The goal should be to get as many smart, qualified workers working in the US, helping to expand our own economy, rather than working against it.
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