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Evidence That H-1B Holders Don't Replace US Workers
Okian Warrior writes: In response to Donald Trump's allegations that H1B visas drive Americans out of jobs, The Huffington Post points to this study which refutes that claim. From the study: "But the data show that over the last decade, as businesses have requested more H-1Bs, they also expanded jobs for Americans." This seems to fly in the face of reason, consensus opinion, and numerous anecdotal reports. Is this report accurate? Have we been concerned over nothing these past few years? Remember, this is about aggregates, rather than whether some specific job has been replaced.
What the H1B provides is a means for an employee to *NOT* participate in relocation. By offering H1B positions, companies do not actively recruit people from other areas, assist in relocation, the alternative is to open more branch offices in other locations near the groups of people. Instead, they offer the H1B because (1) the cost of that worker is less, and (2) they do not need to provide relocation. Lastly, most H1B workers want a green card. The problem is once the worker starts the green card process they are sort of an indentured servant to the sponsoring company. They cannot quit, they cannot threaten to leave otherwise they loose the green card. This process lasts from 3 to 6 years. If the H1B worker had job mobility as a normal american does, the H1B worker would recognize the low pay, demand higher pay, or move on to another job in the USA leaving the low paying company with a hole. This job mobility (or non-mobility) by the H1B worker solves or causes the problem. I know this, I have been involved with these types of decisions, or watched these types of decisions occur right before me over the last 30+ years writing software.
Also, remember that part of the fight is about _expanding_ the pool of H1-Bs. From the pov of the employers, if current levels of H1Bs mean they aren't getting cheaper labor, then clearly they don't have enough H1-Bs. The study doesn't project what would happen if the number were increased substantially.
This is BS. The author of TFA is using the third type of lie, statistics, to suggest that H-1Bs aren't having a negative affect, by setting up a strawman argument. Sure, H-1Bs may not increase unemployment, IN AGGREGATE. But that's as easy as saying, "Well, Initech replaced 50 American coders with H-1Bs, but there's a new McDonalds open down the road that hired 60 people at minimum wage, so unemployment is down!"
There was no mention of salaries, benefits, much less anything specific to particular fields, not even "IT." At most he made an argument that "STEM grads are less likely to be unemployed" but that means nothing, because that can still be true even if they're not being given the opportunities they should.
This is just a rewording of the old saw that illegal immigrants are doing the jobs that Americans won't do -- at salaries that are too low. If the flow of H1-Bs dried up, then wages would rise as the American tech workers would become more valuable. As wages rose, then becoming a tech worker would be viewed more favorably.
With the same evidence, Huff Po could have argued that H1-Bs are depressing wages for American tech workers.
Any other day and HuffPo would be telling us about the horrors of H1B abuse by large corporations. However, if it means furthering the narrative that Trump is bad, then suddenly H1Bs are good.
It means there's more demand for CHEAPER skilled workers than the native talent pool has.
There is ALWAYS demand for less expensive labor. Sometimes it isn't available. Sometimes companies engage in measures to reduce labor costs. Importing cheaper labor is fundamentally no different than offshoring the work. The basic goal is the same - to reduce labor costs. I run a manufacturing company and we do all our work domestically and pay as much as we can but our competition does a lot of their work in Central America or China so we really cannot compete on jobs with a high labor content unless there are special requirements like engineering help or just in time delivery. We simply cannot pay much more than we do and remain competitive.
Some companies are obviously engaged in some shady tactics to keep labor costs down. The tactics may be reprehensible but the fact that they are trying to contain labor costs should surprise no one. In a competitive market companies HAVE to try to do that. It's particularly galling though when the company has huge profit margins like Microsoft or Facebook does. A low margin manufacturing company might go out of business if they don't keep a tight lid on labor costs. A hugely profitable tech company has no such excuse.
I've heard stories from a technical director at a major American firm where they'd reject PHDs simply because they were worried they'd leave for higher paying jobs elsewhere.
It's not just PHDs. I have a pair of masters degrees and I've been told point-blank during interviews that they were afraid I would get bored and leave or seek higher paying work. It's incredibly short sighted but it happens pretty routinely.
Well, of course. Every foreign worker hired is a job that doesn't go to an American worker.
Claiming that hiring foreign workers doesn't take jobs away from American workers is bizzaro logic at its best. Its the same bizzaro logic that said shutting down factories and sending millions of jobs to Mexico and China creates job for American workers.
More importantly, the claim that these are "highly skilled workers" is a lie that insults our intelligence.
Why is it that all of these "highly skilled workers" come from the same place - a country where a huge percentage of the population is illiterate and lives in poverty far beyond anything that exists in the U.S. A country where 350 million people, more than the entire population of the U.S., shit in public because they don't have access to a toilet. How is it possible that such a country is producing such huge numbers of "highly skilled workers"?
That's right, it isn't possible. The only "skill" they possess is a willingness to work for low wages. And since the H1-B program is nothing more than legalized indentured servitude, companies can do anything they want without feat of being reported by the workers.
Any other day and HuffPo would be telling us about the horrors of H1B abuse by large corporations. However, if it means furthering the narrative that Trump is bad, then suddenly H1Bs are good.
Someone finally states the correct spin of the article. I doesn't matter who funded the study or why, it's needed to attack Trump.
If you think I voted for Trump because of this post, you're wrong. I voted for Dr. Jill Stein of the Green Party. Again.
You realize you just told the world you don't know what "far left" means, right?
I suppose when you yourself are far left but tell yourself you are moderate, then everything seems far right by comparison.
From my understanding once the employee leaves infosys for another company then infosys does not have control anymore.
That's the thing - the H1-B would have to quit first (*if* another company is willing to take him on), which would be an escape. However, as noted, it is an added expense. Also, if the client company complains, the H1-B usually gets recalled to India for 'reassignment'. I cannot claim to know what happens after that, but unless that H1-B has a rare skill, I bet it isn't pretty. Note that this is technically illegal, but yet it's still there, as evidenced by the relationship between, say, Infosys and their client companies.
You claim it is a small part of the person's salary, but it still requires work from the new company's HR department, so unless they already have someone there set up to handle H1-B visas, they'll have to spend the time to do it (which in turn costs money) - and no, unlike your assertion, it is not a simple matter.
Quo usque tandem abutere, Nimbus, patientia nostra?
> I've heard stories from a technical director at a major American firm where they'd reject PHDs
> simply because they were worried they'd leave for higher paying jobs elsewhere.
Employers who think this way will ultimately hire the employees they deserve.
Pay is not the only thing that attracts a person to a job (or keeps them there). A person leaves
for a *better* job, which may or may not mean it offers higher pay.
But no, the majority of H1-B workers are not "slaves".
Of course not, nowadays we call them "salaried employees" instead. Have you seen the 10th Edition of the Newspeak Dictionary?
Kindly tell me how many companies are willingly going to take on someone under those conditions?
Here in Silicon Valley, "stealing" H1Bs from other companies is a common occurrence. Hiring them away from a competitor is way easier than doing all the paperwork to bring them direct from India. My company has done some stealing, and we have also been stolen from.
Besides the rural population you already mentioned, there are another 350M middle class there, and yet another 350M there that are quite well off, have access to excellent schools thus becoming as "highly skilled" as a westerner.
Why people want to claim such easy to disprove bullshit is quite befuddling. No country has a good balance between rich, poor, and middle class. The 1/3rd of the population you claim exists and is "quite well off" simply does not! India is very similar to the US where the top .01% own most of the country and the top 10% own 90% of the wealth just like the US. There are more people in extreme poverty in India which makes them worse than the US.
Getting a degree does not make a good and productive worker in a foreign country. If it did, every company would have more Chinese workers than Indian workers because that is who the numbers have favored for decades. There is quite a bit to that discussion, more than I care to get into in this thread. Anyone that has dealt with development and support out of a foreign country knows exactly what I'm talking about.
Your personal anecdote with hiring does not change the fact that H1B workers are easily pressured into working far more than anyone should. Recent criminal actions against several companies for human rights violations in the SF Bay area should make that abundantly clear, and we only know about the few that were abused to a point where they turned in their sponsors. Of course a H1B worker is "hard working"! That is the point of people calling it a legal indentured servitude. For every one company that uses the system correctly there are at least as many that don't.
-The wise argue that there are few absolutes, the fool argues that there are no probabilities.
I see two obvious errors in logic in this analysis.
1. Rising total employment of Americans does not mean that other Americans were not replaced by H1B holders. If there were no H1Bs, employment of Americans would have been even higher. What sloppy logic!
2. From the article: "If H-1Bs were primarily cheaper substitutes for American labor, the pace of H-1B requests...should rise when unemployment rises, as employers look to cut labor costs by laying off workers." In what universe does this logic make sense? If unemployment is higher, cheaper labor can be obtained by hiring more Americans since they are having a harder time finding a job. The actual results are completely consistent with H1Bs being a cheaper replacement for American workers.
"He took a duck in the face at 250 knots." -- William Gibson, Pattern Recognition
But neither Scenario A or B is the common one.
Scenario C - company doesn't hire the American worker that suits the role, and chooses to import a worker at 60% the salary cost. Company C rejects all American workers they can based on any criteria they can find, while accepting falsified resumes by H1B importer companies. Company C, who would of had to spend $1 million on American workers saves $400,000 on H1B workers. Rather than increase salary, the $400,000 is divided in two, $200,000 goes to investors, and $200,000 goes to executive bonuses.
American worker finally concedes, lowers salary from $100K to $75K. Gets hired. Company C then hires H1B workers at $50K instead of $60K. Result, our own government IT jobs are filled with 30 man teams in which 3 are Americans and the rest H1B.
That's far more the accurate scenario.