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Issa Bill Would Kill A Big H-1B Loophole (computerworld.com)
ErichTheRed writes: This isn't perfect, but it is the first attempt I've seen at removing the "body shop" loophole in the H-1B visa system. A bill has been introduced in Congress that would raise the minimum wage for an H-1B holder from $60K to $100K, and place limits on the body shop companies that employ mostly H-1B holders in a pass-through arrangement. Whether it's enough to stop the direct replacement of workers, or whether it will just accelerate offshoring, remains to be seen. But, I think removing the most blatant and most abused loopholes in the rules is a good start. "The high-skilled visa program is critical to ensuring American companies can attract and retain the world's best talent," said Issa in a statement. "Unfortunately, in recent years, this important program has become abused and exploited as a loophole for companies to replace American workers with cheaper labor from overseas."
I can only hope that our voices are STARTING to be heard and taken seriously.
I can't compete with an h1b. I have more experience, I know silicon valley quite well, I have good contacts and can get things done; but I'm 'an expensive american' because I have US healthcare to pay and US rents to pay, etc. and I'm not willing to have 5 other room mates and live-for-work just to stay employed.
we need a break from this heat wave. many of us who need work cannot get it. companies stopped caring about us and refuse to even consider us. we badly need relief from this or we'll find more of us slipping into the poorest underclass and that's just an absurdity. intelligent and capable thinkers and builders unable to get work because our corp overlords sold us all out.
I'll believe in the relief when I see it. so far, though, its killing many of us. in some ways, almost literally (I may lose my home soon, that's how bad it can get).
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"It is now safe to switch off your computer."
This should be a no-brainer.
I'll be shocked if it even makes it to a vote.
(captcha: divisive)
it's already much, much cheaper to hire over seas. Adding the expense of bringing someone over on an H1-B doesn't help. If companies didn't have a reason to use the H1-B program then they wouldn't.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Most americans were actually against removing the trade barriers that allowed labor market shopping of the kind you imply. The agreements were railroaded through anyway.
Most Americans would actually support reintroduction of tariff and excise costs on foriegn goods and services, even though this will increase domestic product cost.
The government already does cost-of-living adjustments for government employees. How hard is that to apply to H1-B? Here in Detroit, $60K probably isn't a bad minimum for H1-B workers, but it's crazy low in the San Francisco Bay. Why not tie the minimum to the region?
We need green cards to be given out for techs, while killing off the H1B.
Hopefully, this will be addressed in the next CONgress, or perhaps in the lame duck.
I prefer the "u" in honour as it seems to be missing these days.
Can you provide some details as to why this would happen and how?
Pretty simple really. Our shop isn't going to fork out 100K/year for US talent when off-shore talent is about 1/2 the cost...
Karma: Bad
and in some time afterwards, when they realize that we have infrastructure that pretty much WORKS and they do not, they'll be back.
yeah, its cheap in india. when the electricity works. and when the workers actually DO real quality work.
let them go to india and china. once they realize that cost savings is not all there is, they'll be back.
perhaps they need to truly learn the value of having us, the US born workers who know this country and how to get things done, be in their employ.
I hope more companies do 100% offshoring work.
they will learn that its not all roses.
I think we need to experience more pain (damn) in order for us to get back what we all lost. and we ALL did lose; because if it did not happen to you yet, it will; and it most certainly is happening to people you know.
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"It is now safe to switch off your computer."
It's a nice try - but it'll NEVER pass much less get signed by Oblahblah! Too much BIG $$$ in politics! Politicians ONLY listen to $$$!
The Truth is a Virus!!!
Here is my experience interning with a big American dotcon whose name starts with letter G 5 years ago: Truckloads of Russian speaking product people with minimal technical literacy and only basic knowledge of English supervising B visa temp "consultants," who themselves supervised offshore sweatshops. My work there was to be a "technical interpreter" while I was originally told that I will work as a "developer mentee." I got an impression that most of "developers" in American "Big IT" are just glorified product and project managers overseeing overseas coding sweatshops. The very few who did code, were basically gluing big chunks of code prepared for them overseas and working with high level SDK libs.
Your example is a perfect example for unintended consequences of each and every government's decision.
I can give one more example. There may be some bona-fide less desirable locations with low wages, that do have difficulty attracting qualified personel. This will be a burden for some organization in the midland of America trying to hire a skilled worker.
That being said, every law will have consequences, the outcomes that the politicians would not want to think about it. Here are the few: the limit of $100K does not appear to be indexed to inflation. Which means that in a decade the new limit of $100K will become what is now $50K.
As others already mentioned, some jobs a highly telecommutable. IT, accounting, calling centers are frequent examples, but there are many more. Because of never ending increases in taxes (local property taxes), workers demand 2-3% annual raise, annually compounding corporate costs. Basically, because of the increasing taxation and now mandatory health tax increase (wait for 2017 enrollment period), more companies will be looking for ways to cut the costs and will outsource the jobs.
Even president Trump with his promises will not be quick to help.
Finally, US will become less desirable destination to study. Which is a good thing, of course, because it will help to prick current US study cost bubble, as less foreigners (paying full price) will come to study to the USA.
All in all, increase is probably a good thing. However the blowback will be very different from what people expect.
Just make two simple reforms:
*) H1B visas convert to Green Cards after two years.
*) Limit them to no more than 5% of the workforce for any work site.
Offshore has always been cheaper than H1B onshore. If it were possible to make it work with 100% offshore, then it would have been done already.
Howsabout forking out $60 K to Amercicans, rather than to foreigners?
I'm not repeating myself
I'm an X window user; I'm an ex-Windows user
OK, so then why are they doing that now for the remaining 50% of their US workforce? What you say suggests that they would benefit even more right now from moving everything offshore.
Our government doesn't even enforce our current laws on H1B, what good would new ones do? A few months ago I got a "form letter" denial for a support job I applied for, didn't even get an interview. I had worked with this team for about three years, I knew their applications, escalation lists, support teams, ticketing system; in some ways I probably was more qualified than some of their current staff members. I was told by their management that they had zero actual control over HR's initial acceptance / cut system as all of the HR people are in another state thousands of miles away; HR (by unofficial policy) wouldn't take any local suggestions for who would be interviewed...the "process" didn't work like that. "The process" had HR giving them a list of pre-approved candidates, then HR would allow the local staff to interview them, and then HR would take it from there. After I got my form letter of rejection, I found an LCA for my job had been filed within a few days of my application. Using various H1B "job sites" in conjunction with the Department of Labor's LCA system, I found dozens of jobs in my area that never had any advertising on any job board, nor had any recruiters been contacted. These jobs went straight to H1B, they didn't even bother looking for a US citizen.
Most frustratingly, there is no one to really complain to, no regulatory agency that will listen. Even when the law is broken...until it gets to the level of a Congressional hearing nothing is done. Even then, nothing happened to Disney, or SEC, or any of the other giant corps. A few donations to re-election campaigns via shadowy 501s and the issue is dropped every time. Sometimes I think the only solution is to destroy the staffing corps pushing this, and by that I mean literally set fire to the US locations of companies like Tata and Infosys.
It's odd that the richest person in congress would put forth this proposal. It's true that he has a democrat joining in the bill, but what's in it for him? There must be something evil hidden in the text that we haven't discovered yet.
...omphaloskepsis often...
This comment won't address the low-cost labor question. It will cover the on-vs-off shore question.
About 12 months ago, we benchmarked the Silicon Valley vs Bangalore salaries that we have across a 200 person organization.
- Architect Level engineers had a fully loaded cost about 1/2 of the US engineers.
- Mid-career enginers were about 1/3
- Junior engineers were about 1/5 the cost.
General salary increases in Bangalore are about 10%, US (and most western countries) is about 3%. Cost of living in Bangalore is generally a lot lower than Silicon Valley. The upshot is that senior engineers have a considerably better deal in Bangalore than Silicon Valley. In about 5 years, a senior engineer would have very different motivations for entering the H1-B game to get to the US. It's likely better for Silicon Valley to in-shore to a cheaper US geography (if there are sufficient skilled engineers).
Most H1-B holders are also in the green-card process which skews things quite a bit. For those that aren't current, there is about a 5-8 year wait. When you are in that situation you need to be careful about transferring roles. However, most of the H1-B's that I have worked with are *NOT* underpaid, and are generally quite skilled. I'm not saying it doesn't happen, but I haven't seen a grand conspiracy within the large companies I've been in. The engineer screening, interview and offer process is definitely not biased to "cheap labor".
China has already priced itself out of the market as a low cost engineering center (unfortunately the West trained them well enough when they were cheap that now they can generally compete on engineering prowess with the rest of the world).
Make it direct pay as well so there can't be kick backs from staffing firms where on paper the works are being paid a lot more then they are really getting.
Do-nothing Darrell Issa is NOW concerned about H1B abuse, because people in his district (a high-tech hotbed North of San Diego) have been having their jobs overtaken by imported, lower-cost workers...conveniently, just before his performance is questioned by challengers for his Seat in the House of Representatives.
He could've done this anytime in the past two (or four) years, but, no-o-o. He waits until he can make it a CAMPAIGN ISSUE to help his faltering reputation. His Democratic challenger is now approaching parity in polling, so, pull out the project he SHOULD have been working on for the past several years in office. But, schemer that he is, he's held it in reserve until it could save his butt...and he hopes you forget about all the butts of working who've lost their jobs because of his passive attitude toward constituents in prior years!
Step 1) create 150k new job opportunities for American citizens by reducing the number of H1Bs by 150k.
Step 2) auction off the remaining H1B slots so companies who truly need exceptional skills can get them, but at a market price
Agree completely, but then they location-shop before body-shopping.
Problem I have is small companies and other fields. I am in architectural empngineering, and there really are limited grads. We were willing to sponsor one person over the past decade, but the salary would destroy it. (He had one year of "internship" and would be starting around $65k in Los Angeles.). Worth it in the greater good, but a challenge none the less.
get rid of the tied to the job part and force OT pay for H1B's
H1-Bs are supposed to be highly skilled. I live in the Detroit Metro area. 60k is what you pay a fresh college grad with a STEM degree, even in Detroit.
. . . IT and private industry that misuses the H1B system. In Monterey, CA there’s a school called Defense Language Institute (run by Uncle Sam himself) that employs a boatload of H1B visa holders and they are being treated very poorly in both pay and work conditions. That is, our own government is breaking the law with regards to H1B visa holders, so please don't expect them to fix it. Apples to Apples, the DLI worker works twice as much for half the pay compared to other colleges in the immediate area. God forbid one of their H1B visa holders gets uppity, they'll be summarily shipped back the very next day at the worker's expense. Monterey is a really expensive place too, and I have witnessed 50+ year old professors working 60 hours week year round living in poverty. Yikes!!!
I believe that in order to make it a lasting reform is to make the minimum for foreign wworkers a percentage above the local standard industry wage. This would ensure they actually TRY to find a local professional instead of saying they did and replace all the employees with cheaper foreign labor.
65k is princely in other parts of the country. Is the cost of the loss of in person business meetings so high, that the value of a telecommuting architect is totally lost?
Your applicant does not need to be local. Just easily able to collaborate. It may seem strange, but there really is high speed internet, and people interested in becoming architects in the flyover land parts of the country, where costs of living are much lower, who would be willing to work for a much smaller wage than could be offered with a straight face anywhere on the coasts. People here routinely live on 30k a year. Dwell on that.
The major obstacle these days is the office politics. The "need" for people to stand at attention when called into a room, and waste an hour or more listening to a poorly made powerpoint presentation about keeping the break room clean, or whatever other office politics shit has necesstated such a meeting. I work in aerospace. Most of my contacts are communicated with via email. They could be anywhere. As long as they respond promptly, and reliably, they could very well be on the moon, and I could still get my work done.
There is no compelling reason for white collar work in the age of instant digital communication to be shackled to a specific location. That includes architectural firms. They can send you lovely proposals digitally. They don't need to be there in person, unless you value grandstanding in the boardroom over actual architectural ability. If thats the case, hire salesmen, not architects. They specialize in selling iceboxes to eskimos.
Your inability to find somebody to work at below 60k/yr at entry level in your area just means you need to consider telecommuting, or branch offices. It does not mean you need to jam foriegn workers into the local labor pool, and drive up local costs of living even higher, just so that they can fill a seat in person.
architectural Engineering. A starting electrical engineer with a Masters is around $60-65k in Los Angeles, more in Bay Area. Junior staff cannot be effective remotely; they do not work independently for a few years, and when they hit that mark they need to be helping to mentor the next generation.
Senior engineers can be remotely with only limited loss in productivity, and mid-level can safely be remote a day or two per week. We do have a remote office, as well as one full-time remote employee. It works very well for some things, but going for a job survey on a day's notice is a little hard when you are a thousand miles away.
We can find plenty of people, at salaries we are quite comfortable with. It is important to understand the cost of bringing one employee on board through the first few months of work though. It is rarely less than $50k, and often double or triple that for senior staff.
As for flyover country, grew up there, went to school there, always happy to hire from there. Not especially interested in hiring people living there that can only be productive for 65% of tasks though, even if it is at a 50% salary discount. Too many additional costs that direct salary don't reflect.
I seem to recall reading here about a study finding that ~90% of H1-B visas were given to people taking low-skilled entry-level positions. Are they really being paid $60k/year for that? Either entry-level IT positions pay way better than I remember, or something else is going on here.
Corruption is convincing someone that the selfless ideal is the same as their selfish ideal.
Those who claim the US benefits by draining the best and the brightest from around the world are doing two things wrong:
1) They bad liars. Everyone knows they just want cheap labor. Just cut the noise already and accept the fact that they may have to send some mangers overseas.
2) Even if they happen to get someone particularly gifted to leave their native land and work cheap in the US, they're ignoring the negative impact this has on those -- usually developing -- economies which need their best and brightest in order to grow their economies to become importers of US goods and services.
Seastead this.
Unless your 50% American workforce is all H1B workers, I don't think you understand this bill at all.
In this case, there is no counter-benefit to the trade, other than "inexpensive purchases", without a subsequent offsetting or balancing return transaction. Tariffs and excise duties help to balance out these kinds of inequalities, and help to artificially secure such comparative advantages, where otherwise it would be impossible to sustain them.
The goal of a tariff is not to squelch foreign products in the market. It is to ensure that the domestic products remain in the market, and continue to be produced by the country engaging in the trade. The counterpoint to the principle thesis of the theory of comparative advantage is that a country that is very prosperous, and able to supply itself with any and every good conceivable in a more efficient manner than any other nation it could trade with, will still engage in trade-- is that countries that are less capable of producing goods, still produce goods to trade to the more capable country.
The US produces fewer and fewer trade goods, and consumes more and more trade goods every year, and with it, employment (and financial liquidity) decline, and with those, standard of living declines, or at least progresses at slower and slower rates.
Again, the goal of a tariff is not to completely squelch the flow of foreign trade goods--- Foreign trade goods enrich the local market by leveraging the creativity and resources of other nations, allowing the local consumers to benefit from other country's advances as well-- The goal is to ensure that local production CONTINUES.
Now, are you satisfied, AC?
It sounds like your rates in your high cost areas are not congruent with the actual costs of operating your business.
Since you are doing surveys for new building constructions, and other essential civil engineering services for the locality you service-- remind your local civic authorities that lowballing you will result in their deadlines not being met, because you cannot keep the staff required to service their needs in a timely manner on the rates they are demanding. Your competitors will likewise be unable to meet these demands placed upon you, because the demands are unreasonable.
Costs for certification and services rendered need to reflect the actual costs (including labor) of those services, otherwise business is not sustainable.
I feel like lots of people here are seeing only one face of the H1B program. I got hired as an H1B and I am permanent resident now. Though I entered the US on a J1 program. When I entered the US, I did not even want to stay, then life being life, I decided too. I work for a university and there are not many qualified applicants.
It is very unlikely that you would someone that is skilled and permanent resident or us citizen for a professor position. They pretty much just do not exists. There are some, but not many and definitely way less than opened position.
I can understand that there may be issues in the H1B program. But there are legitimate use of it as well.
That's the textbook goal of a tariff. Countries have used tariffs to effectively shut off imports.
Tariffs also only work if the imposing country has a significant advantage. It's possible to vastly overdo them, as the Smoot-Hawley Tariff Act did (trade dropped by half in both directions). In a global trade era, the effect of tariffs against a given country can be quickly countered by that country offering more advantageous trade opportunities to other nations. China could offer more generous status to the EU, for example, which would probably be quick to accept lower cost imports as a potential boost to its own lackluster economy.
Trade wars benefit few, and rarely end up with the imposing country getting its entire way. As time goes on and trade becomes even more globalized, I suspect that the imposing country will more often be forced to offer significant concessions to get out of the trade war. Eventually, free trade zones the world over will be the rule. Whether that's good in general or not, I don't know.
You can never go home again... but I guess you can shop there.
Who ever said, "The high-skilled visa program is critical to ensuring American companies can attract and retain the world's best talent" is a god damn lair. Its about money. Public record shows it.
There's no fallacy of appeal to authority here, for two reasons. The fallacy of appeal to authority would be citing Michael Jordan's opinions on DNA editing, or Kaku's style preferences. It has the form:
Proposition A must be true because person B says it is, and person B is authoritative in some field (but not the field in question).
GP says "for more details", listen to Kaku's explanation in the video. There's no claim that Kaku must be right because Kaku is Kaku. Rather, Kaku explains and supports his position. The reader is encouraged to listen to Kaku's arguments, not assume that Kaku is always right.
Secondly, the H1B program was *designed* to allow world-class people, top scientists and the like, to work in the US. Michio Kaku is a top scientist working in the US. Therefore he can be expected to have legitimate insight into the potential effects of losing his Nobel-winning colleagues to other countries. On the topic of eliminating the H1B program rather than fixing it, and therefore losing top scientists, Kaku does in fact have knowledge and experience that most of us don't have.
They amount to de facto indentured servitude which the US constitution bans.
putting the 'B' in LGBTQ+
I've lost count of the number of times I've gotten letters from HR after discussing raises detailing (in words, not actual $ values) how my pay is so much more than what shows up in my bank account. There's the paid vacation time, how much they pay toward my insurance, sick days, other benefits I have absolutely no use for (but I'm sure someone convinced the company that for $X, they could claim it was worth $Y).
Unless this bill says the H-1Bs are to get $100K (before taxes) in actual spendable money without counting any benefits toward that amount, it's just going to end up in a whole lot of gym memberships (as an example) in other states (to prevent actual use) "worth" $20K/year costing the companies $500/year.
If they can pull this off, there may be some minor uptick in outsourcing, but there are still a lot of very insecure, untrusting, upper-level managers who want there to be a person they can physically get in the face of when they want to exert a sense of control. I note the continued resistance in businesses to institute telecommuting practices.
listen to Kaku's explanation in the video.
This country (and apparently everyone else's) has a terrible aliteracy problem. There's hardly any illiteracy, but the last I read, only something like 3% of Americans read a book last year.
I for one do NOT want to see a talking head. A video that actually uses the video to demonstrate something is fine, but I can read five times as fast as you can talk and get a hell of a lot more out of it.
Free Martian Whores!
So, let me get this straight AC--
A country that imports more than it exports is "Great!" in your estimation, and pointing out that the actual quote from ricardo concerning his theory is as follows, with a little added emphasis of my own:
[blockquote] ... but only left to find out the way in which it can be employed with the greatest advantage."
"If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them [b]with some part of the produce of our own industry employed in a way in which we have some advantage.[/b] The general industry of the country, being always in proportion to the capital which employs it, will not thereby be diminished
[/blockquote]
Note, his thesis does not work at all when the bolded part is not met.
While the US does have the second largest export market, A significant proportion of the US's labor force is not tied to manufacturing or exports, most of it is service industry. Further, the manufacturing capacity of the US is currently struggling.
http://www.reuters.com/article...
Reuters attributes the low manufacturing performance to a high valued dollar, and low oil costs (globally)-- resulting in labor for manufacturing being too expensive in the USA-- THE EXACT THING WE HAVE BEEN TALKING ABOUT, and that tariffs are intended to help avert.
Their opinion is not alone-- The economic policy institute has a rather lengthly report about it.
http://www.epi.org/publication...
To which they credit " nearly two decades of policy failures that have damaged its international competitiveness" as the primary causal factor behind the massive reduction in US manufacturing. What policy decisions have been enacted in the past 20 years? Various free trade agreements that removed trade tariffs.
It further states that manufacturing accounts for only 8.8% of the US's labor force. Meaning that most americans are not employed doing manufacturing, but in some other industry.
Yet somehow, despite the massively disproportionate segment of the US labor force that is allocated to service providing, industries seeking service workers (No, software is NOT a manufacturing job. it is a service job.) "Simply cannot find qualified applicants!" Perhaps we aren't training enough people to meet those needs? No-- the NYT seems to feel otherwise.
http://www.nytimes.com/2012/04...
The costs of attaining a college degree are spiraling out of control, while the benefits of getting one diminish, due to labor force saturation. This is because there is out of control demand for college education, coupled with lackluster pay once it is attained. Basically, the service industry in the US does not want to pay for the education requirements it is demanding, and is leaving hopeful applicants holding the bag.
Instead, the service industry leadership wants only the cream of the crop, so to speak, of the potential applicant pool. It demands only the very finest caviar, and wants to pay cheesewiz prices. (Why not, it can get caviar for the price of cheezewiz elsewhere!)
This comparative difference in labor rates is ALSO controlled innately by tariffs, and prevents this kind of labor shopping-- at least as far as outsourced labor is concerned.
Now that I have buried you under a pretty substantively sized wall of text with some citations and opinion pieces by bonafide economists, perhaps you can be a little more forthcoming in how my interpretation of your rhetorical question is so clearly "Wrong", yes?
On the contrary.
If you properly impose a tariff, which includes yearly limits on quotas of imported goods, you put the imported good artificially at the same or very similar market price as the locally produced product.
EG, in your example of 4$ per pound cotton textiles, the government artificially raises the price of that import via the tariff, making it say-- 19$ per pound once it gets to the market.
People don't stop wearing clothes just because the price goes up. Instead, they start looking more strongly at quality. They don't have the disposable income (everything costs more) to waste on crap clothing that they have to replace every year. Instead, they see the value in purchasing the clothing made with the higher production quality that lasts longer, This increases the demand for the higher quality product, and with increased demand, go increased opportunities for investment--- aka, JOBS.
Two instant solutions:
1) Remove H1B program and replace it with green cards. Most of H1B employees get green cards eventually anyway. If visa holders don't depend on company like they currently do, if they can change jobs at will, they have no reason to accept sub-par offers. One may do an investigation for what money green-card lottery winners work. I really doubt that they work for pennies H1B employees get.
2) As there is more demand than allowed visas, there is some kind of lottery. Instead of lottery, give visas to companies that plan to pay the highest salaries.
No sig today.
Sorry to hijack a story to go on a tangent, but this may be one read by people I'd like to query:
I'd be very interested to know how older (35+) IT workers (ops & dev) in the UK are feeling at the moment, eg:
* My long experience gives me more confidence in my employability
* I've kept up with trends, so I'm OK
* My experience counts against me (eg "you know C", "you know UNIX", so you must be past it)
* My age counts against me
* There are no jobs going for my skillset
* I'm doing fine, thanks!
* Jobs I can do standing on my head don't pay enough
* Where I choose to live (family or other ties) are scarce/don't pay enough.
* I'd move for a job
Please give some additional details if you reply. (yes, I do employ!)
H1B was originally intended for extra-ordinary professionals like Albert Einstein and Linus Torvalds and NOT for http://sammyboy.com/showthread...
Casteism
*) Impose tax on income, not profits for companies that hire H1B
Casteism