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Cringley: H-1B Visa Abuse Limits Wages and Steals US Jobs 795

walterbyrd sends this snippet from an article by Robert X. Cringely: "Big tech employers are constantly lobbying for increases in H-1B quotas citing their inability to find qualified US job applicants. Microsoft cofounder Bill Gates and other leaders from the IT industry have testified about this before Congress. Both major political parties embrace the H-1B program with varying levels of enthusiasm. Bill Gates is wrong. What he said to Congress may have been right for Microsoft but was wrong for America and can only lead to lower wages, lower employment, and a lower standard of living. This is a bigger deal than people understand: it's the rebirth of industrial labor relations circa 1920. Our ignorance about the H-1B visa program is being used to unfairly limit wages and steal — yes, steal — jobs from U.S. citizens."
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Cringley: H-1B Visa Abuse Limits Wages and Steals US Jobs

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  • Probably true ... (Score:4, Insightful)

    by gstoddart ( 321705 ) on Friday October 26, 2012 @03:13PM (#41781443) Homepage

    There isn't a shortage of labor, there's a shortage of cheap labor.

    Industry just wants to keep making massive amounts of money, but pay their staff less than the salaries the market created.

  • by Anonymous Coward on Friday October 26, 2012 @03:13PM (#41781449)

    This article fails to even mention that H-1B visas are dual intent - green card applications are common for H-1B visa holders, and many large tech companies encourage green card application as an employee retention mechanism.

  • I'm surprised (Score:5, Insightful)

    by koan ( 80826 ) on Friday October 26, 2012 @03:14PM (#41781463)

    That this isn't common knowledge, corporations are trying to return us to 1800's regulation, it isn't just the H1B's, it's every facet of the larger corporations.

  • by Anonymous Coward on Friday October 26, 2012 @03:16PM (#41781483)

    what is the average H1-B wage?

    I don't think H1-b workers are cheap, plus the Visa+lawyer fees

  • Immigration Is Good (Score:5, Interesting)

    by GeneralSecretary ( 1959616 ) on Friday October 26, 2012 @03:16PM (#41781487)
    If they weren't working in the US they would be doing the same work for US companies overseas. Visas allow the workers to work here where they also contribute more to the US economy as well as US society. They might also start companies and create jobs. True, wages may fall in the short-term, but having a larger educated and working population will help us in the long run.
    • by gstoddart ( 321705 ) on Friday October 26, 2012 @03:21PM (#41781539) Homepage

      They might also start companies and create jobs. True, wages may fall in the short-term, but having a larger educated and working population will help us in the long run.

      Not really. Under the visa, they can only stay a few years.

      In the long term, you're training foreign nationals to do your jobs, and then take that knowledge with them.

      Competing with India for wages in the long term is a losing proposition ... they have vastly more room to go up, than you do down.

      I'm willing to bet of the 500,000 or so tech workers with H1B visas, there's almost as many of your own citizens in the same field who are out of work. This is just a cheap labor pool for corporations, and short term benefits.

    • by aeortiz ( 1498977 ) on Friday October 26, 2012 @03:33PM (#41781721)

      Visas allow the workers to work here where they also contribute more to the US economy as well as US society. They might also start companies and create jobs.

      I agree with General Secretary.

      Anecdotal evidence:

      I'm a Honduran who won a college scholarship to study in the US, but forced to return to Latin America immediately after graduation (1998). I now live in Mexico, and work as a consultant. Often I'm hired to do work for US firms, and am paid less than half of what I would be in the US. But since this is Latin America, these wages let me live comfortably in the middle class.

      I've since got my master's degree, and dream about starting a company someday. But I hesitate to return to the US. If I did, because of my ethnicity and birth country, many would think I stole their job. But isn't the US a meritocracy? What about the American dream?

  • Puzzling.. (Score:5, Informative)

    by xtal ( 49134 ) on Friday October 26, 2012 @03:20PM (#41781519)

    I'm a Canadian, and I guess, a reasonably talented EE. One avenue not mentioned is the TN-class visa; same general idea, but yearly renewable. (Canada/Mexico)

    The process to actually _immigrate_ to the US is a real pain and very lengthy. So much that the logical extension is that they don't want skilled immigration on a permanent basis - at least from Canada. However, exporting work from the US is made very easy.

    What's the problem with opening it up? Why not just find a way to document, all the undocumented? Am I missing something?

  • by Anonymous Coward on Friday October 26, 2012 @03:20PM (#41781531)

    For the software industry leaders, H1-Bs are used for bringing in MSc's, Ph.Ds, and other top talent from other countries. Ordinary IT jobs aren't at stake because that type of job is beneath them.

    • by Ossifer ( 703813 ) on Friday October 26, 2012 @03:37PM (#41781777)

      I have worked in the software industry since 1984. Not once did I meet an H1-B who was MS, PhD, or other top talent. Every single one of them has been ordinary software engineering jobs. I have witnessed how companies make fake jobs ads that cater to the specific person, and HR admitting they automatically pay H1Bs $10k less because they can...

    • Re: (Score:3, Insightful)

      For the software industry leaders, H1-Bs are used for bringing in MSc's, Ph.Ds, and other top talent from other countries. Ordinary IT jobs aren't at stake because that type of job is beneath them.

      Incorrect. I got into the US on a H1B for web development work and I only have a bachelors. And while my starting wage was nothing special (I was 26 at the time), it grew soon enough to the point where I'm now earning above the market rate for the work I do and I'm a green card holder, eventually I'll be a citizen. My employer and I spent a fortune on lawyer's fees and it was an enormous hassle for him and for me.

      This is not about "slavery". This is about finding the right talent for the job. And no, ther

  • by e065c8515d206cb0e190 ( 1785896 ) on Friday October 26, 2012 @03:23PM (#41781571)
    This is a recurrent topic on Slashdot. I will not pretend I know how it's done in every single company but, as an H1B I have:
    - paid the same amount of taxes as citizens in my company - had the same wages (even higher actually) as citizens - had the same access to healthcare as citizens - created an extra legal cost to my employers for maintaining my immigration status - not worked more (at least hours-wise) than citizens

    The BLS (bls.gov) regulary publishes a list of the jobs with the most potential on the market. There is a lack in STEM. It's a fact (unless BLS is conspiring against the people, this is Slashdot after all).

    In my field there are roughly 20% of citizens that fill positions, in any given company. Not sure why. Maybe head over to the engineering department of a big university and see who's attending and getting top grades. You have a sh*tton of people from Western Europe, Eastern Europe, Asia, and also now Latin America, working their asses off. Not many Americans... no they're all at the Business School learning 1- blah 2- blah 3- profit. Let's fix that first, then complain.

    signed: former H1B, now permanent resident, one day citizen

    Oh, and obligatory: "I took yer jerb".
    • by Peter Simpson ( 112887 ) on Friday October 26, 2012 @03:41PM (#41781837)
      Not *every* company using H1B is doing it for evil reasons. But some of the larger ones certainly seem to be. I have seen "help wanted" ads posted looking for Masters' degree in Comp Sci with some extremely specific qualifications and ridiculously low salary. I refuse to believe that there are not any US citizens who could do that job. I doubt anyone who went through a US university could afford to take it, though.
    • STEM == science, technology, engineering, and math. I loathe that acronym. There is next to nothing a string theorist, a java applet programmer, and a wildlife biologist have in common but we get lumped into the same STEM group. There might be a shortage of java applet programmers. I don't know, I'm a biochemist. However I do know that for those of us in the "S" portion of STEM the job market is horrific.
  • by srussia ( 884021 ) on Friday October 26, 2012 @03:24PM (#41781587)
    Wage arbitrage now was caused by labor mobility barriers set up in the past.

    Lesson: Don't set up a large potential difference if you don't want to get a big shock arcing through down the road.
  • by the eric conspiracy ( 20178 ) on Friday October 26, 2012 @03:25PM (#41781597)

    The problem is that if you don't grant H1-Bs the companies will pretty much move operations offshore if they are large enough to support that sort of operation.

    With H1-Bs you at least keep the tax revenues in the US.

    The *really* bad aspect of this is that it weakens US educational institutions. With these people coming into the US it discourages US citizens from going after these sorts of technical degrees in the US. That's got all sorts of negative effects.

    Perhaps one sort of H1-B visa that would be less damaging overall is the type that is granted to foreign students holding a degree from a US university.

    • by godrik ( 1287354 )

      (disclaimer: I am working in the us on a J1 visa.)

      There might be a vicious cycle with visas. But I am really under the impression that most visa are issues because one could not find a local ( == US) worker to fill the position in. As far as I can tell, it is because the education system in the US sucks so much that so visa are issued.

      Now I can see your point : if there were less H1B, there would be more incentive to fix the mess. But exactly how many "opportunities" would the US miss if it was not hiring s

      • Re:H1-B (Score:4, Informative)

        by Red Flayer ( 890720 ) on Friday October 26, 2012 @04:50PM (#41782799) Journal

        But I am really under the impression that most visa are issues because one could not find a local ( == US) worker to fill the position in.

        That's the official line. In fact, for many temporary visas, that's the only reason the visa will be granted.

        But in actuality, it's not the case. The truth is that by increasing supply of qualified workers, companies can keep the price for those workers low. Basic microeconomics at play.

        In my experience, the way it generally works is that the largest H1B-using companies actually provide the training necessary to meet their requirements via either related parties (offshore affiliates) or outsourcing firms. Then, because they haven't trained anyone locally in the skillset they need, they get those employees to come here under H1B.

        Basically, instead of investing in the training in specific skills in local employees, they do so overseas. Then we watch those skills go back to the employees' home country with them.

        I believe we need to increase the standard of living across the globe wherever we can. But I do not believe that companies allowed to operate in a certain country should be allowed to get away with not investing in the workforce of that specific country when they need skills there.

    • The problem is that if you don't grant H1-Bs the companies will pretty much move operations offshore if they are large enough to support that sort of operation.


      Except the part about being large enough. A company doesn't have to be large to off-shore. It is routine now for startups with fewer than 20 employees to have half of them off shore. Many VC's impose an off-shoring strategy as a pre-requisite for getting funding.

      Frankly, complaining about H1B's is fighting the last war. If a company uses H1B's they will hire fewer Americans but they will hire some and even the H1B's contribute to the local economy. If they off-shore, no Americans will be hired an

  • by crazyjj ( 2598719 ) * on Friday October 26, 2012 @03:26PM (#41781605)

    H1B's are not only artificially driving down wages and generally screwing over American programmers, engineers, etc., but they are also a blight on the job market for another reason: fake jobs.

    There are a LOT of fake job ads are out there right now that employers are only posting so they can run crying to Congress and the Labor Dept. later, claiming that they can't get enough "qualified applicants" (and to beg for more H1B visas). You know, that ad that asks for a programmer with 20+ years of Java programming experience, or with qualifications so specific that it HAS to be tailored to a specific H1B candidate, or that asks for an experienced programmer with a salary range of $30,000-$35,000, or that never seems to get filled no matter how many qualified people apply? These are the jobs that colleges cite when they try to sucker in new programming and CS students, that applicants waste valuable time and effort on, and that create an artificially rosy appearance of the technical job market. They make it look like there are way more jobs than workers out there (that's what they're designed to do), when in reality the REAL job market is a lot more dismal, especially for newbies. They're a blight for honest job seekers, and a tool for the dishonest to use to con Congress, the Labor Dept., and desperate potential students.

  • by MickyTheIdiot ( 1032226 ) on Friday October 26, 2012 @03:29PM (#41781657) Homepage Journal

    It's is a real uphill battle for congresscritters, especially the long time reps, to understand this.

    Post WWII until maybe mid-80s I think it might have been a valid belief that doing whatever helps the biggest corporations will automagicly help the economy. I think high speed communications invalidates this idea completely.

    In other words, it used to be that if a company grew that it would force them to help the individuals that needs jobs. If that ever was the case it isn't so now. So pouring money and tax breaks into a big company does nothing but enrich the few people at the top of that chain because they can just as easily hire someone offshore.

    I don't think people in Congress understand this. And it extends to H1Bs, because if they get the "smart" immigrants then it means more domestic jobs under similar logic. I think many reps in Congress probably want to help their local constituents but haven't been able to break out of this logic. Look at how dumb our legislation with tech is... it falls in the same category of ignorance.

    Again, I think there are some that just don't care if they are helping normal joes or not. Personally I thin Romney falls into that camp.

  • What about higher COSTS for business which get passed on to ALL consumers? And don't cry me a river about corporate profits as I suggest you go look to see what is in your 401k or other retirement plan - public or private. The sad reality is that the US can no longer command the wages it once could, whether thats in tech or in digging ditches.

    • by s73v3r ( 963317 )

      Boo fucking hoo about costs. You and I know that they do not reduce prices when costs go down, unless they absolutely have to.

  • by hessian ( 467078 ) on Friday October 26, 2012 @03:34PM (#41781727) Homepage Journal

    I know this is an unpopular topic, but I see that throughout history that diversity -- of any form: religious, ethnic, cultural, racial -- has failed wherever it has been tried because it offers people a choice between having no culture or being ostracized for maintaining a cultural identity.

    Immigration seems to be popular with the construction industry, cheap labor employers, and serf-masters like the big Silicon Valley companies. Cheap lawn mowing and cheap software production are high on their agendas. However, it's not really working in that this country continues to have clashes between value systems, including those rooted in culture, and increasingly, between our lack of values and anyone who does have cultural values.

    Can anyone name a time and place in which diversity has thrived? It seems like all of our accounts come from a couple centuries later when the experiment has failed, and left behind a culturally-confused third world nation.

    Perhaps instead of just walking lock-step with the rest of the herd, we should think independently about this issue, and unlike the rest of our society, question whether it's a good thing at all.

    • by medv4380 ( 1604309 ) on Friday October 26, 2012 @04:18PM (#41782359)
      You're painting with awfully wide brush strokes there.

      I see that throughout history that diversity -- of any form: religious, ethnic, cultural, racial -- has failed wherever it has been tried

      When, and where throughout history? I can site at least 1 case where the lack of diversity was the cause the the collapse of a nations economy. France under Lois XIV under their "everyone must be Catholic" logic ended up convincing a large portion of the educated to leave the country. That lack of diversity caused a brain drain that helped to cause the financial collapse of the entire country.

      The very nature of Diversity means that it will not last for long unless you keep importing it. Best example of that is China. You can go ahead and conquer it, but in a few generations your decedents will be Chinese.

      Uniformity has advantages in getting everyone on board and headed the same direction, but it also has weaknesses and doesn't adapt to new things quickly. Diversity is a very good environment for creativity, but also has the drawback of generating strife between different groups. Nether solution is ideal, but that's life.

  • by parallel_prankster ( 1455313 ) on Friday October 26, 2012 @03:35PM (#41781757)
    Is anyone really surprised with this report? I know people who have worked as "contractors" with H1 B and if you ever see the way these IT contracting companies exploit the system, you will be shocked. It is a machinery in place in pretty much all of California and North East where folks that cannot get jobs here apply. Once they get in, they are given a quick training on some IT stuff and then their resumes are modified to make them look like "experts" in that area. After that they are fitted into companies mostly banks in NE and big companies like Cisco/IBM ( because there they are just 1 in a hundreds of thousands of employees and no one cares how they got in.) by way of contracting. Half of their pay is docked by the contract firms as part of the agreement and they are not given any health benefits. But hey, with even what those people make, they somehow still survive. They would rather be here than go back!
  • by Baldrson ( 78598 ) * on Friday October 26, 2012 @03:36PM (#41781763) Homepage Journal
    The solution to the H-1b abuse problem is to simply evict corporations from the US. Outsource not only IBM's programmers, but their entire executive suite and board of directors. The political zeitgeist of immigration is basically that no nation has a right to its territory when there are people elsewhere -- even if numbering in the billions -- that want to "seek a better life". Why not take the "better life" to them where they live? GIVE them IBM, HP, et al and good riddance.
  • by popsensation ( 1405041 ) on Friday October 26, 2012 @03:37PM (#41781773) Homepage
    I disagree with this article. I believe there a shortage of developers. I know there are cited studies but in my experience there is a serious shortage of developers in the USA. Being part of the industry for ten years now I've never seen a time where a developer was unemployed for any reason other then personal choice. Tucson, for example, has been steadily adding/employing about 100 additional programmers each year while graduating 90 (most of whom immediately relocate). High paying software jobs sit unfilled for months, in some cases years at Ratheon, UofA, IBM, and many more places.
  • by 140Mandak262Jamuna ( 970587 ) on Friday October 26, 2012 @03:41PM (#41781833) Journal
    It is definitely true H1B visa reduces the wages in USA. But, it is too late to close the barn door because the horse has been stolen already.

    Before the global infrastructure built up, before so much of investments were made by big companies in India, before many mid level execs have hitched their wagon to the out sourcing horse (which was stolen from the barn mentioned earlier), it might have been possible to reduce H1B and kept the job in USA.

    But right now, if you reduce H1B, it is going to move the whole damned job to India. At least they (or us, because I am an ex H1B) work in USA, pay taxes in USA and spend most of their money in USA and save and invest in USA. The outsourced job lives, spends, invests and pays taxes in India.

    I ran the rat race in India, and won it. And the prize was US Citizenship. I don't want my daughter fighting for jobs with the next generation of me who wins the rat race in India. But that makes me sound like the guy who dynamites the bridge after crossing it himself. This is quite complicated.

    As Obama said in the third debate, "Some jobs are not coming back. They are low wage low skill jobs. I want high wage high skill jobs here", it would be great if we could make sure the jobs that were lost are all low wage low skill jobs and keep the high wage jobs here. Even if that means my daughter has to fight with the next generation rat-race winner from India.

  • Increase the amount of Payroll taxes charged to non-citizens (and include the Employer Portion with this) of course you will need to ramp up the numbers over say 5 years but your EndGame is

    15% of workforce Non-Citizens= 130% of Base Values
    17% = 140%
    19% =150%
    21% = 175%
    22+= 180% + 2% for every percent above 22

    this will have 2 benefits

    1 this will raise Massive Amounts of Money
    2 Companies will get very creative in employing LOCAL folks

  • by J'raxis ( 248192 ) on Friday October 26, 2012 @04:17PM (#41782353) Homepage

    ...wages are artificially high in the United States and only maintainable at that level when the government limits foreign competition.

    The H-1B program should be abolished---and along with it, the government's power to prevent anyone, citizen or foreigner alike, from working here if they choose.

  • Nonsense (Score:4, Insightful)

    by Charliemopps ( 1157495 ) on Friday October 26, 2012 @04:25PM (#41782455)
    Our best coders are all from India. They run circles around our in-house guys, including me. Anyone that's willing to come to this country, work hard, not break the law, and contribute to our country should be allowed to do so. The shame here is that they are getting Visas instead of citizenship. WE are robbing India of their talent... not the other way around.
  • by hpj ( 26910 ) on Friday October 26, 2012 @04:32PM (#41782545) Homepage

    As a long time H1B holder I am a bit offended by the article and there are quite a lot of inaccuracies.

    * The people that I know who have H1B visas both at my company and others are definitely not scraping the bottom of the barrel wage wise.
    * To get an H1B visa you generally have to find a company in the US that is willing to go through the hassle of getting you a visa (And the time this takes before you can actually come over and start working).
    * H1B is a "dual intent" visa, meaning you are legally allowed to aspire for permanent residence while you are here. It takes forever though and during this time you have to stay at your company (It usually takes at least 8 years). While you are applying for a green card you can extend your H1B indefinitely (I'm just about to extend my own for 3 years and I have already been here for 9).
    * O might not be attainable even if you have a exceptional talent. To get one for working in IT you are pretty much required to have a masters degree. I would contend that exceptional talent in the IT field have fairly little to do with official schooling.
    * Some of the H1B visas that are "fraudulent" are also people who have gotten promoted while here and the company didn't refile the proper paperwork indicate their new job titles. This usually means that they have a more qualified job and are paid a higher salary. I am not saying actual fraud doesn't happen, just that I doubt it is as prevalent as the statistics might show.

    And finally, on a macro economical note, why would you not take as many people as you could that are skilled earn a good wage, can't be unemployed and generally use social resources (If I loose my job I have 30 days to get out).

  • by Vicarius ( 1093097 ) on Friday October 26, 2012 @04:44PM (#41782725)

    I used to work as an H1-B worker. I 100% agree that the work visa program lowers wages and steals jobs from Americans.

    From my personal experience I know, that if I was not dependent on my employer I would have asked for higher than the market pay rate, rather than take lower than the market rate. However, since US government "helped", none of the companies I worked for had to offer proper wages to job applicants. I have seen many tailored job postings that were not really looking for applicants, but were posted only to fulfill requirements set forth by the government. Prevailing wage analysis and numbers that come out from that are mostly irrelevant and do not have to be lower than the wage being paid to the H1-B worker. My approved green card application had much higher wage than I was/am getting.

    The program does not protect American workers at all. I used to hate H1-B due to somewhat slave labor legal conditions associated with it, but now that I am almost a citizen, I hate it because in its current state it does not benefit Americans and actually harms them.

    Another things worth mentioning, although many people apply for green card after being on H1-B, the work visa is not considered to be a proper path to citizenship by US government. Partially due to this, none of the experience gained while working on H1-B can be used in green card application to prove that person is an asset to the company or to the country.

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