H1B visa holders did not cause U.S. job losses

H1B visa holders did not cause U.S. job losses

By SiliconIndia   |   Tuesday, 31 March 2009, 03:35 Hrs   |    32 Comments
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H1B visa holders did not cause U.S. job losses
New Delhi: Nullifying the blame game on the H1B visa holders, who were held responsible for the immense job losses in the U.S., a study shows that only seven in 10,000 civilian workers in U.S. are H1B holders. "There are over five million unemployed people in the U.S. How can 65,000 H-1B visa holders be held responsible for job losses?" said an executive of an Indian IT firm that figured among the top 10 H1-B users.

As per the report by the National Foundation for American Policy (NAFP), 1,07,686 new H-1B petitions were approved by the U.S. Citizenship and Immigration Services in 2008, reports The Economic Times. The number also includes those visas exempted from being included in the H1-B quota of 85,000 visas annually. However, in comparison, the American civilian labor force stood at 154.6 million in 2008. The report also noted that Indian IT firms utilized only 11.9 percent of new H-1B petitions issued in 2008, contrary to popular perception in the U.S. that these firms use up most of the visas.

The report comes in the wake of a recent decision in the U.S. Senate that restricts hiring of H1-B visa holders by financial services firm receiving government bailout funds. The unjustified backlash against the H1B visa holders, is seen in the fact that the usage of the H1B visas declined by 27 percent between 2006 and 2008. H-1B visas bagged by U.S. based Cognizant, which has a large presence in India, came down from 17,550, or 15.1 percent, of total H1-Bs issued in 2006 to 12,810 in 2008. A recent report by Duke University professor and Harvard researcher Vivek Wadhwa and his team found that the Indian and Chinese professionals leaving the U.S. are finding greater opportunities in their native countries.

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Reader's comments(32)
1: Of course any website call siliconIndia is going to be pro h1b. Which underscores the fact that it isnt good for America. You Indians are such Hipocrits. If people were coming into your country,lowering your wages and jobs were being removed by people who could care less about your values you would be marching in the streets.
Posted by:Daniel - 12 Apr, 2009
I agree with you 100%. I live out in Silicon Valley, CA and you can go past most any corporation out here and all your going to see is zhit-loads of EI's, and these guys are here for no other reason but to screw high technology Americans out of their jobs. All these various Visa programs need to be closed down for good. And I've go the answer for it. Place a fine of $2.000 a month on the heads of each and every single H1b-L1 etc. Visa worker a corporatio keep on staff...Make these fines payable to whatever state to help pay for all the unemployment they created. They don't like it, they can pack up and out their stinking visa worker and go live over in India.
Yours Truly,
Another Silicon Valley 99er
Cathy Replied to: Daniel - 22 Dec, 2010
3: I feel there are three main issues regarding H1B visas. The first directly contradicts what is said in this article. Even if H1B visa's represent only 7 in 10,000 American jobs, these people are willing to work for less, which diminishes the labor market. It must also be pointed out that with so many exemptions, this 65,000 limit will more than double or triple. Secondly, in some cases, H1B visa holders do not have to pay taxes. This results in lower tax revenue for the federal government in a time where we are at a major federal deficit. My final point is that with a national unemployment rate near 8.1%, isn't it time to start thinking more about supporting our own country than supporting non-residents?
Posted by:Jim Rees - 01 Apr, 2009
@ Jim rees.. can u explain where H1B holders pay less tax.. we pay much more than an average american.

If H1B's irrespective of country of origin are not invited, then america should not call for FREE TRADE or lead the so called FREE WORLD.. face it !
Jeeva Replied to: Jim Rees - 21 Apr, 2009
Dear Mr. Jim,
I think you have poor knowledge about H1B. H1B's have to be paid the market rate of his designation. H1B's pay more taxes than Americans and have no benefits from the US government say it medicaid or social security.
Jsun Replied to: Jim Rees - 12 Apr, 2009
Jim I think you may be a littlt mis(un)informed. H1B visa holders HAVE to be paid the same salary that an American would have got IF that American would have opted for or be qualified for the th job. And of course they pay taxes just like any other person. The unemployment status affects both alike.
Ramindra Walia MD Replied to: Jim Rees - 03 Apr, 2009
For full time employment you may be right. However as an independent consultant, I quote hourly rates and have seen those rates continue to fall while seeing more and more H1Bs in my area of expertise. I have been told a number of times by 3rd party "head-hunters" that I can no longer get my previous hourly rates because of Indian contracting firms bidding far lower hourly rates.

While I realize that rates have fallen recently due to the economy, this process started at the peak of the I/T market and I for one feel certain that it was for the sole purpose of driving prices down. If anyone in America doubts that our government is run by an elite group of business tycoons wanting solely to make the rich richer look around. Everytime the middle class in America make progress, there is a major disruption to "bring them back in line".

I once did a contract in Canada and the company that hired me had to show the Canadian government that my skill-set was not available via Canadian Citizen and I had to carry that document with me each time upon entering to do business in Cananda. Seems like a fair way to proceed. After all charity begins at home.

I would like to see the percentages for H1Bs in the I/T fields and more specifically in Contracting for SAP, Oracle and similar.

A local company near me has laid off a number of permanent employees while Maintaining a large number of H1B workers.
Griff Replied to: Ramindra Walia MD - 17 May, 2009
Hello Jim, Plase first get the facts right before you make any comment. I don't know how in the world you got the idea that H1B visa holders do not pay taxes. They pay the same tax which you guys pay. In the end, you guys get the benefits out of these taxes in terms of Medicare and SSN in your old age, but H1B guys do not get these since they leave for their countries long before they get to that age. They pay taxes so that you guys can have a better life when you get old.
Secondly, if you think its time for you guys to suport your own country then have the guts to put yourself in the line and say so. Don't hide behind the slogans of globalisation, equal oppurtunities etc . What you guys are doing to the H1B guys is not in the good faith of globalization.
Raj Replied to: Jim Rees - 01 Apr, 2009
9: Nice job stereotyping and insulting the people who you want to work for in their country.

Don\'t you think Americans would be looking for jobs in India desperately trying to move to a foreign country if India and China were so superior?

\"I demand to work in your country stupid racist\"

And you wonder why tension exists?
Posted by:Joe - 01 Apr, 2009
Dear Mr. Joe,
It's you who are stereotyping immigrants. That is where American education system is failing in imparting the truth about other countries. People who come to this country do not condemn or insult America. But American arrogance has only shown the other side of America which is of people like you.
Jsun Replied to: Joe - 12 Apr, 2009
Very true. Leave the attitude at the door you egotistical pricks.

This “stupid” American with an MIT comp sci degree is tired of having to review a meeting 10x to figure out what you were trying to mumble in the meeting.

You’re trying to come to America for a reason and it’s not because of H1B visas. We were number 1 long before you came here.

Treat us with the respect you expect to be treated with or go to hell and stay in your "superior" country of India.
Pete Replied to: Joe - 02 Apr, 2009
Nice coding by the way...can't translate a notepad .txt file without bringing special characters.

You're so much beter.
Pete Replied to: Pete - 02 Apr, 2009
13: I guess the double standards and lavish resources spending of US indirectly led to the situation currently they are in. It’s funny to blame H1B workers when you had a big economic problem in your front yard. It’s like showing your frustration on some one else for the mess in your own house.
I see some of the comments made here are not well thought out. More than 50% of Major US Conglomerates revenue comes from out side USA.This it self is an indicator that you are not insulated in the world and they make hell lot of money by taking advantage of opportunities in the other courtries.If all these countries stop American companies from doing business then US economy would reduce to unprecedented lows in the world. So one should accept the fact that US too has dependence on other countries. Coming to H1B issue this instrument was created by US for their own benefits to take advantage of global talent. Indian folks are smart and talented enough to tap on the opportunity. When this instrument was hugely praised and encouraged by Americans to solve their Y2K issue then why now you are making hue and cry about it. It’s another sign of double standards. Does any one know how much money American companies make setting up shops in automobile,oil,engineering,aviation,retail etc in India alone. So called(artificial though) economic burden from H1B on US is not even 1% of What American companies make out of India. They are still earning away staggering wealth.
Posted by:Kumar - 31 Mar, 2009
14: The h-1b Visa is known as the "Outsourcing Visa" and is so proclaimed the Indian National Government.

And the fight to reform the H-1b visa program has been going on for years. We have been slowly, patiently, educating our people and our government on the real problems with the H-1b visa.

Satyam, Infosys all the other Indian IT Offshore Outsourcing companies need the H-1b visa in order remove whole departments from the United States and relocate them in India.

We need those jobs right now, but they are gone because politicians in the United States take donations from lobbyists (like Jack Abramoff) from companies that want the cheapest possible labor and need people who speak the real language in India in order to move departments offshore.

The U.S. government has found that more than 1-in-5 H-1b visas are fraudulent. The U.S. government has found cases where people here on H-1b visa are pumping gas or working in laundromats. The U.S. government has found people on H-1b visa being paid the mid-west prevailing wage of (40-60k) while working in a west coast job (where the prevailing wage should be 80-100k).

Look I have been there, people here on h-1b visa are being paid half, 50k for 100k/year jobs. I have seen actual memos, participated in meetings where this was documented.

Further, most of the jobs offered to H-1b applicants are H-1b only. U.S. citizens are not even given a chance to compete for the job. The major Indian IT outsourcing companies have a huge number of Indian workers here on H-1b. The U.S. engineering workforce these companies is hugely Indian, that's discrimination pure and simple. The previous Secretary of Labor has said "employers may hire a foreign worker under H-1b, even if an equally or more-qualified U.S. citizen, wants the job.".

No country on Earth would allow such a policy. Only the U.S. whose government actually subsidizes the removal of jobs, which is exactly what the U.S. was doing under Bush, has such a policy, where foreign workers may be hired even when a "More competitive, and more qualified citizen worker" wants the job.
Posted by:Jake the Rake - 31 Mar, 2009
I don't think anyone is blaming the H1B Visa workers for causing the job loss. It's just a fact that right now there are more people unemployed than jobs and with the exception of very highly skilled scientists and doctors, the USA doesn't need H1B Visa workers at this time.

The US has plenty of software engineers, business analysts etc that are unemployed who need jobs. These jobs should go to US Citizens who are qualified to fill them before ANYONE else.
Joe Replied to: Jake the Rake - 01 Apr, 2009
Jake the Rake has a lot of imaginative power to have come up with all those baseless ideas!Good job buddy.

Yes, you do need those jobs but are you qualified to do it?How many American kids go to engineering schools? Aren't kids interested in math considered nerds in the contemporary American society? Firstly, work on that image and send more of your kids to engineering schools.

Nobody can pump gas on H1B Visa, the people you have seen are on a separate VISA. For your eyes every Indian is on H1B VISA. Such is the limited vision.

Furthermore, there are no jobs which are limited only to H1B holders. In fact, there are numerous jobs which are only for "US Persons". Please don't distort the facts Jake. And if American workers were qualified they would have been hired. They demand significantly higher salaries, benefits and perks than what is desirable for that job. Besides, everybody wants to be a manager. And the work they do even with all these facilities is worth discussing.

No country would allow such a policy because no other country has such high demand and such low supply of "qualified" workers. Get that straight for sure.

Raking the Jakes Replied to: Jake the Rake - 01 Apr, 2009
17: Lets get the facts right first. There are 65,000 H1B visas issued per year. You have to look at the accumulated numbers for H1B's which can be 3 to 4 times the 65,000 per year that we are talking about since it takes an average of 6 years for H1B's to convert to Green cards. Ofcourse not all stay in the US that long but those that stay, stay in the H1B category.
Posted by:Ash - 31 Mar, 2009
18: Guys dont get this situation wrong.. all this does is basically ensures that the country is protecting its masses - as they had promised. This is increasing the possibility of Americans getting a job by what ever way possible. They have to take care of his ppl. Even in India its prevalent. Take for example - Mumbai incident where there was a recent furore about jobs going to folks from North India. So its every where. This is just a desparate measure.. things will fall back to normal. i know many would not agree - but we need to see it from all angles.. infact its good for all of us who can stay with our families - enjoy our lives and work from our country.
Posted by:Why - 31 Mar, 2009
19: John (obviously not your real name),
You're assuming that H1B's are more innovative. THEY'RE NOT. They just work for less money. They have fake degrees and fake resumes and are modern day slaves for corrupt and unscrupulous corporations (remember Satyam). If you don't like it in the US, here's an original thought, GO HOME. The US became a superpower without the cheap labor and once we rid ourselves of it, we'll be back on top.
Posted by:G Washington - 31 Mar, 2009
" The US became a superpower without the cheap labor and once we rid ourselves of it, we'll be back on top."

200 years of slavery conveniently forgotten! lol!
..... Replied to: G Washington - 09 Apr, 2009
haha. power is like addicion! the more u have. the more u want! so ofcourse i agree is a super global power. is it bacause US got more weapons so that they can! i believe everyone are equal! whomeever.whatever.whenever.Its that US companies that started this loop holes in their law and its US govnment who approved and now is it right that they r blaming H1B visa holders? Prevention is beter than cure i believe in!
hehe Replied to: G Washington - 01 Apr, 2009
22: Unless bold and honest steps are taken to improve upon, this country is heading to disaster. It is the manufacturing going to China backed by the greed and corruption of the government officials that is responsible for what the state of this country it today. No politician is talking about China where all the money and jobs are going. Rather than bringing back the manufacturing where thousands of brainless jobs can be created and for which a normal American worker is good at, these politicians are killing innovation by stopping H1Bs. Not realizing that they are killing themselves in this process. We Indians are capable enough to rise on our own and if united - we can be the super power. Stopping H1Bs is only going to encourage outsourcing to India vs. anything else and that further shrinks the tax base in this country. The eocnomy of this country can be brought back to normal with $0 bail out money, if the guys in white house are serious and are thinking right. Almost every government project that I have ssen is either corrupt or run by old boys network who act like mafias. Instead of correcting their house, they blame countries like Afghanistan for corruption. Good luck and god bless corrupt American politicians.
Posted by:John P. - 31 Mar, 2009
23: The "National Foundation for American Policy" is simply a front for the cheap labor alliance. This study is a joke and no one takes it seriously. I find it funny how the Indian press is under the assumption that if they print a lie enough times, it will become the truth. The H1B Visa program is going away or the American politicians that support it are going away during the next election.
Posted by:P Henry - 31 Mar, 2009
24: I'm an American working for an Indian firm in India. My statement is simple. It certainly wasn't anyone on an H1B visa that put the economy in this mess in the first place. Are any of the CEOs at GM, Merrill Lynch, Bank of America, or Bear Stearns on an H1B visa? Are any of the folks at the Fed on H1B visas? Congress?

It was the sheer short term greed of these guys that caused this, all on the backs of the regular middle class taxpaying chumps who will be paying for all this along with their children and their children's children. They'll all be watching the foreclosure on their homes and the auctions of their property over the next 18 months.

It's easy to blame an H1B visa worker. Not so easy to blame the guy with friends in Congress and regulatory agencies. It's a damn shame.
Posted by:JEMH - 31 Mar, 2009
Well said. Its better to some one from offshore rather than blaming inhouse people which may create a back fire.
Niyamath Replied to: JEMH - 31 Mar, 2009
it shows that India has talent. Why they need people from India? Problem is that American cannot compete with Indians or Chinese.
Bhalchandra Replied to: JEMH - 31 Mar, 2009
Let's face it, India and China are at the lowest end of wages, Americans cannot compete with people in China and India, because at 2-4$/day, people in the U.S. cannot "Compete and Eat" with people in these 2 countries.
joe Replied to: Bhalchandra - 31 Mar, 2009
Largest investor of US Treasury Bills= China, $1.7 Trillion, which equals more than half the annual budget.
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henrylow Replied to: Ben - 31 Dec, 2009
30: well even this study won't be enough to prove them that the migrant workers never caused a threat to them.. no idea why did they have this prejudice against the H1Bs.
Posted by:sheela - 30 Mar, 2009
Their concern is justified to a certain extent. The study is incomplete if you just study the impact of H1B visas. To full understand the impact, you have to take into account the L1 visas and Business visas and how they are exploited and manipulated by Indian firms (though not without help from US companies). Btw,I am an Indian working in India in a US MNC.
Aditya Sehgal Replied to: sheela - 30 Mar, 2009
Even if you take blanket visas in L1, how much could you number it to,it might hadrly increase the ratio by 1 or 2 percent max and about business visas, what difference does it makes to the locals job there.
Raj Replied to: Aditya Sehgal - 31 Mar, 2009