Summary The debate over highly skilled foreign workers has intensified with prominent Democrats weighing in on the issue of H-1B visas, which allow companies to hire foreign workers with specialized skills. Critics argue that these workers are displacing Americans by providing cheaper labor, particularly in the tech industry, while supporters claim there is a shortage of US workers with the necessary qualifications and skills.
The History and Purpose of the H-1B Visa Program
The H-1B visa program was created in 1990 as part of the Immigration Act to provide a temporary work visa for foreign workers with specialized skills. The program allows companies to request permission to hire foreign workers who have at least a bachelor's degree or equivalent, and are certified by the Department of Labor as meeting certain requirements. The initial stay period is three years, with a possible extension to six years, but some workers may stay on H-1B visas for longer if they have an approved petition for a green card.
The annual cap on new H-1B visas was set at 65,000 in 2006, with an additional 20,000 available for foreign professionals who graduate from US universities with master's degrees or higher. Despite the cap, over 30,000 employers across the US had at least one H-1B visa petition approved in 2024, and more than half of those new petitions went to employers that filed fewer than 20 applications.
Industry Breakdown: Where Do H-1B Visa Holders Work?
The largest industry using H-1B visas is professional, scientific, and technical services, accounting for nearly half of all approved initial visas in fiscal year 2024. Educational services accounted for 11.9% of approvals, followed by manufacturing at 9.3%, and healthcare and social assistance at 6.5%. The largest employers of H-1B visa holders are concentrated in the tech sector, with companies like Amazon, Cognizant, Infosys, TCS, and IBM leading the pack.
Displacement of American Workers: Fact or Fiction?
Critics argue that H-1B workers displace American workers by providing cheaper labor. However, supporters claim there is a shortage of US workers with the necessary qualifications and skills to fill the demand in growing industries like tech. The Economic Policy Institute (EPI) found that some companies are turning to cheaper foreign workers rather than hiring US workers, while others lease out foreign tech workers to other US companies that lay off their local IT departments.
Why H-1B Workers Are Considered Cheaper
H-1B workers are not supposed to be cheaper. To ensure wages remain competitive, an employer must pay the H-1B worker either the same wage it gives to other employees with similar experience and qualifications for a given job or the prevailing wage for that position in the area it's located, whichever is higher. Studies have shown that most people with temporary work visas in the US actually earn more than comparable US-born workers.
Abuse of the H-1B Program: Exploiting Loopholes
Some companies have exploited loopholes in the rules to pay H-1B workers less than what a US worker would make. These issues are getting addressed, with new rules requiring that a petition is for a specific worker rather than a position. Efforts should deter fraud but not be so stifling that the program doesn't work in practice.
The Real Need: Filling Gaps in the Workforce
Not only is our workforce shrinking as baby boomers retire, but the pandemic also exacerbated shortages in certain industries like teaching. School districts are leaning on international educators due to a shortage of bilingual teachers in the US. H-1B visas allow international students graduating from US medical schools to stay and work in hospitals or clinics in underserved areas where American workers will not go.
Conclusion
The debate over H-1B visas highlights the complex issues surrounding foreign workers in the US labor market. While some critics argue that these workers displace Americans, others claim there is a shortage of qualified US workers to fill the demand in growing industries like tech. As the program continues to evolve, it's essential to address concerns about abuse and ensure that rules prevent wage suppression while still allowing for the necessary foreign labor to meet industry needs.