The H-1B Visa Debacle

In every recruiter training program that I facilitate, time is allocated to better understanding economic and legislative trends that are inevitably impacting the broader employment marketplace, which brings me to the topic of this particular post. In the aftermath of the 2016 election cycle, there’s been a great deal of controversy swirling around the H-1B Visa program. Of all the visa types that allow individuals to work in the United States. (F-1, L-1, O-1), H-1B’s are utilized to legally employ most foreign nationals. H-1B visas allow companies to hire skilled foreign workers who, at a minimum, have obtained a college degree. These visas are most frequently leveraged by the high tech, healthcare, scientific, and engineering industries.

Last month, President Trump signed an executive order entitled “Buy American, Hire American,” calling for an overall review of the H-1B system, with the goal of protecting the American worker. While the sentiment of protecting American jobs resonates with many, according to a May 2017 Time Magazine article, the reality is that many American’s lack the essential skills needed to fill many specialized positions, and from a performance perspective, U.S. students trail their foreign counterparts in practically every subject area.

While there is no disputing the fact that Americans may lack the skills to perform some of these specialized jobs, the H1-B issue is perhaps more contentious due to the assertion that companies outsource specific positions principally out of a desire to hire cheap foreign labor. While immigration laws require companies to provide equal compensation to foreign workers, it is difficult to determine whether this requirement is being followed, and even more difficult to enforce.  Over the past few years, controversies have emerged as American workers have reported being laid off as employers turn to cheaper foreign labor. According to a May 4, 2017 article in the Harvard Business Review, matters have been made worse when some individuals being laid off have been required to train their foreign replacement. Also, there are those that allege that the H-1B visa system is being gamed by Indian and Chinese companies that are engaged in their own form of high-tech human trafficking to meet the hiring demands of the companies they support.

One emerging bill, H.R. 170, proposed by Rep. Darrell Issa (R-Calif.) and Rep. Scott Peters (D-Calif.), would establish a new H-1B visa minimum salary requirement of $100,000 to discourage companies from hiring or exploiting cheap foreign labor. The current minimum salary requirement for H-1B visa workers is $60,000. It’s highly logical that this disparity in minimum starting salaries for workers holding an H-1B visa would have a significant impact on firms who have traditionally leveraged the H-1B visa program as a means of securing cheap foreign labor. Additionally, there must be a tipping point where the cost of employing an H-1B visa holder is less appealing than investing in training American workers.

There is likely a middle ground of truth between the need for high-skilled foreign labor to fill specialized positions, and the fear of Americans losing their jobs to cheap foreign labor, but in theory this House Resolution could protect all parties. This bi-partisan bill could potentially ensure American workers receive the advantage they deserve, while also providing high-skilled foreigners with fair compensation for their work. Will our incredibly dysfunctional congress get this bill passed? Who knows – Only time will tell. To view H.R. 170, go to: https://www.congress.gov/bill/115th-congress/house-bill/170