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H-1B Filing Season has Come and Gone : The Economics of Immigration

female scientistThis is becoming a terrible annual ritual. That is, April 1 has once again come and gone, a new H-1B filing season was upon us, and on April 7, 2017, U.S. Citizenship and Immigration Services (“USCIS”) once again announced that it had reached the congressionally mandated H-1B cap for Fiscal Year 2018. So the H-1B filing season, after only five (5) days (because USCIS did not start accepting petitions until Monday, April 3, 2017), is over for employers who are not eligible to file cap-exempt petitions.

The H-1B program was created so that employers can fill specialty occupation positions in their companies on a temporary basis. These are positions that typically require a Bachelor’s Degree for entry into the field. Look around today’s Capital Region, or Tech Valley as it has come to be known. These positions are vital to local employers, allowing them to be more competitive, increase growth, and yes, even create jobs for U.S. workers here.

Unfortunately, employers are being stymied by these ridiculous artificial limits which were established when I wasn’t even practicing law! And, as USCIS has done in prior years when it received well over 200,000 petitions for these coveted H-1B visas, USCIS randomly selects petitions to determine those that will have a chance at the 85,000 visas available. (Imagine telling your clients, after they’ve paid you your fees for your professional services, that a “lottery” will dictate whether their petition will be selected.)

Benjamin Johnson, Executive Director of the American Immigration Lawyer’s Association (“AILA”) was recently quoted as saying the following:

“With unemployment below 5% and an economy hungry for skilled, educated workers, why are we hampered by the arbitrary limits on this program? Instead of a lottery to funnel only 85,000 of the petitions through the process, this entire operation should be driven by market demand so that the program meets the legitimate needs of our country. Each year that we limit these visas with an artificial cap, we stifle economic growth and all of us lose out. It is an irrational system. Our immigration laws were written more than a generation ago, when Google and Amazon weren’t household names, before Twitter, Facebook, and social media itself existed. Every year that goes by without action on this and other necessary legal immigration reforms means countless opportunities lost.”

I could not agree more. The simple fact is that U.S. employers are not able to find enough, and in some cases any, highly skilled workers to fill essential positions in their businesses. There are not enough U.S. workers with advanced skills in science, technology, engineering and mathematical occupations (i.e., STEM fields) to perform the work that many high-tech companies need. Indeed, this shortage of skilled labor has forced many companies to out-source their operations abroad, something I see clients of mine struggling with every day.

I think that the arguments as to why we need to limit the amount of H-1B’s (e.g., to protect U.S. workers, wages, etc.) are generally without merit (there are some companies that endeavor to abuse the program, but in my opinion they are outliers), and the current regulations implementing the H-1B worker program protect U.S. workers, wages and so on. The simple fact is, and the evidence and literature amply supports the proposition, that the H-1B worker program impacts our economy and employment opportunities of U.S. born workers in a very positive manner.

For example, between 1990 and 2010, the increase in STEM workers in the United States under the H-1B program were associated with a significant increase in wages for college-educated U.S. born workers in 219 cities in the United States. In addition, H-1B-driven increases in STEM workers in a city were associated with an increase in wages of 7 to 8 percentage points paid to both STEM and non-STEM college educated U.S. workers, while non-college educated workers saw an increase of 3 to 4 percentage points.

What about arguments that the H-1B worker program negatively affects employment rates? Not true. The simple fact is that H-1B workers complement U.S. workers, fill employment gaps in many STEM fields, and expand job opportunities for everyone.

The evidence shows that unemployment rates are low for occupations that use large numbers of H-1B visas. For example, many STEM occupations have very low unemployment, compared to, according to the Bureau of Labor Statistics, the overall national unemployment rate. This means that the demand for labor exceeds supply.

Finally, what about those that argue that the benefits of the H-1B program are limited to those involved in technology fields? Some even argue that H-1B visas are all taken by Silicon Valley companies. Some even say Microsoft and Google take them all by themselves? Again, not true. According to data published by the Brookings Institution, in the 2010 – 2011 fiscal year, there were 106 metropolitan statistical areas across the United States that had at least 250 requests for H-1B workers. And while there are admittedly a lot of H-1B workers that are filling STEM occupations, there is also a significant amount of demand for H-1B workers in healthcare, business, finance, and life science fields.

There are exemptions to the H-1B cap that some employers are eligible for (e.g., institutions of higher education, related or affiliated non-profit entities, nonprofit research organizations, or governmental research organizations), and it’s great to represent entities that have an exemption available to them. But the simple fact is, the cap should be raised, significantly, or even eliminated. The evidence is clear that the H-1B visa program enhances our economy in so many important ways.

 

[1]  See, e.g., Nicole Kreisberg, “H-1B Visas: No Impact on Wages” (Great Barrington, MA: American Institute for Economic Research, 2014); Giovanni Peri, Kevin Y. Shih, Chad Sparber, and Angie Marek Zeitlin, Closing Economic Windows: How H-1B Visa Denials Cost U.S.-Born Tech Workers Jobs and Wages During the Great Recession (New York, NY: Partnership for a New American Economy, 2014); Giovanni Peri, Kevin Y. Shih, and Chad Sparber, “Foreign STEM Workers and Native Wages and Unemployment in U.S. Cities,” NBER Working Paper No. 20093 (Cambridge, MA: National Bureau of Economic Research, 2014).

[1] Giovanni Peri, Kevin Shih, and Chad Sparber, “Foreign STEM Workers and Native Wages and Employment in U.S. Cities” (Cambridge, MA: The National Bureau of Economic Research, 2014).

[1] Id.

[1] Information Technology Industry Council, the Partnership for a New American Economy, and the U.S. Chamber of Commerce, Help Wanted: The Role of Foreign Workers in the Innovation Economy (Washington, DC: December 2012), pp. 2-3.

[1] Neil G. Ruiz, Jill H. Wilson, and Shyamali Choudhury, “The Search for Skills: Demand for H-1B Immigrant Workers in U.S. Metropolitan Areas” (Washington, DC: The Brookings Institution, 2012), p. 1.

[1] Id.

 


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ABOUT THE CONTRIBUTOR

David W. Meyers, Esq. is managing partner of Meyers & Meyers, LLP. David works with individuals, businesses and higher education institutions helping them resolve any issues regarding immigration, citizenship and naturalization for themselves or their employees.

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