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May 7 2014

Saying “No Thanks” to 87,500 High-Skill Workers

By Martin J. Lawler & Margaret Stock

Wall Street Journal, May 7, 2014 7:00 p.m. ET

The Obama administration announced on Tuesday that if holders of H-1B visas for high-skill foreign workers are being sponsored for a green card by their employers, then their spouses will be able to work in the U.S.

That’s nice for those families, but the news didn’t begin to address the real problem with the administration’s H-1B visa policy: There aren’t nearly enough visas. On April 1 the U.S. Citizenship and Immigration Services was deluged with 172,500 applications for H-1B visas that became available that day. But there were twice as many applications as spaces available because Congress allows only 85,000 of the three-year visas to be issued annually. Given that the application fee ranges between $1,575 and $2,500, if the average fee is $2,000, when the U.S. sends rejections to 87,500 H-1B applicants it will also be refunding about $175 million. In other words, the U.S. will be saying: Thanks for all that cash, and thanks for offering to bring your talents to this country, but no thanks.

In a country that supposedly values the free market, why are companies like Apple, Google, Intel and scores of others being denied the workers they need to compete in the global economy?

The alternative for some big companies is more outsourcing. Microsoft hasn’t waited for Congress to get its act together to authorize more visas. It set up a Canadian company to employ the foreign software engineers it would have brought to the U.S., and Canada will now benefit from those workers’ salaries, tax payments and spending.

Other software companies are now setting up operations in China, Poland and Hungary, and hiring foreign professionals there because they cannot be assured of an adequate number of high-skill workers in the U.S. In February 2011 Steve Jobs told President Obama that Apple employs thousands of engineers in China that it would like to employ in the U.S. But with a congressionally imposed quota, the jobs will stay overseas and the loss to the U.S. economy will be significant.

While larger companies can send work to their subsidiaries offshore, startups and smaller companies often do not have the funds to do that. Instead, they depend on an inadequate pool of U.S. high-skilled workers and a few H-1B workers, if they win the visa lottery.

Some claim there is no shortage of science, technology, engineering or math (STEM) workers, and that U.S. companies hire foreign employees to be “indentured workers” who can be paid low wages. In 2012, David North of the Center for Immigration Studies said, “It is well known that many H-1B workers are, in effect, indentured by employers who had filed to obtain green cards for them—they are nominally free to leave, but it can be hard to keep your resident alien application alive after leaving the employer who set it in motion.” While this spin may stir emotions, it is flat-out wrong. In 1991 a complex system of interconnected laws and regulations was enacted requiring H-1B workers to be paid the prevailing wage and provided with working conditions equal to those of U.S. workers.

The Labor Department must certify, through a formal process, that H-1B wages are appropriate. Public notices of the jobs, including the wages, must be posted at the work site. The notices must contain specific information about filing a complaint challenging the wage and working conditions. Once the certification is issued, the U.S. Citizenship and Immigration Services conducts a thorough review of the entire case, including details about the employer, employees and positions.

There are also unannounced spot-check investigations, verifying that the workers are at the location they claimed and paid the proper wages. There have been few complaints of employers not paying the proper wages to H-1B employees; 90% of violations involve paperwork problems. When a foreign national applies for an H-1B visa at a U.S. consulate, the engineer or scientist must present payroll records proving
payment of the wage certified by the Labor Department and approved by the U.S. Citizenship and Immigration Services. Without the proof, the visas are denied.

Because Congress is dysfunctional, the Obama administration should take action on its own. When workers become permanent residents via marriage to a U.S. citizen or company sponsorship, or the worker moves back home, the remaining time on their H-1B temporary visa goes to waste. The administration should permit the recapture of H-1B visas that are no longer needed and put them back into the pool for new employees. This could add tens of thousands of H-1B visas for engineers and scientists.

Congress should also tear down the arbitrary H-1B quota limit. We need these eager workers to help U.S. companies build the next generation of high-tech batteries and solar cells, better defenses against cyberattack, and the next Apple, Google or Intel. One would think our arbitrary H-1B quota and lottery system was created by our competitors in China, not our own Congress.

Mr. Lawler and Ms. Stock are immigration lawyers and authors of “Professional: A Matter of Degree,” fifth edition, published by the American Immigration Lawyers Association, 2009.

Here is the WSJ link to the full article: