Sunday, April 19, 2009

Protectionism and the H-1B Visa – Ominous Consequences for All

The current economic condition in the U.S. is causing repercussions worldwide, and the consequences could be ominous for all concerned. Unemployment continues to rise, but limiting or completely shutting out highly skilled foreign workers is not the answer; in fact it could be harmful, even devastating to the US.

The number of students seeking admission to US universities this year could fall between 15 and 25 percent, owing to the poor state of the job market. In the past month, companies have delayed or rescinded job or internship offers for international students, as well as to recent college graduates. Demand for H-1B visas is also falling sharply compared to last year. The U.S. Bureau of Citizenship and Immigration services reported April 8 that only half of the 65,000 allotment had been taken. In 2008, the USCIS filled the same quota in one day.

The argument that giving a job to a foreigner takes a job away from a U.S. citizen is flawed. According to a study and recent article in the Wall Street Journal, hiring H-1B visa holders is associated with increases in employment at U.S technology companies in the S&P 500. Microsoft Chairman Bill Gates, New York mayor Michael Bloomberg and Republican Senator Judd Gregg of New Hampshire all have cited the study saying it shows that each one of these visas awarded to technology companies creates five jobs. Mr. Gates interpreted the study in testimony to Congress last year as finding that "for every H-1B holder that technology companies hire, five additional jobs are created around that person5.” It is common sense that hiring talented individuals leads to growth and innovation. It would seem likely that the visa policies would lead to an increase in offshoring. In the long run, the U.S. will suffer from reduced economic vitality and technological innovation. According to Stuart Anderson, Executive Director of the National Foundation for American Policy, “If Congress continues to keep the quotas low on H-1B visas and pushes more outstanding potential immigrants outside America's borders, then we won't have to worry about debating the results of our research on job creation, since it's likely a greater proportion of new technology-related jobs and innovations will be happening in other countries”.

This doesn’t mean that the H-1B visa itself doesn’t need drastic revision. The program is filled with loopholes that enable fraud and allow employers to exploit foreign workers for low wages.

1. Student traffic to US could fall 15-25% -
2. Banks rescind job offers for international students -
3. Companies rescind, delay job offers to recent college grads -
4. H-1B Visa Demand Plunges with Economy -
5. H-1B Visas Lead to More U.S. Jobs -

Other related articles worth checking out:
America’s Perilous Anti-Immigrant Protectionism -
Opinion: “Hire American” is a slogan that doesn’t help America -
US firms that employ skilled work visa holders create more jobs -
IRLI Wins Compensation for Abused H-1B Worker -
The Dream Deferred -

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