To H-1B or not to H-1B

High-tech immigration: Bar the door or lay out the welcome mat?


Andrew Leonard
April 19, 2006 10:05PM (UTC)

In the 16 years of its existence, the H-1B visa program has become one of the enduring battlefronts of information technology class warfare. Native-born American workers charge that the program, which allows temporary employment of foreign workers in "specialty occupations," is a scam run by employers looking for cheap programmers. Employers, in response, say that there is an enduring shortage of skilled workers in the I.T. sector, and that they need the H-1B program in order to survive.

In the current charged atmosphere regarding all things immigration related, hostilities have broken out anew. A study published by the Center for Immigration Studies in December crunches some government data and argues that H-1B workers are paid an average of $13,000 less than their native-born counterparts. A rebuttal published by the National Foundation for American Policy in March says the author got his data all wrong, and besides, high-skilled immigration is good for the American economy.

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Adjust for bias as you please. John Miano, the author of the CIS study, founded the Programmer's Guild expressly to lobby against the H-1B program, and CIS is a fervent supporter of limits on immigration, legal or illegal. Meanwhile, the National Foundation for American Policy is yet another right-wing/libertarian think tank that can't abide the horrible thought that businesses should be restricted from doing as they please by any kind of regulation whatsoever. An ostensibly nonpartisan study by a Federal Reserve Board economist that found the H-1B program to have no measurable impact on native-born I.T. worker wages can be found here. (For a rebuttal written by a programmer, go here.)

We're not going to settle this question today, if ever. But let's propose a radical thought. Could both sides be right? For me, the most compelling piece of data in Miano's study was a list of the top 10 applicants for H-1B visas in 2004. They were, in order, Wipro, Infosys, Syntel, HPS America, Oracle, IBM Global Service India, Tata Consultancy Services, Patni Computer Services and Mphasis Corp.

Aside from Oracle, these are all companies that specialize in providing outsourcing services. In their based-in-America incarnations, they are referred to, by both native-born and foreign-born workers, as "body shops." They import foreign labor to the U.S. and subcontract it out to local companies.

The fact that workers are exploited at body shops is undeniable, and it supports the thesis that the H-1B-related L1 visa programs are being used to provide low-cost information technology services in the United States.

But just as American workers are desperate to escape temp agencies, so too are foreign workers often desperate to escape body shops for better jobs (and U.S. citizenship). And that's where the story gets interesting. The classic economic argument for allowing immigration is that its benefits to the overall economy outweigh its supposed downward pressure on wages. There is probably no place where this argument is easier or more appropriate to make than with respect to high-skilled immigration in the tech industry. Silicon Valley abounds with startups founded by Indian and Chinese immigrants. The interconnections and linkages created by high-tech immigrants between their native countries and their adopted homes have helped to power-boost the entire global high-tech sector.

I realize I am veering perilously close to a Thomas Friedman/Nick Kristof New York Times-style Op-Ed elitism: Bring in the smart immigrants, keep out the dumb ones. That's not my intent. The point is this: One can simultaneously acknowledge that the H-1B visa system is being used to exploit workers and that there are widespread benefits to encouraging high-skilled immigration.

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Maybe if we start from that position, we can figure out ways to craft a system that prevents the worst kind of body-shop abuses, provides all workers with a robust safety net and still maintains the U.S.'s long tradition as a Mecca for the best and the brightest, from everywhere.


Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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