Recently, the Senate Judiciary Committee has been looking at the H-1B visa program and its impact on the tech labor market. This visa program allows American firms to temporarily hire non-immigrant foreign workers without recruiting American workers beforehand, provided that the firm pays the immigrant workers $60,000 or more. This allows to increase profits by hiring less expensive labor, as foreign tech workers will often work for lower salaries; furthermore, the H-1B visa program provides extra workers in the times of a shortage.
While this visa program may allow firms to find the workers they need and maximize profits, many believe that it is too harmful to U.S. tech workers, and violates their rights. In recent Senate debates, many stated that Southern California Edison (SCE) fired 500 U.S. tech workers who were making $110,000 a year and replaced them with Indian workers who are paid $70,000. Furthermore, the firm made the replaced workers train the new workers. Along with SCE, Disney World, Cargill, Northeast Utilities, Harley Davidson, and many other large companies carry out this practice, according to witnesses. This practice leaves an estimated 40,000 U.S. tech workers jobless each year.
The chart below displays the distribution of salaries for H-1B workers. While some foreign H-1B workers are earning salaries on par or higher than the average U.S. tech worker, the majority make much less.
One solution to this issue, as proposed by Utah Senator Orrin Hatch at recent senate debates, is to raise the minimum pay required to hire H-1B workers by choice instead of American workers from $60,000 to $95,000. This required salary increase would push firms to use the H-1B program for its intended use-to find workers when the supply is low, instead of simply choosing to outsource foreign workers for less expensive labor. Therefore, U.S. workers will be harmed much less by the outsourcing of labor, but firms will still be able to find the labor workers need. Furthermore, this salary increase would improve the well being of the current foreign H-1B tech workers in the U.S., and provide them with equal treatment to U.S. tech workers.
Among other questions debated at recent Senate meetings is whether or not to increase the quantity of H-1B visas available to foreign workers. By doing so, companies would be more easily able to hire less expensive labor from a much higher supply; however, there does not appear to be a shortage of U.S. tech workers. This change would have a great cost to the labor market for U.S. tech workers, putting even more of them out of work, and increasing unemployment and inequality.