For the first time since 2008, the United States Citizenship and Immigration Services has put a lottery to work on determining the fates of approximately 124,000 applicants filing for H-1B, a special visa given to foreigners to work for American private businesses.
They created the lottery when H-1B visa applicants reached the cap of 65,000 rapidly within five days. But five days is not the fastest record for reaching the cap on working visas — in 2007 it took one day and, in 2008, two.
Under the Immigration and Nationality Act, the number of H-1B visas is limited to 65,000 per fiscal year. Current law exempts up to 20,000 foreign nationals holding a master’s or higher degree from U.S. universities from the cap on H-1B visas. The scale of the cap has been working and has stayed the same way for years, yet it has become increasingly inefficient as the U.S. economy is regaining strength.
The H-1B visa was invented to fill the gap of highly skilled workers that private employers don’t find enough of in the U.S. Lawmakers set a cap on the visas in a very contradictory way, filling the occupancies that fewer Americans are qualified as well as fearing this H-1B visa would encourage foreign nationals to flock to the country and steal American jobs.
The cap on visas is entirely arbitrary and unnecessary and almost certainly imposes high economic costs on the country. Some lawmakers in Washington realize that the cap has to keep the pace with the economy, but it’s impossible for them to have enough information to determine what the scale of the cap should be to match the economic pace year by year.
Union organizations are concerned that giving too many foreigners working visas would equate to more jobless Americans, but this concern doesn’t stand given the difficulty of hiring a foreigner. The laws place many hurdles in the way when a firm sponsors a H1-B visa for an employee. For example, an employer must prove that an occupation is less likely to be filled by domestic workers.
Additionally, the wage paid to a foreign national must exceed the prevailing wage in the local area and applicants must prove that the jobs they are taking match the fields they studied in college. Given the cost and difficulty of getting a visa, employers are less likely to hire a foreigner and sponsor visa if they can find a suitable candidate at home.
Studies have found that skilled immigrant workers are more likely than their domestic counterparts to create patentable inventions, more productive and more passionate about entrepreneurship once they settle down.
Michael Clemens, an economist of the Center for Global Development, looked pre-crisis at one particular Indian firm that was involved in the IT outsourcing trade. Since visas were handed out by lottery, he’s able to match employees of the IT outsourcing firm that lost the lottery to employees of the IT outsourcing firm that won. He finds that lottery winners’ salaries increased from $55,000 to $58,000 per year. In other words, for reasons that aren’t entirely clear, skilled IT workers experience miraculous productivity when they are allowed to come to the U.S.
Tech companies have been pushing Congress for years to increase the number of H-1B visas available to highly skilled and educated foreign workers, as well as free up additional green cards for them. H-1B visas are key to helping them to bring foreign employees based abroad to work in the U.S. temporarily on special projects, which helps them keep jobs in the U.S. and create other jobs in the country.
However, lawmakers in Washington, D.C. perceive this problem in a wrong way. Sen. Charles Grassley (R-Iowa) introduced a bill last month aimed to strengthen the restrictions on H-1B program without any intention to loosen the cap. It seems the cap will remain a hurdle as the economy bounces back to its normal state.
