Posted on 02/19/2017 1:35:05 PM PST by Tours
“This is now standard practice in the technology industry.”
US tech companies, and other companies with large IT departments, are having conniptions about President Trump’s immigration policies, particularly the leaked draft of an executive order that includes references to reforming the H-1B visa program for foreign tech workers.
In light of the 85,000 foreign tech workers allowed to be brought into the US annually under the H-1B visa program – a limit tech companies have been clamoring to raise – here’s a stunning forecast by the Bureau of Labor Statistics:
Employment of computer and information technology occupations is projected to grow 12% from 2014 to 2024, faster than the average for all occupations. These occupations are expected to add about 488,500 new jobs, from about 3.9 million jobs to about 4.4 million jobs from 2014 to 2024, in part due to a greater emphasis on cloud computing, the collection and storage of big data, more everyday items becoming connected to the Internet in what is commonly referred to as the “Internet of things,” and the continued demand for mobile computing.
That’s exciting news. So 488,500 IT jobs are to be created over ten years, so about 44,850 a year on average, which means more jobs in good years and net job reductions in bad years. But over the same decade, 850,000 H-1B visa holders would come to the US to fill these 488,500 IT jobs…. You get the idea.
Now we’re in the good years. So more IT jobs are being created. Alas, many of them are going to be filled by the 85,000 foreign workers brought in every year with H-1B visas.
Slightly different numbers, same trend: Goldman Sachs estimated in a report cited by the New York Times that 900,000 to 1,000,000 H-1B visa holders are now working in the US, accounting for 13% of US tech jobs, based on Goldman’s numbers; or up to 25%, based on the estimates of IT jobs by the BLS.
The meme that there are half a million tech jobs in the US that somehow cannot be filled by American workers doesn’t hold water. Dean Baker, co-director of the Center for Economic and Policy Research in Washington, told the Times:
“I’m sure employers might not have as much choice as they would like, but if the shortage story were true, we’d see wages rising more rapidly than they are,” he said, adding that there’s substantial unemployment even among workers in STEM fields (science, technology, engineering and math).
In theory, US companies have to try to recruit Americans first. So they put job ads out there but don’t hire anyone and then claim that they cannot find an American with the skills needed to fill the job. This gives them carte-blanche to bring in cheaper H-1B workers.
Companies that don’t want to jump through those hoops can apply for a waiver of the recruit-Americans-first requirement and bring in H-1B workers as long as they pay them over $60,000 a year – which is not a lot for IT workers – and as long as they have a degree, even if it is from a diploma-mill in India.
Tech companies, including giants like Google and Microsoft, have been lobbying for increases in the annual quota of 85,000 H-1B visas, claiming that there are not enough Americans to fill those jobs. This is ironic for at least some firms: while Google has been adding to its workforce, Microsoft’s employment has dropped from a peak in 2014 of 128,000 to 114,000 last year, after rounds of huge layoffs, globally and in the US.
Other tech giants that are struggling with morose revenues have also been shedding employees in the US, rather than hiring, including Cisco and IBM [Big Shrink to “Hire” 25,000 in the US, as Layoffs Pile Up].
What is happening time and again is that tech companies or IT departments at non-tech companies are laying off Americans and replace them with H-1B workers, often requiring the to-be-laid-off Americans to train their foreign successors. This is proof that the verbiage about not being able find Americans to do those jobs is just a pretext.
Some of these abuses of the H-1B visa program have become tangled up in Congressional investigations, including this one:
Southern California Edison, a utility, decided to lay off people in its IT Department, which had 1,800 employees and 1,500 contract workers at the time. As is typically the case, the Americans, who had to train their replacement H-1B visa holders from India, had to sign severance agreements with confidentiality and non-disparagement clauses that bar them from discussing the situation in public.
The scandal spilled into the open in 2015 when some of these affected employees talked to Computerworld. SCE then confirmed having hired Infosys and Tata Consultancy Services in India, two of the largest users of H-1B visas, to provide the H1-B workers [In Search of Cheap Labor in Tech: Behind the H1-B Visa Scenes].
Or last year, Dell-EMC announced that it was seeking efficiencies that might save $1.7 billion, and so it would lay off 2,000 to 3,000 US workers after requesting 5,000 H-1B visas and Green Cards to import foreign workers.
This has been happening all over the place. The latest scandal involves the University of California, San Francisco, which has laid off 80 American workers in its IT department last year. Among them was Audrey Hatten-Milholin, who’d worked there for 17 years. The New York Times today:
Along with eight others, she filed a complaint in November with California’s Department of Fair Employment and Housing, charging that replacing her and others with “significantly younger, male” workers “who will then perform the work overseas” was discriminatory.
“We are at a disadvantage as Americans,” Hatten-Milholin told the Times. “They look at it like, where can we get it cheaper? And for U.C., it’s not here.”
Soon after the lay-off notices went out, there were “knowledge transfer sessions” with employees from HCL Technologies, an Indian tech services company. Among the laid-off employees was Jeff Tan, who’d worked there for 20 years. He had to train HCL employees on how to do his job. Some of the HCL employees he trained were still in India, handled via videoconference; others had been brought to the US on H-1B visas.
“I thought the purpose of H-1B visas was to give America a competitive edge, not help companies ship American jobs abroad,” Tan told the Times. “This is now standard practice in the technology industry.”
With these strategies, U.C.S.F. expects to save $30 million over five years. That’s why they did that.
So now “tech” companies and companies with IT departments are fretting that a reform of the H-1B visa program might put some additional limits on the cheap-labor gravy train. The leaked draft of the executive order (image) included references to reforming the H-1B visa program to “ensure that beneficiaries of the program are the best and the brightest.”
Few people would have difficulties seeing the benefits of truly great minds coming to the US to do their magic. But there are not many of them. Yet this is constantly trotted out by tech employers as the reason to propagate the abuses of the H-1B visa program.
But even desperately needed reforms of the H-1B program still would not stop the outsourcing of IT jobs to cheap-labor countries – which is “the endgame,” Sara Blackwell told the Times. She is a lawyer representing former employees of Disney, Abbott Labs, and other companies in discrimination claims concerning tech-job outsourcing. It’s just too hard for corporations to resist the lure of cheap labor.
But hubris in Silicon Valley knows no bounds. Read… There’s a Lot More at Stake in this IPO than Just Toxic Financials
“The latest scandal involves the University of California, San Francisco, which has laid off 80 American workers in its IT department last year. Among them was Audrey Hatten-Milholin, who’d worked there for 17 years.”
Wow, a hyphenated SF UC woman wakes up and finally smells the roses.
Because they want to get free help and don’t realize the H1B’s live 6 to an apartment and send their salaries home instead of buying the stuff the company makes? Oopsie! Strategeric error.
If they can’t ship the jobs overseas, they want to import the workers.
There were a lot of reasons I voted for Trump, but being in IT, reforming H1-b visas was the most beneficial to me. I can’t imagine why anyone in IT would vote for Hillary, since she promised to open up the limits on foreign workers, but in my office, out of the ones that I know who voted, I am the only one who voted for Trump.
The surest way to cut down on H1b visa entries is to require that they be paid exactly what an American worker would. At the very least it would reduce the number of Americans being laid off and replaced by cheap imported workers.
For some reason Indian recruiters are contacting me again with short term, low paying contract jobs that might go perm.
I politely send them an update resume showing that I’ve been employed full time for several years.
There is real talk of some maintenance mechanics being laid off this coming Friday. I hope not. They are all good guys and I’ve learned or relearned tons from them.
H1B was supposed to be used to hire exclusive specialists from other countries like for instance Nuclear Scientists with experience in “sub nucleaon muon decay in super heavy elements” from Switzerland that only 5 people around the world know about and 4 of them were Swiss and the other was Japanese and we need 2 of them in the US for a new reactor design project for nuclear submarines....
It has been abused brutally to include any Indian schmuck who got a memorization degree in Java coding from Hindu U. which are a dime a freeking dozen and we have plenty of people HERE already who have the skills, but the Indians they can hire 4 for the price of 1...
That is theoretically a requirement but there’s too many ways to game it.
[ “I thought the purpose of H-1B visas was to give America a competitive edge, not help companies ship American jobs abroad,” Tan told the Times. “This is now standard practice in the technology industry.” ]
Hmmmm. Well, I guess she finally figured it out. When a large “consulting” firm was brought in at high-levels at a well-known American company (I will not name them privately, either) one of my customer-users asked what the purpose was.
I told him “To reduce head-count among your coworkers”. And then it began. A great number of their retail locations began to disappear starting not long after that time as well. Many of the stores I went to for field deployment tests, etc., no longer exist though they had for decades. Two are still in existence.
This story rings true to me. But I’m hoping there are some Freepers who are in the affected tech industries who can add some anecdotal evidence for either side of the argument.
This is important and we know where Trump will stand on the issue. But we need to stay #1 in Tech. So we need to hear from the other side. They might be able to make their case in some instances.
Bottom line for me: I’m with Trump and would love to see our schools cranking out increasing numbers of techies who move right into well paying jobs in the tech industries. That should be our future.
I guess I'm off-shore from the Neponset River.
All the more reason to levy a remittances tax, the percentage based on the number of illegals, legals admitted, countries of origin/destination, and type of visa admitted.
Paid for The Wall all in one fell swoop
No, they need to be paid at least as much as their supervisor is paid.
If they’re really as good as they’re claimed to be, it’ll still be a bargain.
Yup, it’s a win-win. The only concern is to make sure it never gets used against normal conservative American citizens moving money overseas out of self-protection from the goobermint.
You know that’s exactly how leftist tyrants would try to use it. OECD, Hillary & her intellectual spawn, etc.
If you make sure it can’t be used as a money saver / negotiating tactic against citizens, then it’s worthwhile as a program to attract the best and brightest, or to backfill a legitimate talent shortage among citizens.
Gaming the requirement has been standard practice for well over a decade. There may as well not be a requirement, given how easy it is to evade it and how nonexistent enforcement is.
1. An undergraduate engineer from a U.S. engineering school commands an average salary of $X.
2. An engineering technician who has no college education or perhaps an associate's degree or technical certification(s) commands an average salary of $Y, which might be 60% of $X.
3. The undergraduate engineer from a U.S. engineering school has some valuable skills, but does not have the ability to think rationally and exercise independent judgment, cannot write coherent English, etc.
4. A prospective employer recognizes that the undergraduate engineer from a U.S. engineering school is basically a good technician -- and should be paid $Y, not $X. But the "engineer" educated in the U.S. is not willing to work for $Y.
5. An engineer educated in a foreign school has many of the same limitations as the one educated in the U.S. school (particularly when it comes to English fluency), but is willing to work for $Y.
It's really that simple.
P.S. -- If a half-@ssed graduate of a foreign "diploma mill" is capable of doing a job for one of these large tech companies, then the degree requirement for that job is probably meaningless and unnecessary.
Last year Tesla in Fremont, Calif brought in a Slovenian H1B guy to DESIGN a new body contouring facility for them.
Not sweeping up the acility, mind you —DESIGNING it.
And they paid him FIVE DOLLARS per hour, 16 hour days, 6 days per week.
Then he fell and hurt himself, and they tried to rush him out of the country:
It really seems like these outfits hear about what FARMS are able to get away with and they simply want to replicate THAT.
Exactly. They need to enforce that in some meaningful way, or sharply reduce the H1Bs.
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