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The H-1B visa program, as currently structured, was created by the Immigration Act of 1990. This program allows U.S. companies, universities, hospitals, school districts, and state and local governments to hire skilled foreign nationals for up to 6 years. 

H-1B visa holders must have at least a bachelor’s degree or equivalent work experience, and be paid the prevailing wage for their profession as determined by the Department of Labor. U.S. companies must ensure that H-1B visa holders are provided the same benefits and working conditions as all other employees. 

Employers are also required to post a notice to their workers that an H-1B visa holder has been hired, which must include the salary of the H-1B visa holder. Finally, employers cannot hire H-1B workers during a strike or lock out. 

For more information on worker protection, please visit the Department of Labor website:

http://www.dol.gov/compliance/guide/h1b.htm

July 19, 2007 - Letter in support of the Cantwell Amendment

H-1B Visas

H-1B visa holders are a small, but critical part of a high-tech company’s workforce. 

Rapid employment growth and need for skilled employees is causing the H-1B visa cap to be reached each year. As new companies continue to grow and as technology advances, the demand for high-skilled workers is becoming increasingly urgent. 

This unprecedented growth has resulted in a serious problem for the high-technology industry in particular – the inability to find and retain qualified workers. Foreign nationals holding H-1B visas help address this critical shortage. However, even if there were no shortage of qualified workers, AeA would continue to support increases to the H-1B visa program, as this visa allows access to the best and brightest individuals from throughout the world.

L Visas

The L Visa allows companies to transfer employees temporarily into the U.S.  The L-1 Visa is critical, as it allows companies to bring in, on a temporary basis, individuals that can help open foreign markets to U.S. high-tech products.

There are two types of L Visas: the L-1A Visa, which allows companies to temporarily transfer executive and managerial employees into the U.S.; and the L-1B Visa, which allows companies to temporarily transfer employees into the U.S. with “specialized knowledge.”

Most large AeA members use this visa, especially those companies that operate outside the U.S.

Several bills have been introduced in Congress to restrict – by varying degrees – the ability of companies to use the L Visa program.

Employment Based Green Cards

Employment-based (EB) green cards are provided to foreing nationals who are seeking permanent residence and are sponsored by employers to work in the United States. EB green card holders are well-educated job creators who must pass strict labor market tests in order to be eligible for admission.

• Expedite the visa approval process for companies that have a proven H1-B compliance record.

• Address the problems arising from the "per country" limits on business immigration.

• Promote education and training policies that develop a highly skilled American workforce.

• Dedicate filing fees to enhance education in needed fields and to improve case processing and program management.

• Strengthen enforcement to eliminate fraud without placing new burdens on legitimate users of the H1-B program.

Read AeA's 2006 Policy Priority for High-Skilled Visa Reform.

• Nearly 50% of all H-1B beneficiaries possess a bachelor’s degree or higher and 31% hold at least a master’s degree.

• At U.S. universities 50% or more of the post-graduate degrees in science, math, and engineering are awarded to foreign nationals.

• To hire H-1B professionals, U.S. companies must meet strict Department of Labor criteria to protect American workers.  Employers must pay H-1B beneficiaries the prevailing wage level for the occupation classification in the area of intended employment.  The employer further attests that these nonimmigrants will be offered benefits and eligibility for benefits on the same basis, and in accordance with the same criteria, as offered to U.S. workers
  http://www.dol.gov/compliance/guide/h1b.htm

• Employers must pay an education training fee of $1500. Over the last eight years, U.S. employers have paid more than $1 billion in fees, funding more than 40,000 scholarships for U.S. students in math and science, supporting science programs for 75,000 middle and high school students and training more than 82,000 U.S. workers.

• While the contributions made by highly educated foreign professional are innumerable, H-1B professionals constitute a low percentage of the U.S. workforce.  During the economic boom of 2001, when H-1B usage was at its height, these temporary professionals still accounted for only about 1/10 of 1% of U.S. non-farm employment.

H-1B visa holders bring unique skills to high-tech companies, help high-tech businesses access foreign markets, provide training to American workers about foreign markets, and help fill temporary worker shortages. Most high-tech companies that use the H-1B visa program hire a very small number, especially when compared to their total number of employees. Overall H-1B visa holders provide critically needed skills to high tech companies. 

This program has benefited the high tech industry by allowing the best and brightest from throughout the world to create new products, implement new manufacturing processes, train American workers, open new foreign markets, and created thousands of new jobs here at home.

One of the most overlooked aspects of the high-skilled immigration program is how many jobs they create. Co-founders from Intel, Sun Microsystems, Yahoo!, eBay, Google, and hundreds of lesser known companies are foreign-born. Nationwide these immigrants founded companies that produced $452 billion in sales and employed 450,000 workers in 2005.

Myth: High-Tech companies are laying off people.

Fact: The high tech industry has added 250,000 net new jobs in the last two years. More jobs are out there as high-tech companies are having problems filling positions

Myth: H-1Bs are a vehicle for cheap labor.

Fact: Some companies, though few, do use H-1Bs as a vehicle for cheap labor. Though these companies are the exception rather than the rule, they clearly have abused the system and should be punished. The tech industry fully supports enforcement provisions that go after abusers of the system.

Myth: Hiring an H-1B worker means one less American worker being hired. Overall, this is a zero sum game.

Fact: One of the most overlooked aspects of the H-1B program is how many jobs they create. Co-founders from Intel, Sun Microsystems, Yahoo!, eBay, Google, and hundreds of lesser known companies are foreign-born. Nationwide these immigrants founded companies that produced $452 billion in sales and employed 450,000 workers in 2005.

Myth: U.S. High tech companies are not hiring American kids

Fact: There is a dearth in U.S. students in these fields. 1 of every 4 scientists and engineers in the United States is foreign born. Half of Doctoral Computer and Science and Math degrees and 60% of doctoral engineering degrees awarded in the United States go to foreign nationals. Lastly, the unemployment rate for all engineers in the U.S. is 1.8%.

Q. What are the Unions Saying About high-skilled immigration reform?

A:  Union groups believe that more H-1B visas mean fewer jobs for American workers.  These types of arguments are quite typical, but as the extremely low unemployment numbers for engineers (1.8%) show the arguments are flawed.   In fact, an unemployment rate below 4% is considered full employment.

Q: Is it not true that foreign nationals steal American jobs?

A:  Not only do these individuals not take American jobs, they create them.  Foreign-born immigrants are among this country’s most prolific job creators.  Highly skilled educated people create innovation and innovation creates jobs. 

• Co-founders from Intel, Sun Microsystems, Yahoo!, eBay, Google, WebEx, and hundreds of lesser known companies are foreign-born. 
• Overall, in 25.3% of technology companies, at least one key founder was foreign born.  Specifically, in the semiconductor industry, the percentage was 35.2%. 
• Nationwide these immigrants founded companies that produced $452 billion in sales and employed 450,000 workers in 2005. 

What is clear is that immigrants have become a significant driving force in the creation of new businesses and intellectual property in the U.S. and their contributions have increased over the past decade.

Q: Are there not an abundant of American workers to fill the jobs that H-1B recipients are taking?

A: No.  Visit the website of many American technology companies and you will find thousands of unfilled, U.S.-based positions.  Foreign nationals are critical for filing this void.

• In fact, the unemployment rate for computer and math occupations was at 2.5% in 2006, for computer and information systems managers the unemployment rate was at 2.3% in 2006, for electrical engineers it was at 1.9%, and for computer programmers it was at 2.6%. 

• In addition, the number of engineering degrees awarded in the United States is down 20% from the peak year of 1985.  In 2001, only 8% of all degrees awarded in the United States were in engineering mathematics, or the physical sciences, which is more than a 50% decline from 1960. 

These low graduation numbers in combination with high-tech industry seeing an increase of overall employment by 146,600 jobs in 2006 has created a shortage of available high-tech employees in the United States.  

Q: Is the H-1B program a way for companies to hire cheap foreign labor instead of American workers?

A: No.  Critics falsely contend that employers use the H-1B program to exploit cheap labor.  They believe foreign nationals, desperate to remain in the United States, will accept lower than the market wage for their position.  But the reality is that foreign visa holders are acutely aware of what they are worth and demand a competitive wage

• A 2006 report by the National Foundation for American Policy (NFAP) uncovered the methodological flaw of the Center for Immigration Studies (CIS) report that concluded that H-1B programmers were paid less than their U.S. counterpart

• NFAP found that CIS vastly underestimated H-1B wages because it failed to control for age and work experience, as H-1B professionals tend to be younger than their American counterparts

• Research conducted by the Department of Homeland Security showed that 65% of petitions approved for H-1B recipients were for workers between the ages of 25 and 34. 

• The NFAP found that the actual wages paid to the programmers were 22 percent higher than the prevailing wage.  Further research conducted by the Center for Labor Market Studies at Northeastern University found that foreign-born and American-born professionals earned virtually identical salaries in math and science fields.

• Lastly, according to a Government Accounting Office report, employers polled say fees associated with application for permanent residency can raise the cost of hiring an H-1B worker substantially, with costs as high as $10,000 to $20,000.

Q. What protections are available for American workers when companies hire H-1B workers?

A.  American workers have numerous protections under the current laws:

• It is technically illegal for employers to fire Americans and replace them with H-1B workers.  In addition, the Department of Labor is responsible in checking to make sure there are no strikes or lockouts in which H-1Bs are being hired instead of American workers.

• The law requires employer to pay H-1B workers the prevailing wage.  The employer further attests that these nonimmigrants will be offered benefits and eligibility for benefits on the same basis, and in accordance with the same criteria, as offered to U.S. workers

• The Labor Department is responsible for ensuring that the hiring of foreign workers will not adversely affect the wages and working conditions of U.S. workers or displace U.S. workers.

Q.  What are your opinions about the bad guys who violate the system? 

A. The tech industry supports punitive measures against the small number of firms who have been found to exploit the system. The vast majorities of companies play by the rules, pay market wages, and do not wish to see the integrity of the program called into question by a minority of violators.  AeA believes that the laws should be enforced strictly and violators should be prosecuted to the full extent of the law.

AeA has been meeting with key members of the Administration, House, and Senate to encourage a re-evaluation of the current system and help shape some type of solution to help fix the problems associated with high skilled immigration reform.

Tell Your Congressman & U.S. Senator to Support
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On August 17, 2005, an opinion editorial by William T. Archey, AeA President & CEO, on immigration reform ran in the San Jose Mercury News and was carried in 15 other newspapers around the country. To view the article, go to www.aeanet.org/mercoped.

	Losing the Competitive Advantage?: The Challenge for Science and Technology in the United States, AeA's latest research report, explores the challenges the United States currently faces and in many ways is ignoring at its peril.
	Attracting the Best and Brightest to the United States Though recent public debate has focused on unskilled, illegal immigration, an entirely different but essential category is often neglected: the high-skilled, legal immigration that spurs American innovation and creates thousands of high-paying jobs. June 2006

John Palafoutas
Senior Vice President
Domestic Policy and Congressional Affairs
601 Pennsylvania Ave, NW
Suite 600, North Building
Washington, DC 20004
P: 202.682.4451
F: 202.682.9111
john_palafoutas@aeanet.org

This page was last updated on 05/20/08.  
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