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Comment by JeremyMorgan | Hacker News Reader

While I'm all for equal opportunity, the hidden side effect I'm noticing from the H1B increase is exploitation by companies, of both the H1B holders and non holders.

Many companies and shops in the "silicon forest" have been pushing people to longer hours, they seek out H1Bs so they can get away with more and those who are not H1Bs have to comply with demands because of the threat of being replaced by an H1B.

In the end, only the big companies win from the program. That's just been my impression the last few years.

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This is untrue. If you actually look at the data, you'll find that the companies who hire the majority of H-1Bs are actually not the silicon valley usual suspects. Some of them you haven't even heard of.

If you're not in the consulting world or are not a foreign worker in the US, you probably don't know much about Infosys, Wipro, Tata consulting services, Satyam computer services, Larsen & Toubro, HCL. Yet these companies comprise the vast majority of all H-1B petitions, with average salaries ranging from 50k to the 75k, well under market for tech.

Some silicon valley firms are there, yes. IBM averages 82k, not bad for a company which capitalizes on commoditizing engineering. Then there is Microsoft, Oracle, Apple, Google, Amazon, Intel, which form a minority of petitions, and have /average/ salaries of over $100k. How is that not a competitive salary? 6 digits is not wage slavery, and these people were not compelled to settle for that, for christ's sake.

The companies have to pay 5 to 7k in legal costs and fees to get the H-1B, and even more for larger companies. And they have to wait for months for a chance to get it approved. For the former group, given how low the wages are, this is cost effective. For the latter group, it really isn't better.

Facebook, which doesn't even make the top 50 list, has been campaigning for immigration reform and has repeatedly been the target of "taking our jerbs" rhetoric, when their average foreign worker salary is around 120k.

So yes, some companies win, but not the ones you expect. Blame the right companies, and don't throw everyone under the bus.

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Data: http://www.myvisajobs.com/Reports/2013-H1B-Visa-Sponsor.aspx (yes, yes, not all LCA's files actually turn into visas, etc, but they are representative of wages companies intend to pay.)

Disclaimer: I'm on an H-1B, and I'm getting a bit sick and tired of clearing up misconceptions that keep coming up on this subject on HN. An old post on the subject: https://news.ycombinator.com/item?id=5515519

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edit: To clarify, yes, I think the legal immigration process, especially the H-1B is messed up. I think it needs to be fixed and modernized. I think it needs to be untied from company sponsorship, and the workers need to not be tied down to companies, and subject to market forces. I think there needs to be more transparency too in terms of the data. I've even proposed a policy limiting the number of H-1B workers larger companies can have, which addresses the H-1B sweatshop issue somewhat, while not damaging foreign workers. But yeah, I get mad when people talk about a subject so important to me without having any clue about the data, and reach their conclusions through political rhetoric they heard elsewhere.

You are correct that the companies who hire the majority of H-1Bs are actually outsourcing firms. You can see from the first graph and table at http://econdataus.com/h1binfo.htm that the top 11 companies in the number of H-1Bs approved in 2013 had significant outsourcing components in their business models. Eight of those 11 have their headquarters in India including the top two, Infosys and Tata. However, a number of those workers are contracted out to "the silicon valley usual suspects". I'm not sure that the data is available to determine where those workers are contracted out to.

By the way, your source at http://www.myvisajobs.com/Reports/2013-H1B-Visa-Sponsor.aspx does not seem to work. Regarding LCA's, however, I recently looked at the Labor Condition Applications that are required for each H-1B application (they are disclosed online) and posted the information at http://econdataus.com/lcainfo.htm . As you can see, very few are denied. Worse yet, the certified ones contain hundreds of errors that would seem to make them impossible to process correctly.

Regarding your contention that "Facebook, which doesn't even make the top 50 list", the table at http://www.computerworld.com/article/2489146/technology-law-... shows that they actually were number 25 with 337 H-1B's in 2013. That don't believe that counts any that they may be contracting from outsourcing firms. In any case, Zuckerberg may want to lift the cap so that he can catch up with the big boys.

Regarding Silicon Valley, I've posted tables and graphs at http://econdataus.com/h1bage.htm that show the huge number of non-citizens (likely H-1B's and some green card workers) working there. Also, it shows that the ages of non-citizens working in the industry spikes sharply in the 31 to 35 year range. This demand is likely motivated by the fact that young workers are cheaper, easier to take advantage of, and can be dumped for a new batch of young workers when their visas run out and/or they start standing up for themselves.

Hey, thanks for being the first well thought out response. I don't have much time right now but let me give a few quick thoughts regarding your analysis:

I don't know what you mean by the fact that the source doesn't work - the website works fine. Here's a google cache of the page: http://webcache.googleusercontent.com/search?q=cache:http://... And yeah, most LCAs are approved but not every approved LCA turns into a visa. The visa itself can be denied, or the company can decide to not file for a visa, and in this regard we don't know what we don't know in terms of how often this happens.

I am skeptical of the table you show from computerworld.com, but it is top /approvals/ not applications. Which points to the endemic issue even more of IT consulting firms doing the spray-and-pray approach of making a billion applications. But even then, facebook being #25 means nothing - they account for approx 1% or less of all applications, even when you count approvals only.

And again, 31 to 35 is not the young part of the software engineer group. Facebook, Google, Amazon, Microsoft etc have a HUGE presence in college career fairs, especially in top schools, where they poach 22 year old new graduates. That's the young end of the market likely to be willing to work for cheap, not the 30 year olds. And besides, there's exogenous effects - why would an old person move to a different country? Of course it's the youngsters that leave their country to move to silicon valley, the mecca of tech. You could hypothesize that, for example, youngsters in the US don't need to move as much because they already live near other tech centers like NY, Boston, Boulder, etc. Whereas when foreigners move to the US, they tend to move towards a place with a brand name like Silicon Valley.

PUMS is an interesting source for this - I think recently Web Developers are being classified separately in NAICS - have you accounted for that?

> I am skeptical of the table you show from computerworld.com, but it is top /approvals/ not applications. Which points to the endemic issue even more of IT consulting firms doing the spray-and-pray approach of making a billion applications. But even then, facebook being #25 means nothing - they account for approx 1% or less of all applications, even when you count approvals only.

As I said, however, I don't believe that the data shows how many H-1B contractors are be working at Facebook. I rechecked and the LCAs posted online only seem to list the employer and the city in which the employee will work. If they are contracted out, the company to which they are contracted is not shown. In any case, my problem with Zuckerberg is not the number of H-1Bs that he's hiring. It's that he's using the phony issue of a shortage in STEM skills to push for a higher cap. The great majority of commentaries at http://econdataus.com/skillsgap.html , including an editorial by Paul Krugman, suggest that the STEM skills gap is a myth. On that topic, an interesting article was just posted at http://www.usnews.com/opinion/articles/2014/09/15/stem-gradu... .

> And again, 31 to 35 is not the young part of the software engineer group. Facebook, Google, Amazon, Microsoft etc have a HUGE presence in college career fairs, especially in top schools, where they poach 22 year old new graduates. That's the young end of the market likely to be willing to work for cheap, not the 30 year olds.

30-year old H-1B visa workers are beholden to the companies for which they work. This is one reason that companies like them. Also, I saw another part of that problem when I was working for a company that had to move out of Silicon Valley. They took just about all of their H-1B folks with them but laid off most of their employees who were citizens. Now, I didn't really mind myself since I wasn't planning on moving with them anyhow. But I believe that they kept their H-1B employees partially to be "nice", because the H-1B visas would be in jeopardy if their jobs ended. It made it more clear to me that, if you have two tiers of employees where one tier is beholden and the other is not, it will negatively affect all employees.

> PUMS is an interesting source for this - I think recently Web Developers are being classified separately in NAICS - have you accounted for that?

Yes, I added a list of the job classifications, including Web Developers, at http://econdataus.com/h1bage.htm . As you can see, they are included in the "All Computer Workers and Management" numbers. By the way, I did a quick check and there were 3,485 Web Developers in Silicon Valley in 2013 versus 62,600 Software Developers, Applications and System Software. In any event, the graphs show that the hiring of H-1Bs is much higher in Silicon Valley making the bias toward youth especially severe. I wrote a letter about the problem here to my representative and posted it at http://econdataus.com/h1bletter.htm . If you have any comments on that, feel free to share them.

It does NOT matter what the average/median salary is (although you might argue that even 100K in SV is not that much). What _matters_ is - what would the salaries have been, if it were not for the mass import of workers from India. You don't need to be a genius to know that more supply => lower price. I am always amazed that many supposedly bright engineers miss this very simple correlation.

Glassdoor.com, which is the most decent salary source I can think of right now, lists Microsoft Software Development Engineers' average salaries as $94,387 with 6000 data points. Software Development Engineers in Test are lower at 84k and 7000 data points. Take from that what you will regarding how much of a wage reduction that would be causing.

Let's look at it from a different perspective. There are 1 million software developers in the US alone: http://www.bls.gov/ooh/computer-and-information-technology/s... There are 22 million stem employees in the US as of 2013: http://www.nsf.gov/statistics/infbrief/nsf13311/ The hand wringing here is about 85 thousand a year, a quota which was maxed out /only once/ before last year. A drop in the ocean. And somehow this is the reason US STEM graduates aren't employed in STEM fields, the reason why STEM isn't growing, the reason to blame for everything, etc etc.

Don't know about the whole STEM industry, I can only offer anecdotal evidence: almost every big corp I consulted for had FLOORS of Indian people, many of whom barely had community college - equivalent diploma.

H1-B has its place, but is should be reserved for REALLY qualified people - say the ones with MS or Ph.D in sciences who graduated from American universities.

Considering its the only real option for anyone in China/India to work in the US, what would you replace it with? Or do you prefer they stay right where they are?

All I am saying is that importing a small number of really bright, highly educated MS and PhDs _is_ beneficial to _everybody_ in the US(creates jobs, etc). Yes, it is brain drain.

I am not sure why the US needs to provide work places for Chinese and Indian citizens? There are many US citizens who need a job these days.

I don;t think I am being insensitive - most countries are very protective of their job markets. Try to get a work permit in France or Europe if you are not from a EU country.

I understand your morals could be different from mine but heres how I see it.

A Chinese or Indian citizen is an individual, like any other, just like you even. Through no fault of their own they've been born in a country that doesn't provide the same quality of life for them and their family that an American/EU resident enjoys. Don't they have the right to the pursuit of happiness just like you?

For an extreme example, would you rather be a Chinese Foxconn employee or an unemployed American. ( http://en.wikipedia.org/wiki/Veil_of_ignorance )

Which is why we are so much poorer these days than 100 years ago with way fewer people.

http://en.wikipedia.org/wiki/Lump_of_labour_fallacy

Also: if you keep all those people out, the companies will end up going where the talent is.

Anyway, I flagged this article - it's politics.

> Which is why we are so much poorer these days than 100 years ago with way fewer people. http://en.wikipedia.org/wiki/Lump_of_labour_fallacy

I don't buy the notion that every H-1B visa worker creates jobs. Taking the fact that some of the most talented individuals who come in under H-1B create jobs does not mean that they all do or that they create jobs on average. That is the Fallacy of composition described at http://en.wikipedia.org/wiki/Fallacy_of_composition as follows:

"The fallacy of composition arises when one implies that something is true of the whole from the fact that it is true of some part of the whole (or even of every proper part)."

> Also: if you keep all those people out, the companies will end up going where the talent is.

No, many of those hotshot CEOs (many of whom, like Zuckerberg, were born on third base) would have already moved all of their operations overseas if cheap labor was their only goal. They realize there are problems with doing that. First of all, they would have to constantly travel to the foreign sites to meet with the natives. They are also likely aware that it would just be a matter of time before the natives found a way to overthrow their American overlords and install their own people in charge. Finally, they realize that it would look unpatriotic and greedy to move their entire operation overseas. Instead, they just seek to buy influence in Washington D.C., push to loosen the H-1B laws to bring in more cheap labor, and make phony claims that this is necessary because there aren't enough American workers to allow their genius to take full bloom.

1. It is primarily economics (though politics is always involved when it comes to money).

2. I understand that the IT market has grown immensely over the last 20 years, needing more people, it is not a zero-sum game, however:

3. If the job market was allowed to be free within the US, compensation would go way up, due to actual (not imaginary) labor shortage

4. More young people would be lured to pursue all things STEM/IT

5. The market would find its equilibrium

We apparently have a shortage of CEOs, judging by their salaries exploding. Do we have an H1-B program for CEOs?

I don't know if this is really true, since it's something someone at work just told me with no references or anything, but there's also another problem with these Indian consulting companies. Apparently they request loads of H-1Bs for their employees in India "just in case" one of them is to be sent to the US. They kill the cap and in the end a lot of those people don't even come here.

If this is really true, they should create a per-country cap for H-1Bs, the same way it is done with Green Cards.

who ever said was supposed to be good for workers? remember that the US is the only country to still allow at-will employement... it doesnt care even for the native workers.

those laws are justifyed as "if we dont get those visas we open offices elsewhere and you dont get our taxes". then congress/states allow the conditions the conpanies demands and they avoid taxes anyway via income routing in ireland or who knows where.

I've seen this first hand. It does happen.

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