Partial Joy: Some of the Exploitative J-1 Programs Are Being Reviewed

By David North on September 6, 2017

According to the National Law Review, the Trump administration is said to be reviewing five of the J-1 (exchange visitor) programs that relate primarily to private sector employers.

These five programs facilitate the importation of low-cost, docile workers as au pairs, camp counselors, interns, trainees, and most important, as aliens in the Summer Work Travel (SWT) program. They also lower wages in the areas where the J-1 visa holders work and shoulder aside some 160,000 American workers a year.

Further, as the NLR article does not report, employers of the five categories of visa holders are subsidized by the U.S. government to hire these young aliens — rather than Americans — because neither the employers nor the workers are required to pay the 7.65 percent payroll taxes that fund the Social Security and Medicare programs. If they hired Americans, they would have to pay the 7.65 percent.

So we have America's elderly indirectly paying American employers to not hire American workers through these programs. Eliminating these J-1 programs would help shore up both the Social Security and the Medicare trust funds.

All of these J-1 programs operate under a mask of "cultural exchanges"; all benefit specific subsets of employers, and all are organized by well-paid middlemen and supported by their lobbyists.

While the first four of the J-1 programs generally operate under the radar, SWT's exploitation of young aliens, and the loss of jobs to young Americans, was described in vivid detail in a series of articles by my colleague Jerry Kammer a couple of years ago (see here for his long study of the topic, and here for a list of other articles).

These five J-1 programs collectively involve serious numbers of people, though some of the schemes are larger than others. The best estimates for these numbers, something the government does not publish, are from Daniel Costa of the Economic Policy Institute. His rounded estimates for 2014 are:

  • Summer Work Travel: 90,000
  • Intern: 23,000
  • Camp Counselor: 20,000
  • Au Pair: 16,000
  • Trainee: 10,000
  • Total: 159,000

What could be a more traditional American job for a youngster than babysitting (which is what au pairs do), working at a summer camp, or getting a job at the beach (a big activity in the SWT business)?

But some employers push aside these traditions as they look for cheap labor.

The lawyer author of the NLR article, Matthew Kolodziej, of the multi-location Ogletree, Deakins, Nash, Smoak & Stewart firm, writes in his conclusion:

[E]mployers using the exchange program may nevertheless want to consider other visa options for J-1 employees and other immigration programs and contingency plans in case the J-1 program becomes unavailable or unworkable.

Why didn't Kolodziej mention the obvious alternative to hiring from one of the five listed J-1 programs: Hiring Americans? Maybe this is cynical of me, but the reason might be that typically an employer does not need the services of an attorney when hiring an American, but one often does when using the nonimmigrant worker programs.

Public-Sector Employers. The administration seems to be looking at these five component parts of J-1, but not at five others that benefit public-sector employers like universities and public school systems. It may be a shrewd political decision on the part of the administration not to add to their list of opponents by also seeking justice within the J-1 programs for professors, university researchers, public school workers, and others.

Or it may be that the administration believes the client-serving observation of the writer: "The other [J-1] categories which do not involve 'work' are reportedly not affected."

Of course, J-1 professors and public school teachers do work, and take jobs — often at reduced pay — that U.S. residents could fill, but it is inconvenient to say so.

I noted in a recent blog that the public school system in the U.S. Virgin Islands, desperate for both funds and for teachers, is turning to the J-1, rather than the H-1B program, because J-1 allows the school bosses to be more exploitative.

At least in H-1B, the employer and the worker both pay their payroll taxes; this is one of the few positive things that one can say about H-1B.