Professor Investigates Corporate Rhetoric on H-1Bs

By David North on February 26, 2010

We often read about how the nation's high-tech corporations say they use the H-1B program to bring the world's best and brightest to the U.S.

But is that how they really use the program? Only some of them do, according to Prof. Ron Hira of the Rochester Institute of Technology; the rest use it as a handy source of relatively low-cost talent.

Hira, who is both a PhD in public policy and a certified Professional Engineer (PE), a rare and interesting combination, has written an intriguing paper on the differential use of the H-1B program, and of permanent labor certifications, by different types of corporations.

The H-1B and L-1 nonimmigrant programs both bring overseas tech workers to the U.S. for periods of five, six, or seven years, depending on the visa. He estimates that there are, at any given time, about one million of these workers in the United States, all working under essentially bonded conditions.

He quotes Carly Fiorina, the one-time Hewlett-Packard chair and policy advisor to John McCain during his presidential bid, as saying that the H-1B program should be modified so that it allows "smart, hardworking people to come into this country, and it should be our goal to get them to say here forever."

Hira examines, using government statistics, what specific, large-users of the H-1B, the L-1, and the permanent labor certification programs do with those programs.

He finds that the big firms that are offshore outsourcing firms (think of Tata) are highly unlikely to convert their H-1B and L-1 workers to permanent resident alien status. In fact, Tata, one of India's largest corporations, in 2008 had 1,539 approved H-1Bs, and 1,998 approved L-1s, and did not seek a single permanent labor certification.

On the other hand firms with "traditional business models," i.e., doing little outsourcing (at least so far), such as Microsoft, handle things differently. In 2008 Microsoft, the fifth largest of the H-1B users, received permission to hire 1,037 new H-1Bs, while getting labor certifications for 703 people (most of whom were then working in H-1B status.)

Goldman Sachs and its thunderous bonuses, on the other hand, does little to hold on to the nonimmigrant workers that its chair, Lloyd Blankfein, has described as the most highly trained and talented people in the world. The Wall Street firm got 211 H-1B visas in FY 2008, and sought only 13 permanent labor certifications. Did any of the 211 or, more likely, the 13 get those bonuses? The government's data does not cover that point.

Hira reports that in FY 2008 the country admitted more than 214,000 new H-1B and L-1 workers, but only about 38,000 of the aliens in those two classes (who had arrived earlier) were converted to permanent resident alien status via labor certifications. (Some others, as he does not mention, presumably got green cards by marrying green card holders or U.S. citizens.) So only a small minority of these two classes of nonimmigrant workers made it into the permanent resident alien status that year, a ratio that is likely to persist.

He summarizes: "In sum, the guest worker program has become bifurcated, with some employers using the H-1B and L-1 visa programs as a bridge to permanent immigration, while other employers use it simply for temporary labor mobility ... to take advantage of cheaper guest-worker labor."