Social Security Inspector General, with Blinders on, Looks at H-1B Program

By David North on December 7, 2011

The Inspector-General of the Social Security Administration (SSA) has taken a look at one aspect of the H-1B program.

He brought to bear unlimited access to SSA's huge electronic earnings data system, and deployed a staff of four to dig into it. So far, so good.

But he has done so with his blinders on and, as a result, has found little of interest.

As a researcher who, from time to time, had limited access to the same wonderful data set, which covers all earnings reported to the Social Security Administration, I find the latest IG report, "H-1B Workers' Use of Social Security Numbers (A-08-11-11114)", to be deeply disappointing.

What the IG's staff did was to take a sample of Social Security numbers attached to approved H-1B petitions at some point in that process and then checked on the extent to which they were used later. The 200 files in the study had been opened in 2007, and then these numbers were matched with the wage files for 2007, 2008, and 2009.

What the IG found was that in 14 cases (7 percent of the population) there was no indication that the numbers had been used to report any wages at all in the U.S. That there were some dropouts after the petitions were approved is hardly surprising. Employers and employees change their minds; some employers and employees die; some workers get better offers. All of this is to be expected.

The other finding was that in 23 other cases (11 percent) the worker had received wages from employers other than the ones on the approved petitions, suggesting that these workers had changed employers without getting governmental permission, which is rather more interesting. The IG extrapolated the 23 to a total estimated population of 4,433 workers in the 2007 cohort with this kind of record.

The IG's report had this to say about that group of people:

As such, some of these H-1B workers may have violated their H-1B status. Although most H-1B workers had posted wages from employers that appeared to be in fields associated with technical or specialty occupations, we identified one H-1B worker who had earnings from a restaurant and janitorial service.

That's it.

This is an extremely brief report. The actual text is four pages long, and even that length relates to editorial padding such as headlines and subheadlines, nice wide margins, footnotes and the like. Four whole pages. One page each for the four writers of the report.

What really bothers me is that a golden opportunity to learn something about H-1Bs in the labor market was largely lost.

For example, of the 23 who had wages from other than their previously approved employer, how many of those had wages from the approved employer and wages from someone else? To what extent are we dealing with a little moonlighting, and to what extent is it a total job shift from an approved employer to an unapproved employer. Also, had the job-switchers shifted more than once?

Further, to what extent did the 23 who escaped from their original employer, at least in part, get higher or lower earnings than those who stayed with the original employer? Was there a difference in the nation of origin of the majority who stayed, as compared to the minority who strayed?

That American workers were shoved aside to make way for foreign workers in the program was not even mentioned.

Finally, there is no interest shown in the fact that the government was apparently cheated out of millions of dollars, if not more, in transfer fees that should have been paid with this job shifting.

In short, here was an opportunity to learn a lot about what I call the H-1B "aftermarket", those who shift jobs after their arrival in the U.S. An opportunity almost totally squandered. (I did a blog the other day about a glimpse at how that labor market worked among some H-1Bs in Missouri.)

Getting back to the slender IG report, its conclusion was that SSA should devise a data transfer to DHS on these maneuvers: the SSA accepted that notion.

There is no indication that DHS was informed of these findings before publication, nor was there a single mention of the U.S. Department of Labor, an entity that, from time to time, actually enforces the H-1B regulations.

In short, it is another one of those government reports written with blinders fixed carefully to the faces of the writers.