State Department Regs Guarantee Loss of 120,000 American Jobs

By David North on April 28, 2011

I suppose it is progress when one of the State Department's alien worker programs decides that foreign college students can no longer be used as rickshaw operators, or in their words: "as pedicab or rolling chair drivers".

It certainly is a refreshing bit of transparency when the department admits that its Summer Work Travel program had sometimes been used to staff "money laundering, money mule schemes and Medicare fraud", though no details are provided.

The proposed DoS regulations for this program also speak of "documented reports of aliens either knowingly engaging in or becoming hapless victims of and accessories to criminal activities" within the program.

Further, and importantly, these rules guarantee that 120,000 summer-time jobs will be denied people studying in American colleges and universities (both citizens and international students) and will be given, instead, to foreign college students who will work for an assortment of employers linked to the J-1 Exchange Visitor Program.

Some of the problems of this on-going program were described in an earlier blog of mine entitled "Mr. Obama: You Can Create 100,000 Jobs for Americans with a Pen Stroke." The State Department now estimates that 120,000, not 100,000, jobs are at stake.

In an effort to pretty up the program, without touching its central labor market impacts, the Department has proposed modifications of its regulations, and has published them in the Federal Register for comment by June 27.

As noted earlier, this is the State Department's own foreign worker program, and it apparently operates without any interactions with either the Departments of Labor or Homeland Security, each of which has its own foreign worker program, the H programs in Labor, and O and R, among others, in DHS. Some of these, notably those in the Labor Department, sometimes have better labor market protections for the foreign workers, and sometimes, even, provisions for protecting American workers from unfair competition from alien workers. State does not do as well.

One of the remarkable aspects of the proposed DoS regulations is a list of occupations that are no longer allowed for these summer workers, a listing that suggests, in a backhanded way, that in prior summers some of the college students were so employed. In addition to rickshaw drivers, these are the other banned occupations:

  • positions in the adult entertainment industry

  • sales jobs that require that the workers buy goods that they must sell to support themselves

  • jobs as servants in private homes

  • work as vehicle drivers where commercial licenses are needed (maybe the Teamsters weighed in on that one)

  • jobs in clinical care "that involves patient contact"

  • and, most important, jobs "that could bring notoriety or disrepute to the Exchange Visitor Program" and thus to the State Department.

That little list is a wonderful window in what must have happened in that program in the immediate past.

As often is the case with the State Department there is a strong recognition of class in the new regs, but this time with a different twist.

In the case of diplomats there are A-1 visas for ambassadors, other major diplomats, and their families, A-2 visas for lesser diplomats and their families, and A-3 visas for attendants and servants of those in the A-1 and A-2 categories. Aliens in the 1 and 2 categories get their visas without interviews, but the A-3s are both interviewed and fingerprinted – thus all diplomatic visas are not created equal.

In the summer program people from the wealthier nations, those in the visa-waiver program (such as most nations in Northern Europe), get fewer protections than those in the rest of the world. For the latter group, and because of past problems, all the summer workers must have pre-screened jobs before they arrive. This protection is not extended to people from the visa-waiver countries, who are regarded as less likely to be victimized.

Exchange students arriving expecting to work, in the past, often wound up without jobs, so State tightened the rules this year to minimize that problem, a commendable part of the revision.

While much of the thrust of the new regulations is on protections for the exchange students, many of whom must have been badly treated on the job in the past, and on more vetting of the jobs and the program generally, labor market protections are treated rather casually.

For example, the only reference to the enforcement of the minimum wage is that employers of these workers are to inform their workers of the law, a minuscule step at best; there is no agreement, as there might be, that DoL's minimum wage inspectors would make unannounced audits of work sites.

For example, employers are expected to "provide program participants with the approximate number of hours of paid employment per week that the employers had [previously] agreed to".

Similarly, workers will be placed only with "host employers that materially comply with all ... occupational health and safety laws." Note the omission of labor standards laws in this sentence. (Emphasis added in both quotations.)

While the 20 pages of proposed regulations speak in great detail how they interact with the Administrative Procedures Act, the Small Business Regulatory Enforcement Fairness Act, the Paperwork Reduction Act, and even with requirements for consultation with Indian tribal governments, there is not a word about how the program plays out in the American labor market, and how many jobs are lost to U.S. workers as a result.

My suggestion would be that the program be suspended until unemployment in the U.S. goes below a certain level, say, 8 percent.

While it is temporarily out of commission, no one would need to worry about foreign college students, in a State Department-approved program, being ushers in porn movie theaters or operating pedicabs.