Orlando Sentinal, January 25, 2016
During the presidential campaign, Donald Trump put forth a radical idea: Let's stop replacing Americans with foreign workers.
This sounds obvious to ordinary Americans, but in a Washington controlled by lobbyists and lawyers, it is a totally alien concept.
This issue hit home in the Orlando area when hundreds of American computer programmers employed at Disney had to train their foreign replacements imported through the H-1B visa program. What happened at Disney was not an isolated incident. The same thing has been happening at other companies for decades and has continued at Toy R Us, New York Life and Abbott Labs as subsequent examples.
H-1B was created in 1990 as a guest-worker program for aliens in occupations that normally require a college degree. Each year about 125,000 new H-1B visas are approved. About 70 percent of the visas go to Indians, and about 60 percent of the visas are for computer occupations.
How is it possible that employers can replace Americans with foreign workers?
Make no mistake about it: The very purpose of the H-1B program is to replace Americans with cheap foreign workers. What happened at Disney was not the result of loopholes, abuse or accident. It was the product of deliberate statutory design. Congress has affirmatively enacted legislation to ensure that it is legal for employers to replace Americans with H-1B workers.
At the time one member of Congress promoting the bill boasted, "This is not a popular bill with the public. It's popular with the CEOs. ... This is a very important issue for the high-tech executives who give the money."
Money drives Washington these days, and H-1B is all about money. A massive replacement of Americans by H-1B workers like at Disney equates to hundreds of thousands (sometimes even millions) of dollars in fees to immigration lawyers. The average wage for a computer programmer in Orlando is $72,966 year. Yet an employer can legally pay an H-1B programmer in Orlando $47,299. Companies save in direct labor costs by using H-1B and the legal and visa fees are a fraction of the wage differential.
The fact that companies like Disney are able to fire hundreds of technology workers and find foreign replacements for them demonstrates what the empirical data show:
There is no shortage of technology workers that justifies the H-1B program. For comparison, the current unemployment rate for computer programmers is 2.6 percent while the unemployment rate for lawyers is 1.4 percent. If there is a shortage of computer programmers, then there must be a massive shortage of lawyers in America. Does anyone want to make that argument?
The great irony in H-1B is employers call the workers "highly skilled" or "foreign talent" when they want more of them, but these very same workers become low skilled when it comes time to pay them. H-1B uses a skill-based prevailing wage system. The employer identifies the worker's skill level and has to pay a corresponding wage. Under this system, employers classify most H-1B workers at the lowest skill level and nearly all of them at the lowest two skill levels where these workers' skills do not even command the average wage.
Worse yet, the H-1B program is the engine for moving technology jobs overseas. The largest users of H-1B are companies that specialize offshoring work. They use H-1B visas to provide on-site support while most of the work gets moved to foreign countries. Typically, each H-1B worker here supports six more jobs moved offshore.
H-1B is a microcosm of all that is wrong in Washington these days. It should not be legal under any circumstances to replace Americans with foreign workers. For the first time in decades, America has elected a president agrees with the public on that question. Let us hope President Trump follows through.