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So, What's the real stuff? I am writing this blog to take the first step in reading and encourage others to contribute. In this world of fake news, let's be the citizen researchers to close the gap and initiate a fact-based discourse.
Keeping some facts straight as a starting point:
Keeping some facts straight as a starting point:
- # of H-1Bs issued every year: 65,000 + 20,000 for high tech workers
- Approximate number of H-1Bs in the USA - Although there is no official figure, the rough number will be anywhere between 1-1.5Mn. In addition, the dependents will make this number 2-3Mn individuals at least.
- Key Users of H-1B: It's a mix of both software services and product companies. The following table from myvisajobs.com provides a nice picture of the various firms.
Now, Let's analyze some myths and follow that up with some real data.
Myth # 1 President's executive order on immigration bans Permanent Residents to enter the USA as well.
Reality Check: First and Foremost, the executive order applies to seven countries. It bans travel into the USA for 90 days. There needed to be more clarity regarding the Green Card holder in the order. This was clarified and corrected immediately. (Link)Now, the latest - A federal judge in Seatle puts a temporary ban on this executive order as of 3rd Feb 2017(Link)
Myth # 2 H1B visa folks will be paid $130K salary per annum - Overnight good luck!
Reality Check: There are numerous immigration reform bills tabled in the US Senate and House of Representatives. They have proposed varying annual minimum wage modifications for H-1B employees. One such bill proposed by California Congresswoman Zoe Lofgren mentions a minimum wage requirement of $130,000 for the employees of H-1B dependent employers!
We need to understand two important aspects of this -
1) The US Lawmaking process is cumbersome and involves multiple negotiations between the Senate and the House. In addition to this, there is pressure from various industry lobbies and geopolitical pressure groups as well.
2) The minimum wage requirement is applicable for H-1B dependent employers(See Wikipedia Definition). For relatively large employers, it means 15% or more H-1B employees of the US workforce. Large firms may not fall under this category.
I have analyzed proposed changes in some of the key tabled bills. Please find below a summary. I encourage others to do more research and send me the updates/additions.
Myth # 3 Premium salary for Green Card holders and US Citizens
Reality Check: There is no data to confirm this myth. There are two outcomes of these bills(if passed in current form), Employers need to pay more or hire fewer H-1Bs. In either case, the employers will do that to avoid paying the higher minimum wage mandated by the regulation. The need will be for low-cost citizens or permanent residents! However, the premium salary may be possible when there is niche skill requirement and not enough H-1B workers available in the market.
Myth # 4 Indian Software companies are doomed
However, it seems like a knee-jerk reaction before a proper analysis. There is a lot of planning to prepare for the worst-case scenario even before the bills are passed or any executive order is issued! The worst-case impact of paying $130,000 to all H-1B staff may not be as scary as it looks. Will wait for further industry analysis!
Also, Indian software companies have been preparing for this in recent times. They are sitting on Billions of dollars in cash and actively looking to acquire companies in the USA for staffing and IP/Platforms. It will be fine for them to hire a couple of thousands of local workers.
Myth # 5 IT Offshoring is over
Reality Check: This is an over-the-top reaction at a minimum. US businesses continue to be under severe cost pressure with, at best, sluggish growth for the last eight or nine years. The significant cost advantage of offshoring will continue to be the need. However, the onshore staff will see more local workers compared to H-1B over some time.
While the analysis of negative impact continues to grab the attention, there needs to be a discussion on the positives in these bills and what else can be included to provide stability and transparency in the visa system. We can always suggest these changes as well.
Some Positives -
- Provides a lot of transparency
- It is employee-friendly (minimum wage, getting the petition papers from employer etc)
- Forces industry to train and hire from local markets
- and others (others to add:-))
- Implement the restriction of the number of visas and minimum wage over some time. This will provide time for the industry to plan and implement. This will also help create a base for local workers' development.
- Work with industry to come up with ideas to improve education and training
- It's essential to think through the situations of many people who have been on H-1B for long with ongoing Green Card processing for years. Some have adult kids in college and/or are already on the job. All of them are on H-1B or dependent visas. It is a very delicate situation for those families.
- and more(open to all for suggestion:-))
There are many immigration-related websites and they publish many useful materials. Also, you can go to the congress website or the representative's website to read and suggest. I am putting some of them below:
Thank you all for reading the blog. I request that you comment, share, and provide your feedback directly to me.
