Think companies using H-1B visas are giving U.S. workers a raw deal? You're right.

Just in time for the latest immigration reform battle and fights over the start-up visa and increasing the number of  available H-1B visas comes a disturbing bit of news from Ron Hira, writing for the Economic Policy Institute.

Hira points out that the top 10 users of H-1B visas, firms like Tata, Infoysys and Wipro, are also big into off-shoring U.S. work. (The full list of companies is here.) He says the often-repeated claim that companies use H-1Bs as a path to permanent citizenship for immigrants is a sham.

 “In 2012, the 10 employers receiving the largest number of H-1B visas were all in the business of outsourcing and offshoring high-tech American jobs,” Hira wrote on EPI’s Working Economics blog. “Many of the jobs that went to H-1B workers should have instead gone to U.S. workers, but employers are not required to recruit them before applying for an H-1B, and can even replace their U.S. workers with H-1Bs. The top 10 H-1B employers were granted an astonishing 40,170 visas; nearly half the total annual quota.”

He told me by phone that companies like to say they use H-1B visas, visas issued to companies who say they can’t find qualified U.S. workers, to build a bridge to permanent residency. But the actions of the top 10 tell a different story, Hira says.

No company on the top 10 list has applied for permanent residency for more than 16 percent of their H-1B workers, Hira’s study shows, and figures in the low single digits is more common.

The real reason H-1Bs are attractive to big business is because companies can pay imported workers less than American workers, based on a federal law that sets the base pay for H-1Bs unreasonably low, Hira says. Although, the law itself seems to require that employers pay H-1Bs the same wage they pay their American workers.

“In reality the whole goal for these companies is to offshore as much as possible,” Hira told me. “It’s a training ground. These workers come in, they learn the job and they take the job back home, usually to India.”

I’ve often felt that the anti-H-1B crowd was a bit hysterical, but Hira’s work is hard to ignore. My guess is this sort of data is going to make things tougher for those backing a very sensible — and potentially beneficial — startup visa initiative in Congress now.

The visa would allow immigrants who raise $100,000 or more to start a business and who meet modest hiring targets to stay and work in the United States.

There is no question that immigrants are vital to Silicon Valley’s start-up culture. One oft-cited piece of research by Vivek Wadhwa and AnnaLee Saxenian concluded that more than half of the start-ups in Silicon Valley were started by immigrants.

And Hira acknowledges that immigrants are key to our innovation economy.

“I’m all for more skilled immigrants,” he told me, “but we’ve got to do it in a way that doesn’t undercut and undermine American workers and also our future ability to innovate.”

It would be a shame if these latest figures on H-1Bs drown out the voices of those making sense on the startup visa. But I can’t really see it going any other way.

(Photo: Protesters call for immigration slowdown at U.S. Rep. Zoe Lofgren’s office in 2000 — Mercury News)

Mike Cassidy Mike Cassidy (173 Posts)

I write about the culture of Silicon Valley for the San Jose Mercury News.