Media coverage of the regulatory changes has been muted and often echoes businesses’ demand for cheap imported labor. For example, the
Los Angeles Times’ Molly O’Toole wrote on October 9:
Apart from concerns that too many H-1Bs have gone to Indian-owned outsourcing firms, critics say the program displaces American jobs and depresses wages. But while studies have suggested that can happen when there’s excess labor in lower skilled occupations, there’s little evidence of such effects in fields requiring high-skilled workers.
The article, which had only 13 comments on October 11, portrayed the visa workers as “immigrants,” and said the federal government allows the inflow of 85,000 H-1Bs per year.
In reality, the federal government approves roughly 100,000 H-1Bs per year and also estimates the resident H-1B population at almost 600,000.
Other estimates say the H-1B resident population may reach a million, including at least 100,000 spouses with H-4EAD work permits.
That number is very large. Roughly 800,000 Americans graduate from four-year colleges each year with degrees in business, healthcare, science, software, or math.
The H-1B workforce works in three roles.
Some of the H-1Bs arrive for a year or so of training by Americans, after which they are sent home to India to perform the work at low wages.
Some H-1Bs are paid high wages, usually by elite tech firms, sometimes by hospital chains. These inflow of these
better-paid H-1Bs will likely be unaffected by the new rules.
At least 400,000 H-1Bs work as subcontractors for other firms, usually for the Fortune 500 firms which are trying to cut payroll costs by outsourcing routine work. This group is likely to be hit hard by the new rules.
But the new rules will not directly impact foreign workers who arrive under different visas or work-permit programs, such as the Optional Practical Training (OPT) program.
Overall, the federal government allows companies to keep roughly 1.3 million foreign contract-workers in white-collar jobs. They arrive via the H-1B, J-1, L-1, H4EAD, OPT, CPT, TN pipelines. They are also supplemented by a shadow economy of gig-worker white-collar illegals, including foreign graduates who overstay their visas or enter the country on B-1/B-2 visas.
Many of the visa workers — especially the illegal gig-workers —
accept low wages, in part, because many are working in exchange for their employers’ promise to sponsor them for the massive prize of green cards. Once sponsored, the visa workers can stay long past their visa expiration date while waiting for a green card. This legal opportunity to pay white-collar workers with green cards has created a “ Green Card Economy” of Fortune 500 employers, universities, and subcontracted, gig-worker foreign employees, so cutting many Ameican graduates out of entry-level jobs.
The H-1B reform may shrink the underlying Green Card Economy
if they ensure that only higher-paid workers can get into the H-1B program — and if officials reverse the “ early filing” rule adopted in late September.
But the impact of the new rules will likely be muted — or even eliminated — by industry’s response.
Industry groups are expected to ask judges to strike the program down. Already, industry lawyers have blocked – likey, temporarily — Trump bar against the entry of H-1B, J-1, and L-1 workers before January.
Industry groups also claim the federal government
miscalculated and inflated the needed wage levels by 26 percent.
have dismissed Trump’s reforms.