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H-1B visas produce net IT job boost, trade group says

Compete America argues that Congress's refusal to hike H-1B caps hurts IT job creation

March 19, 2014 04:07 PM ET

Computerworld - WASHINGTON -- The high-tech industry contends that Congress's failure to raise the cap on H-1B visas is costing the U.S. an opportunity to create a new job every 43 seconds.

To make its point, Compete America, which represents many major high-tech companies on immigration issues, has built a calculator that ticks away jobs that it says are lost, or not created, because of visa restrictions.

"Immigrants have long been a really important part of America's talent pool that drives innovation, creates new jobs and ultimately, creates higher standards of living," argued Matthew Slaughter, an economist at the Tuck School of Business at Dartmouth College, at a Compete America press conference Wednesday.

Slaughter said restrictions on H-1B use have cost the U.S. economy 100,000 new direct jobs over the past year, a figure that rises to 500,000 when indirect jobs are added. In total, the group estimates each H-1B worker helps create an additional four direct and indirect jobs, and that U.S. job creation would have been 21% higher in the U.S. had visa use not been capped.

Slaughter didn't deny that the H-1B visa program can also lead to some job displacement. Last year, some 2.4 million net jobs were created in the U.S., but that net job creation number "masks a tremendous amount of gross job destruction and gross job creation," he said.

Compete America's latest effort won't sway the contentious debate. The visa issue is too emotional, too intense and too real for many people in IT.

Underlying H-1B use are the experiences of U.S. workers, particularly those at risk of job loss because of offshoring or age.

One IT worker, who spoke to Computerworld on the condition that a name and company not be used because of possible retribution, outlined problems with the H-1B visa.

The worker is employed at a company that contracted with Indian IT services providers, which are among the largest H-1B visa users, to take over a significant part of the company's IT operations.

"The biggest slap in the face to all of us here is we have to train all of our replacements," said the IT worker. Once that training is completed, the IT workers receive severance pay. Some employees were offered jobs with the offshore companies, but at lower salaries and with reduced benefits, he said.

"We're all being marched out the door, so how does [Compete America's effort] save American jobs?" the worker said.

When Computerworld recounted the worker's comments to Slaughter, he responded by saying that job creation and destruction "is a permanent feature of how economic growth happens" even during strong economic times.

"I don't deny that those job separations happen throughout the U.S. economy, in every industry, every hour, but it's important to keep that in context of trying to get policies in place to increase net job creation in America," said Slaughter.

Scott Corley, executive director of Compete America, said an anecdotal case of a displaced worker could be countered by instances of companies "that have created a lot of jobs, but aren't able to right now because they can't get the workers they need."

The H-1B debate cuts across many issues, such as wage pressure and age discrimination.



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