What will an H-1B cap hike bring to U.S.?

Leading critic warns of 'internal (U.S.) brain drain' as foreign competition rises for American tech jobs

WASHINGTON -- Ten U.S. senators this week agreed to sponsor a bill that would allow the annual H-1B visa cap to rise to as high as 300,000, leaving opponents and some researchers concerned.

Under the proposal, the cap would begin at 115,000 and rise as H-1B demand increases or fall when it slackens. Critics say the plan would escalate problems already faced by U.S. workers.

Adding more entry-level and young H-1B workers may boost offshoring and put pressure on wages, increase age discrimination and discourage U.S. students from entering the IT business, say opponents.

The Senate proponents say the H-1B visas are needed to fill critical jobs and keep the U.S. competitive. The visas give companies the ability to hire who they want.

Some lawmakers, though, want to lessen the emphasis on temporary workers and instead focus on encouraging foreign graduates of U.S. universities to remain in the country. These officials would offer permanent residency to foreign students that earn an advanced degree in science, technology, engineering and math, or the so-called STEM degrees.

President Barack Obama supports a STEM visa, but his administration has not yet said whether it would support a plan to increase the H-1B cap.

Many in the IT industry have long argued that U.S. schools aren't producing experts with the tech skills they needs.

The shape of the debate was defined 1998 when Norman Matloff, a computer science professor at the University of California at Davis, challenged the industry at a hearing before a U.S. House committee, where he spoke on "Debunking the Myth of a Desperate Software Labor Shortage."

The debate around the H-1B visa follows multiple paths.

Microsoft, which may be the most outspoken industry advocate for H-1Bs, says this visa is particularly important for its hiring needs. The company refutes critics who say the guest worker program lowers wages for tech workers.

Microsoft says the typical pay for a new programmer or software engineer ranges from $100,000 to $120,000. "A person with an H-1B visa is not be treated differently than any other new hire," a spokeswoman said.

But that's Microsoft.

At a 2011 House hearing on H-1B visa issues, U.S. Rep. Zoe Lofgren (D-Calif.) said she had asked the Labor Dept. for a report the average wage for computer system analysts in her district. The result: $92,000 overall for entry level workers, but department also reported that the entry level rate prevailing wage rate for an H-1B worker was $52,000.

"We can't have people coming in and undercutting the American educated workforce -- that is just a problem," Lofgren said.

The U.S. Government Accountability Office (GAO) examined the Labor Dept. data and found that a majority of H-1B workers were hired at entry level.

In a year-long period ending midway through 2010, The GAO reported that 54% of the H-1B labor applications "were categorized as entry-level positions and were paid at the lowest pay grades allowed under the prevailing wage levels."

In response to the I2 bill, the Programmers Guild said all H-1B workers must be paid a salary of $100,000. "This deters employers from misusing" the H-1B visa "as a source of cheap, low-skilled, labor at the exclusion of new graduates."

Companies with the most critical need for H-1B visas are in India or companies that rely heavily on its labor force. Indian offshore outsourcing firms emerge year after year as the top H-1B users.

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