Many H-1B workers get temporary jobs, study finds

Offshore firms seek permanent residency for few H-1Bs; U.S. firms have mixed plans

Many employers sponsor H-1B holders to have them fill temporary posts, not to become full-time residents of the U.S., according to a study released last week by the Economic Policy Institute, a Washington-based nonprofit think tank.

The differences in the ways companies use H-1B visas can be stark, according to the study, which was authored by Ron Hira, an associate professor of public policy at the Rochester Institute of Technology and a longtime critic of the H-1B visa program. (Download a PDF of study here.)

For example, large India-based companies mostly seek permanent residency for just a small percentage of the U.S.-based employees for whom they try to secure H-1B visas, while some U.S.-based companies, such as Microsoft Corp. and Qualcomm Inc., are more likely to begin the green card process for employees. "Rather than attracting the 'best and brightest' for permanent immigration, as many have claimed, the programs have increasingly been used for temporary labor mobility to transfer work overseas and to take advantage of cheaper guest-worker labor," wrote Hira.

The study was called misleading by a spokesman for Compete America, a coalition of vendors, universities and other sponsors of H-1B visa holders. Spokesman Eric Thomas in particular questioned the use of L-1 visa data in the study. The L-1 visa is used by multinational companies for intracompany transfers. "That's how the system was designed, and that's how it's working. Lumping different visa categories into one bucket is a clear attempt to skew the data," he said.

The study examines company-by-company data and then separates it into H-1B and L-1 visa categories. An examination of the study finds that even if L-1 visa data is excluded, the pattern of visa use appears to remain the same.

For instance, Infosys Technologies Ltd., a Bangalore, India-based IT consulting and services firm with offices around the world, was the top H-1B user in 2008 with 4,559 approved visas, but in the same year, the company applied for permanent residency for 237 workers.

The report benchmarks visa data with what it terms an "immigration yield," or the ratio of permanent residency applications filed to H-1B petitions. In the case of Infosys, that ratio is 5%. The pattern of low percentages is similar in L-1 visa usage.

Because H-1B workers can work in the U.S. for six years, the applications for permanent residency can take place in any of those years.

An exception among the large offshore vendors in seeking permanent residency for employees is Cognizant Technology Solutions Corp., a Teaneck, N.J.-based company with major overseas operations.

In 2008 Cognizant was approved for 467 H-1B visas and sought permanent residency for 332 people that year, for a ratio of 71%. Cognizant received 1,839 L-1 visas, the second largest number in 2008 after Mumbai, India-based Tata Consultancy Services Ltd., which received 1,998 L-1 visas.

Cognizant applied for permanent residency for 342 of its L-1 workers. Tata didn't apply for permanent residency for any of its L-1 workers or H-1B workers in 2008.

Among the top IT vendors, Hira's study found that Microsoft was granted 1,037 H-1B visas in 2008 and had sought permanent residency for 703 H-1B holders that year, for an "immigration yield" of 68%. Intel Corp. received 351 H-1B visas that year but applied for permanent residency for only two visa holders. A year earlier, though, Intel's permanent residence applications amounted to 42% of the 369 H-1B visas it received.

Meanwhile, Google Inc. received approval for 207 H-1B visas in 2008 and sought permanent residency for 108 visa holders. And Goldman Sachs & Co. was granted 211 H-1B visas in 2008 and sought permanent residency for 13 employees.

Researchers can only estimate the numbers of H-1B and L-1 workers in the U.S. at any one time because of a lack of pertinent government data on visa usage. Thus it is difficult to determine the overall percentage of H-1B workers who actually receive permanent residency.

In the Economic Policy Institute study, H-1Bs accounted for 63% of the permanent residence applications in 2008, or 30,951 of 49,205. However, Hira noted that those in the latest permanent residency database could have gained H-1B employment at any time between 2002 and 2008, making pool of H-1Bs eligible for the permanent residency approval process much higher than the number of H-1B visas approved in 2008.

Various estimates put the overall number of visa holders in the range of 600,000 H-1B workers and 350,000 L-1 workers, according to Hira's new study.

A decade-old study by Georgetown University estimated that about 50% of H-1B visa holders become permanent residents of the United States. Hira believes the percentage has fallen, based on the numbers in his analysis.

Hira argues that visa rules put most of the power to control H-1B workers in the hands of employers. Visa workers can "switch jobs in very limited circumstances, and their employer can revoke the visa at any time by terminating their employment, forcing the worker out of status with immigration authorities. If employment is terminated, the worker must leave the country immediately," the study said.

Eleanor Pelta, first vice president of the American Immigration Lawyers Association, was critical of Hira's assessment of the role that H-1B workers play in the workforce and noted that visa proponents are hoping that Congress reforms the current rules. Such reforms, expected in a comprehensive immigration bill, could make it easier for highly skilled workers to get permanent residency.

Citing the multiyear backlog in green card applications, Pelta said that she doesn't believe visa holders should come to the US "and then wait 10 to 15 years for a green card; I think that is really bad for the economy."

Patrick Thibodeau covers SaaS and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at @DCgov, send e-mail to or subscribe to Patrick's RSS feed .

Copyright © 2010 IDG Communications, Inc.

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