Emotions Run Hot on H-1Bs

Numbers difficult to track; impact of visas debated

It would be easier to separate sheets of wet tissue paper pounded flat by a hammer than to separate fact from fiction in the H-1B debate.

Employers say foreign workers fill gaps left by a dearth of qualified U.S. residents.

Unemployed IT workers and their allies say there's no labor shortage. They claim that employers are just trying to cut IT costs and drive down wages by hiring foreign workers at lower pay rates.

The truth lies somewhere in between, but clarifying the issue is difficult because emotions run high and statistics are either contradictory or dated. For example, the Immigration and Naturalization Service (INS) stopped tracing H-1B data after the Sept. 11 attacks. Other oft-cited numbers were issued in 1998 or early 2000.

Still, the available data does bear out that H-1B workers are often younger and better educated than their American peers and are seeking permanent resident status. Most H-1B holders in the computer industry are hired to fill systems analyst and programming jobs. Some receive the prevailing wage, while others make less working in job shops. But the numbers are meaningless to many.

"The problem with the whole issue is that it gets into matters of immigration," said Robert D. Austin, assistant professor of IT management at Harvard Business School. "And that turns into us vs. them."

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U.S. Labor Dept. Rules for H-1B Visa holders

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A company must compare the prevailing wage for a position to the actual wage it pays other workers in similar positions. It must then pay the H-1B holder the higher of the two.

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A company must post notice of its intent to hire H-1B visa holders and inform other employees and anyone who negotiates salaries for them. If there is no one who negotiates for all employees, then the company must post two notices in places visible to all workers for at least 10 days.

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Companies that violate these rules are subject to fines.

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So it's not surprising that the debate often drifts into rhetorical battles, giving rise to such unsubstantiated extremes as the charge that all the H-1B workers in a New Jersey office cheered as across the Hudson River the World Trade Center towers fell.

The following are some of the arguments on each side:

• Companies have created an indentured servant class out of H-1B visa holders, according to Norman Matloff, a professor at the University of California, Davis.

• Companies don't hire average IT workers, but rather engineers with advanced degrees, said Paula Collins, director of government relations for human resources and education at Texas Instruments Inc.

• Companies would rather hire U.S. residents because it costs $1,000 in fees to hire an H-1B holder, said Margaret Wong, an immigration lawyer in Cleveland.

According to the last INS report regarding which companies hire the most H-1B workers, covering October 1999 to February 2000, Motorola Inc. (618), Oracle Corp. (455) and Cisco Systems Inc. (398) topped the list. Others in the top 25 included Intel Corp., Microsoft Corp. and Sun Microsystems Inc. Most of those companies wouldn't comment.

Cisco said that the INS numbers are out of date, noting that it has backed off its H-1B program and has actually done little hiring of any kind recently. Layoffs caused by the downturn have increased the number of qualified U.S. workers in the marketplace, Cisco said.

"Basically, we have been a user of the program almost exclusively to hire electrical engineers, all of whom or most of whom have master's degrees or Ph.D.s," said a Texas Instruments spokesman. Statistics do show that more foreign nationals receive advanced degrees in engineering, computer engineering and computer science.

In the 2000-01 academic year, foreign nationals took 60.4% of computer engineering master's degrees. They earned 68.9% of computer science and 51.8% of combined computer science and engineering master's, according to Richard Heckel, technical director at Houghton, Mich.-based Engineering Trends Inc. His firm tracks graduate information from U.S. engineering colleges. As for Ph.D.s, foreigners took 66.1% in computer engineering degrees, 54% in computer science and 54.3 % in combined computer science/engineering.

But that matters only if you believe the companies; Matloff, a vigorous critic of H-1B visas, says he doesn't. His research shows that only 1% of H-1B holders have Ph.D.s and only 7.5% have master's degrees.

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Copyright © 2002 IDG Communications, Inc.

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