Some sense from Chase Norlin on H-1B visas at RealClearPolitics:
In a letter dated November 14, a lobbying group whose members included Twitter, Netflix, Facebook, and Google urged President-elect Donald Trump to increase the number. “The U.S. immigration system must allow more high-skilled graduates and workers to stay in the United States and contribute to our economy,†wrote Michael Beckerman, president of the Internet Association. Last week, tech big shots like Apple CEO Tim Cook, Alphabet CEO Larry Page and Microsoft CEO Satya Nadella met with Trump in New York. You can bet the pitch was similar.
Their economic argument, that the industry suffers from a shortage of workers, is false and misleading. Big tech companies take advantage of the H1B program to drive their bottom line. The law permits companies to lay off their own employees in favor of foreign workers doing the work in the states or overseas. Think about that. The law does more than look the other way at firms that hire foreign workers instead of American citizens; it allows companies to ditch their own employees so they can hire foreign nationals. Remember the recent story about laid-off Disney workers who were forced to train their foreign replacements?
Not surprisingly, tech firms use the provision to their advantage. In late 2014, Microsoft laid off 21,000 workers. In September 2015, Hewlett Packard announced it was cutting 25,000 to 30,000 workers. That was on top of the 55,000 jobs it slashed the year before.
Another problem with the H1B program is the law rewards companies for outsourcing their training programs. About half, or 40,000 of the visas handed out each year, don’t go to firms such as Microsoft, Apple or Facebook, the companies we think about when we hear H1B. They go to professional offshore outsourcing firms such as Cognizant, which received 9,000 H1B’s last year.
The evidence that large tech firms actually need to bring workers in from overseas is extremely slim. There are any number of ways to reform the present system including my suggestion of a central clearing house for job offers accompanied by increased penalties for offering jobs at below the prevailing wage (notionally a requirement for bringing in a workers on an H-1B).
An outright ban on replacing present workers with imported workers doesn’t sound out of line, either.
so why do you oppose labor unions if you support Govt. doing the same thing?
When we sponsored 2 men for citizenship we had to go through a long laborious interview process. It entailed advertising the jobs we were filling, defining the skill sets we were looking for as well as the pay scale. Personal interviews of those who responded followed, along with written documentation of that interview. This was all done in order to “not take jobs away from any American.”. One of the men we agreed to sponsor finally got his papers. The other did not.
Gray Shambler:
Why do you think I oppose labor unions? I don’t. I don’t think that union leaders are serving their membership well. That’s something different.
I’ve played this game for 40 years and I know how it’s done. “Advertising” sometimes consists of posting a notice of the job on the bulletin board in your Boise, Idaho plant or a “Help Wanted” ad in the Anchorage Daily News for a job in Raleigh, North Carolina.
I don’t know one way or the other about HP, but Microsoft’s 2014 layoffs had nothing to do with H1B visas. The layoffs were the result of shutting down parts of the business that the new CEO had decided to abandon, mostly from the 2013 Nokia acquisition.
At my time at Microsoft, a lot of my coworkers have been immigrants, but most of them have been naturalized citizens or permanent residents. They get paid on the same payscale as America-born employees, and I haven’t noticed any evidence of discrimination in promotions and performance reviews.
The outsourcing firms are a thing. But my observation of how they’re used is that big tech companies prefer to have programming/engineering roles filled by full-time employees, and non-engineering technical jobs (lab technicians, sysadmins, manual test runners, etc) run by contractors. The contractors come through agencies (for legal and administrative reasons: the agency handles payroll, benefits, etc, and it insulates the tech company from claims under labor law that the contractor should receive the benefits of being a full-time employee (since the contractor is technically a full-time employee of the agency, which does work under contract with Microsoft, etc)), and the agencies often make extensive use of H1B visas. For full-time employees, Microsoft hires both immigrants and native workers on pretty much equal terms. The most common pattern I’ve seen for non-citizen immigrant FTE hires has been for somebody who’s already here on a student visa or a work visa to go through the same recruitment/interview process as an American recruitment candidate, then after the hire decision is made and the offer is accepted, Microsoft reviews the new hire’s work status and figures out how to get them a visa. H1Bs are used, but I think TN and L1 visas are at least as common. Once the employee is hired, they’ll almost always apply for and eventually get a permanent residency visa.
Dave, maybe that was your experience. It does not represent our’s. We had a far reaching exposure including the LAT and unemployment offices in the greater Los Angeles area. It was an exhausting process.
Companies like Apple, Amazon, Facebook, Google and Microsoft actually are having trouble identifying and hiring enough Americans to fill all the software jobs. I’ve worked at several of them, and have seen this first hand — I’ve interviewed well over a hundred candidates. And, as a country, we want those people with high earning potentials, here, paying taxes and becoming citizens (which is actually a goal of most of the foreign workers we hired).
It’s hard to navigate the system and get good people into the country. And we can’t just retrain coal miners for these jobs.
There are abuses even at that level, and the system could use some reform — employees find their ability to stay in the country tied to their employment, so they cannot negotiate for better pay or more reasonable hours. And there are the little white lies: If a company has three open positions with similar requirements, and they have a foreign candidate they want to hire, they change the requirements to make one of the jobs more tailored for that candidate (ability to speak Esperanto? Sure, why not!).
And, then there are the consulting companies and the offshoring houses, which do us no good.
The system needs reform. The lottery is ridiculous, and doesn’t help us meet our country’s needs (unless we don’t want qualified foreigners, we want lucky foreigners!).
I would want to see the workers have more portability with their visas, and the visas to be given out to the highest paying jobs — make it more expensive to hire a foreign worker, so American jobs are not affected, but make it easier to do so when the company has to.
I basically agree with that assessment. However, I remain skeptical that Amazon, Google, etc. can’t get the workers they want in the United States. What I think is true is that they can’t get the workers they want at the price they want to pay. If it were otherwise we’d see wages rising faster than they are.
The Amazons, Googles, etc. are all competing for the same set of software engineers, and wages are rising there as that group is pretty tapped out. Amazon has a lower hiring bar than Google, but roughly the same as Microsoft.
People switch jobs every two to three years to get a pay bump (which seems like the companies are screwing up not giving raises to keep employees).
I would love if one of them decided to pay twice as much, as I would be interviewing there — I can work on a boring project for twice as much money. However, lets not assume these people are underpaid — a mid level engineer should be making close to 200k in total compensation. H1Bs make less, because they cannot negotiate. The current system creates incentives to hire H1B workers.
Adding more personal Plex to the field would depress salaries. I would happily trade a 10% reduction in salary for a a fully staffed project where I am on all less often. Or a 25% reduction for three months off.
That’s what the author of the linked article says, too, and he thinks they’re making a mistake.
Training people costs money, and if most people switch jobs every three years, a company doesn’t want to invest in the employees that much. It’s the same economic barriers that make health insurance companies not want to pay for preventive care.
Also, the number of people who can be trained to be in the top 80-90% of software engineers (which is the pool those companies are competing for) is surprisingly low. There’s a mindset that is very difficult to instill in people that allows them to take a large problem, and break it into more tractable problems while being aware of the thousands of moving parts and the interactions — I’m not sure that mindset can be taught, or whether it can only be encouraged in those who have it. Most people are either paralyzed by the amount of information, or cannot adjust when they inevitably discover that some of the unimportant details were very important.
Those who can do it well are basically the people who hear of Rumsfeld’s “known unknowns and unknown unknowns” and scoff because he hasn’t broken out the knowns and the degrees of confidence for them.
Now, whether Google needs someone in the top 80-90% to move a button on a webpage… that’s another question. There’s a belief at those companies that most people should be generalists or interchangeable cogs.
Note, I have benefited from the current system.
I think everyone has good points.
Here’s a an anecdote. Oracle opened an office in Seattle to do a crash effort to get into cloud computing. To get the talent they required, they paid 2x to 3x the market rate for engineers. Needless to say, Oracle had no problems filling positions without hiring from outside the country (note I do not work for Oracle). Would big tech have enough workers if it was very hard to hire foreign talent – probably not at current saleries, at 2x or 3x, much closer call as it would attract a lot of people who otherwise go to fields like finance. But would 2x or 3x big tech engineer salaries be a good thing, it might make income inequality worse.
Thinking big tech companies solely use foreign workers to lower wages is absurd, for all the reasons pointed above – but to dismiss that as a motivation is also absurd. Apple, Google and a bunch of others were caught colluding on hiring to keep people from jumping and getting pay raises.
As usual, CuriousOnlooker, you’ve summarized my thinking masterfully:
I emphasize the collusion because, if you depend only on what Mark Zuckerberg and Bill Gates say, their practices are solely because they can’t find any workers here.