Congress needs to reform H-1B visa program, watchdog says

GAO: Worker protections under H-1B have eroded over the years

Congress should reform the H-1B visa program for skilled foreign workers because it might not be performing effectively and might not be protecting American workers adequately, according to a new report from the Government Accountability Office.

The 118-page report offers a number of findings and recommendations about the controversial H-1B visa program that allows U.S. employers to hire tens of thousands of skilled foreign workers on a temporary basis each year. Many federal contractors support the program because they believe it helps U.S. competitiveness.


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Congress created the H-1B visa program in 1990 to enable U.S. employers to hire temporary, foreign workers in specialty occupations. Initially, the number of visas was capped at 65,000 per year, but the cap has fluctuated with various legislative provisions, and in most years, demand has exceeded the cap. In 2009, approximately 85,000 H-1B visas were approved.

According to the GAO report, fewer than 1 percent of employers garnered more than 25 percent of all H-1B approvals. Most of the workers from 2000 to 2009 came from India, China, Canada and the Philippines.

Although Congress initially included protections for American workers to ensure that U.S. wages would not be adversely affected by the hiring of too many temporary foreign workers, over time the protections have been weakened by various legislative changes, fragmented and limited agency oversight, and data limitations that prevent better targeting of the caps, the report states.

The report indicates that in several wage categories, the median wages paid to H-1B workers are lower than those paid to American workers in the same job category.

For example, for systems analysis, programming and computer-related occupations, the H-1B workers reported an average wage of $61,000 annually, while the U.S. workers reported an average wage of $70,000 annually, which was considered a statistically significant difference. Those findings applied to workers ages 18 to 50. The trend was most notable for older IT workers, ages 40 to 50.

GAO said it could not fully analyze the meaning of the wage differences because it needed additional information and analysis of all factors affecting wages.

Overall, the watchdog agency concluded that the H-1B program is ripe for reform.

“Taken together, the multifaceted challenges identified in this report show that the H-1B program, as currently structured, may not be used to its full potential and may be detrimental in some cases,” the GAO report states.

GAO recommended that the Labor Department, which assists in enforcing the H-1B visas, develop and maintain a centralized public Web site where businesses must post notices of their intent to hire H-1B workers.

The notices should specify the job category and work site location noted on the Labor Condition Application and required by statute on current noncentralized postings.

The report made several other recommendations, including advising Congress that it ought to conduct a review of the H-1B program to examine exemptions from the cap, the role of staffing companies, the level of the cap and how the system relates to immigration, among other issues.

GAO said it sought comment from all the agencies affected, including the Homeland Security, Justice, Labor and State departments. Justice supported several of the recommendations, while DHS disagreed with two of them. Labor and State did not respond.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

Reader Comments

Mon, Jul 11, 2011

What about 401K for foreign workers? I know people who are planning their 401K to take back to India. Regardless if the employee is foreign, 401K is matched with Corporate America money and receives Uncle Sam’s tax benefits. The majority of foreign workers intend to retire in their home country. If they move back to their home country at an age where they don't have to pay the tax penalty, the foreign worker will end up scamming Uncle Sam, in addition to the American worker and the American economy.
What about Social Security Benefits for foreign workers? I know people whose parents live in the Philippines and get SSN checks sent to them.

Fri, Apr 29, 2011 ken

People are in favor of Durbin/Grassley bill 887. Who would be against reducing fraud and abuse other than employers and pimps that depend on fraud and abuse? It is unpatriotic and morally wrong to hire a foreigner over us citizen at any cost. As we can't replace our politician with best and bright politician from other country so should not we replace our workers It is not wise for USA to put itsall eggs in India's basket. We have top universities in the world and best talent.

Fri, Mar 11, 2011 C OH and VA

The entire h1b program is abusive to white collar American workers as illegal immigration is to blue collar Americans. Both parties should understand that the vocal few might complain, but Americans of both parties will CELEBRATE them and vote for them if they kill the H1B program and illegal immigration. When unemployment in the US is back to 3-4% THEN MAYBE we can consider allowing a few H1B's. Examples here and now - pseudo-govt agency claiming they need to bring the jobs back from India (3 positions). H1B non-manager interviews American woman (25 years experience - actually over qualified, traveling from another state where there is no work) he rejects her. Luckily for her the guy goes back to India for a month and the mgr asks the other interviewer what HE thought. She gets hired. Then they set out to hire the other 2 jobs. My colleague has nearly 30 yrs experience and is over qualified but out of work for over 3 years since he's from a 1 shop town that has sent the jobs to India, so he's willing to travel/relocate. This guy is not as lucky, the only interviewer is the same H1b guy who rejected gal 1. He rejects American guy - on top of that when asked about the candidates, refers to having 1 and a HALF candidates. (He was referring to the American as a HALF PERSON.) This agency hires TWO H1B's - each with 1.5 years experience. The thing is that they may have been cheaper for the contract co. BUT the BILL RATE WAS THE SAME. Way to bring those jobs back to America?? Bring the H1B's to do them. Suicidal for the country!

Thu, Feb 10, 2011 Ryan silicon valley

Last week I went to a meeting of biodevice engineers. During the social part of the evening, one hiring manager told me in a confidential tone that his company is hiring lots of workers, they just are hiring them all from India. In effect, he said, they are not even looking in America, although of course they have to advertise here to pretend they are. Meanwhile, I know many unemployed American engineers with cutting edge skills, willing to work any hours an employer asks. They are being told by company recruiters that there are no suitable positions for them, while companies hire foreign nationals in the thousands and tell Congress there is a shortage of American engineers. This system is being badly abused. It was meant to provide very specialized skill sets in hard-to-fill areas, and instead is being used to replace American workers wholesale. And the reason is not that Indian or Chinese engineers are so much more skilled than Americans, it is that the corporation can hire them on the cheap and then, b/c they hold the green card, exercise huge control over them. These are the only real reaasons corporations want these thousands of H 1-B visas. This is an abusive system which desperately needs reform.

Wed, Jan 19, 2011 R. Lawson -1

I find it interesting that departments simply refuse to respond to GAO inquiries. Do they not want to contribute to solutions? I would like the GAO given more clout and taken more seriously by Congress. They have a record of producing smart studies, while at the same time being totally ignored by politicians.

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