Study: Number of High-Skilled Immigration Visas Quadruples Legal Cap

'H-1B dependent' firms hire less-educated immigrants, pay them less on average

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March 28, 2018

More than 345,000 visa petitions for high-skilled employment immigration were awarded in 2016 under the H-1B program, over four times the legal cap of 85,000, a new report from the Migration Policy Institute (MPI) has found.

Additionally, among the top 20 H-1B requesting firms, those which were "H-1B dependent" (i.e., more than 15 percent of employees were H-1B recipients) paid their immigrant employees less on average and employed fewer immigrants with at least master's degrees, lending credence to accusations that some firms were using the program to crowd out U.S. citizens.

The H-1B program issues visas to certain high-skilled workers, primarily those with at least bachelor's degrees in fields that require complex, specific skills, like engineering or computer science. According to MPI's analysis of newly released data from U.S. Citizenship and Immigration Services, the majority of those petitioning for an H-1B visa are from India, with additional large numbers of applicants from China.

Officially, H-1Bs are capped at 85,000 per year, a number that Congress most recently increased in 2004 by adding an additional 20,000 visas for holders of master's degrees. However, that cap is regularly exceeded, according to the study, with an average of 212,000 over the past five years.

The reason for this is twofold. Certain employers—universities and nonprofit or government research organizations primarily—are uncapped in the number of visas their employers can receive. Additionally, preexisting H-1B holders who are renewing their visa or are changing employers are exempt from the statutory cap.

The latter group, which MPI names as responsible for the growth of the H-1B program overall, are in some cases able to remain in the country after their visa has expired if they are in the process of applying for renewal. Thanks in large part to those seeking renewals, H-1B petitions have risen by 60 percent since FY 2010.

The program has attracted scrutiny from President Donald Trump, who promised during his campaign to crack down on any abuse or misuse of the program. In April of 2017, he put that promise into practice with an executive order calling on USCIS to review the program as part of a broader push to "buy American and hire American." In response, the administration is expected to at least end an Obama-era initiative that gave work authorizations to the spouses of H-1B recipients. USCIS does not expect to end H-1B extensions, at least as of January of this year.

The H-1B visa program has faced criticism in part because, detractors say, it crowds out Americans with high-skilled but lower-paid immigrants. Sen. Tom Cotton (R., Ark.) has attacked the program, arguing that employers "don't bring in Ph.D.s and computer scientists. They bring in mid-level and they replace mid-level data management workers."

In spite of legal rules meant to limit such behavior, "scattered reports of companies using the H-1B visa to replace U.S. workers continue," the MPI report found. "In recent years, companies such as Southern California Edison, New York Life, Walt Disney Company, and Toys 'R' Us have received widespread attention and criticism for hiring H-1B dependent outsourcing companies, announcing layoffs of U.S. workers, and requiring those losing their jobs to train their H-1B replacements in order to receive severance payments."

MPI found data suggestive of this issue in reviewing the employment behaviors of the top twenty H-1B recipient employers, who collectively made up 32 percent of approved petitions in FY 2017. Firms that qualified as H-1B dependent paid their immigrant employees $30,000 less on average than their non-dependent counterparts. They also employed fewer workers with master's degrees or greater—27 percent those working for H-1B dependent employers had a master's or higher degree, compared to 55 percent for those working for non-H-1B dependent employers.

"Data on employers making heavy use of the program suggest that some employers are not using the H-1B visa to hire the best and brightest workers, and may instead be filling mid-level technology jobs," MPI concludes.

Published under: Immigration , Outsourcing