Tag Archives: Green Card

Immigration Blog

Why (and What) Are Indians Studying In The United States?

Leave a comment

Indian students are a key source of future immigrants to the United States. Many of these students are recruited off U.S. campuses to work in America and are sponsored for permanent residence (a green card). But why do Indian students come here? And what are they studying?

A primary reason anyone desires to study abroad is the belief that education in another country will offer a unique benefit or perspective, or be important for a future career. When U.S. students go abroad it’s more likely to be for a semester or a year, rather than for a full degree program. However, a chance to earn a degree from a prestigious university, such as the London School of Economics, is valued. But in many cases, Americans are seeking unique cultural opportunities when studying abroad, particularly the chance to master another language.

In the case of Indians, there is great interest in gaining a degree abroad that will advance career goals. The majority of Indians come here to earn a masters or Ph.D. In the 2009/2010 academic year, 65 percent of Indian students in the United States were enrolled in a graduate program, compared to 14.5 percent in undergraduate programs (and 18.7 percent in Optional Practical Training), according to the Institute of International Education. That is much different than for countries as a whole, where the number of students seeking a bachelor’s degree and graduate degree is about even for international students coming to the United States.

There appears to be a strong sense among Indians coming here that an American university education is most valuable in engineering, computer science or business. As Table 1 shows, in the 2009/2010 academic year nearly 40 percent of Indian students in America were enrolled in engineering programs at U.S. colleges, according to the Institute of International Education; approximately 20 percent were in math/computer science and 15 percent in business/management. While 10 percent were in physical/life science, only 5 percent were enrolled in health professions, 3 percent in social sciences and 0.6 percent in humanities. Indians are not coming to America in great numbers to earn a degree in history or sociology.

Table 1

                                                    Indian Students By Field of Study in U.S.: 2009/2010

Business/Management Engineering Physical/Life Sciences Math/Computer Science Social Science Health Professions
Percentage of Indian Students in Field 15.3% 38.8 % 10.2% 19.8% 3% 4.9%

           Source: Institute of International Education

How does this study pattern compare to other countries?

India possesses the highest proportion of students enrolled in engineering, followed by Malaysia, Saudi Arabia, Nigeria, Turkey, Pakistan and China. (See Table 2)  India also possesses the highest proportion of students enrolled in math/computer science, followed by Nepal, China, Pakistan and Turkey. It is important to remember that India and China send many more students to the United States than those other countries, which means there is a high concentration of Indians, as well as Chinese, in U.S. graduate programs in both engineering and math/computer science.

For students from many other countries studying in America to earn a degree in business/management is a higher relative priority. While 15 percent of Indian students in 2009/10 enrolled in business/management, 24 percent of students from China did so, as did approximately 25 percent of students from Taiwan, Germany and Pakistan. Nearly 40 percent of students from Vietnam are here to study business/management.

Table 2

                              Percentage of International Students By Country in U.S. Engineering Programs: 2009/2010

Country Percentage Enrolled in Engineering
India 38.8%
Malaysia 28.4%
Saudi Arabia 24.0%
Nigeria 23.6%
Turkey 23.3%
Pakistan 23.2%
China 20.2%

                                                     Source: Institute of International Education

Table 3

                      Percentage of International Students By Country in U.S. Math/Comp. Sci. Programs: 2009/2010

Country Percentage Enrolled in Math/Computer Science
India 19.8%
Nepal 11.7%
China 10.7%
Pakistan 10.7%
Turkey 10.0%

                                                     Source: Institute of International Education

Conclusion

The number of Indian students enrolled at U.S. universities nearly doubled in the last decade and has tripled since 1995. The data show Indians are taking advantage of American universities’ comparative advantage in the fields of engineering, math/computer science and business/management. Examining the fields of study shows Indians have increasingly seen an American degree in these fields as the ticket to success.

Immigration Blog

Addressing the Arguments Against Comprehensive Immigration Reform

4 Comments

Indian-Americans know that for the past several years failure to pass comprehensive immigration reform legislation has blocked other changes to U.S. immigration law. Smaller, more targeted measures to fix problems associated with employment and family immigration, including reducing the large backlogs, have not see light of day to due to the inability to pass large-scale immigration legislation. Important measures on employer-sponsored green cards were part of a 2006 immigration reform bill that passed the Senate but failed to become law after opposition from House Republicans.

What are the main arguments against comprehensive immigration reform? And are there good responses to those arguments? I recently addressed the five main arguments offered against comprehensive immigration reform in a paper for the Cato Institute. (The study can be found here.)

1) Immigration Reform Will Not Harm Taxpayers. The paper notes that legalizing both the flow of workers and those already in the country without legal status will help taxpayers by raising the newly legalized workers’ earnings, productivity, and the likelihood they will pay taxes. Columbia University economist Francisco L. Rivera-Batiz found that illegal immigrants who received legal status under 1986 legislation received “significantly” higher wages once they became legal. (Higher wages equals higher taxes.) Peter Dixon and Maureen Rimmer, both with Monash University in Australia, found compared to more increases in border enforcement, using legal temporary workers to replace the flow of illegal immigrants would benefit U.S. households by $260 billion a year.

2) Newly Legalized workers will not burden the welfare rolls. In general, newly arriving immigrants are not heavy users of welfare and, in fact, are usually not eligible for federal means-tested programs. In 2006, according to the House Ways and Means Committee, only 0.7 percent of noncitizen used TANF (Temporary Assistance for Needy Families). Much use of benefits declined for immigrants after eligibility rules changed in the 1996 welfare reform law, though even before the changes immigrant welfare use tended to be overstated. It’s true U.S.-born children of immigrants may receive more benefits than their immigrant parents. However, the comparisons of who is a net taxpayer can be misleading if one counts native-born children of immigrants as (immigration) costs when they are young but then fails to count them as tax contributors once they reach adulthood.

3) Another amnesty need not beget more amnesties. If Congress legalizes the status of individuals here unlawfully it does not need to be an amnesty, which usually requires little or no action on the part of the recipient. Instead, Congress can impose a series of conditions for that forgiveness, including fines and future obligations.

4) Legalizing or admitting less-skilled workers will not undermine U.S. culture or the English language. Immigrants and their children are learning English. A total of 91 percent of second-generation Hispanic immigrants (the children of immigrants) said they speak English “well” or “pretty well,” which rises to 97 percent by the third generation.

5) Allowing in more temporary visa holders or legalizing existing workers without legal status will not increase the unemployment rate. Immigrants help make Americans more productive, while having no impact on the unemployment rate. As economists like Mark J. Perry, a professor at the University of Michigan, Flint campus, point out, there is no fixed number of jobs, so there is no way for immigrants to “take away jobs from Americans.” There is no evidence unemployment rates rise over time at either the state or national level simply because additional people enter the labor force, whether immigrants or recent graduates from U.S. schools or colleges.

Conclusion

These are not popular arguments to make in a climate when economic recovery remains incomplete in America. And the strongest opponents of immigration reform will not likely be persuaded. However, those who support a better solution than the status quo will need to continue the debate and responding to critics. Otherwise, other problems, such as the need to add more green cards for skilled immigrants, may never be addressed in a Washington, D.C. that remains divided on immigration issues.

Immigration Blog

What’s Happening with H-1B Visas?

Leave a comment

Press outlets are abuzz with stories signaling that H-1B visa numbers are down and, therefore, no longer held in favor by employers. Is that the case?

The key article, which has led to other press articles, was a May 6 Wall Street Journal piece entitled “Long-Prized Tech Visas for U.S. Entry Lose Cachet.” The story began, “A visa program designed to supply skilled foreign workers to companies in the U.S. has slowed sharply, attracting about 50% fewer petitions so far this year than last year, and 80% fewer than in 2009.” The article cites three possible factors: a mediocre U.S. economic recovery, increased opportunities for workers to stay or return to their home countries and higher visa fees against primarily Indian companies.

Because of the great demand for H-1B visas, in recent years, U.S. Citizenship and Immigration Services (USCIS) has accepted H-1B applications for the next fiscal year on April 1, 6 months before new workers would be allowed to start work. That means current petitions filed by employers are for new H-1B visa holders to start work on October 1, 2011, which is the start of fiscal year 2012. (Fiscal year 2012 runs from October 1, 2011 to September 30, 2012.)

The argument that a major slowdown in hiring H-1Bs is taking place rests on the observation that in April 2010 over 16,000 petitions were filed and in April 2009 employers filed 45,000, according to USCIS. Moreover, back in 2008, employers filed enough petitions early on that the quota was reached in the first week filing petitions was permitted. Therefore, when compared to those earlier years, current numbers are down.

A Short History of the H-1B Quota

Congress did not “create” an H-1B visa program in 1990. Individuals had long been permitted to come into the United States on H-1 temporary visas to work in high skill jobs. Prior to 1990, going back to the 1950s, H-1s generally could not enter the United States if they intended to stay permanently.

Congress changed the law in 1990 to allow (explicitly) “dual intent,” which allowed H-1B visa holders to intend to become permanent residents (green card recipients), while also placing an annual limit of 65,000. Much of the debate over H-1Bs has centered on this annual cap.

By 1997, the 65,000 annual limit established by Congress in 1990 proved to be insufficient. Since 1997, employers have exhausted the supply of H-1B visas every year except during FY 2001 to FY 2003, when the ceiling was increased. In the past 9 years employers used up all the visas before or during the fiscal year. In 1998 and 2000 Congress passed short-term H-1B numerical increases that eventually expired.

In late 2004 Congress approved an exemption of 20,000 from the cap for recipients of an advanced degree from a U.S. university. In earlier legislation, Congress had approved an exemption from the numerical limit for those hired by universities and non-profit or government research institutes. With time Congress has revised the law it has come with greater regulation and, beginning in 1998, higher fees for hiring H-1B professionals.

image1

Market Forces: Why the H-1B Quota is Still Likely to be Fully Utilized

 
If history is a guide, then it is likely the H-1B quota for FY 2012 will be exhausted before the end of the fiscal year. If we examine previous years it is easy to see how labor market conditions have determined the number of H-1B visas used in a year. As noted earlier, for FY 2002 and 2003, Congress temporarily increased the H-1B limit to 195,000. But as Table 1 shows, during those years employers used fewer than 80,000 visas that counted against the cap. That meant about 230,000 H-1B visas went unused in those two years.

In other words, companies did not decide to hire more individuals on H-1B visas during those years simply because the visas were available. And the same is happening today. Employers are analyzing how many people are needed in the United States to accomplish their objectives. In general, smart employers only hire as many people as necessary, since laying off people is costly, inefficient and bad for morale.

What does this mean for H-1B visas? It means that we are still early in the hiring cycle for the 2012 fiscal year, which does not start until October 1, several months from now. Two factors are necessary to keep in mind in projecting H-1B use. First, an H-1B is generally the only practical way to hire a skilled foreign national, including an international student, to work long-term in the United States. Second, the annual quota on H-1B – 65,000 plus the 20,000 exemption for those receiving a masters or higher from a U.S. university – remains low as a proportion of the U.S. labor force, less than one-tenth of one percent.

The fluctuations in H-1B use help demonstrate that employers hire individuals on H-1B visas when it is considered important for the business, not to replace Americans.

 

Table 1

        H-1B VISAS ISSUED AGAINST THE CAP BY YEAR 

Fiscal Year

Annual Limit*

H-1B Visas Unused

1992

65,000

16,400

1993

65,000

3,400

1994

65,000

4,700

1995

65,000

10,800

1996

65,000

9,900

1997

65,000

0

1998

65,000

0

1999

115,000

0

2000

115,000

0

2001

195,000

31,400

2002

195,000

115,900

2003

195,000

117.000

2004

65,000

0

2005

65,000

0

2006

65,000

0

2007

65,000

0

2008

65,000

0

2009

65,000

0

2010

65,000

0

2011

65,000

0
Immigration Blog

Are H-1B Visa Holders Really Only Hired for Cheap Labor? Let’s Look at the Law, Common Sense and Some Data

2 Comments

The argument made by critics of H-1B professionals is straightforward – the only reason companies hire them is because they will work more cheaply. In fact, the argument is central to criticism of H-1Bs and will likely never be conceded by critics, since all assertions about skilled foreign nationals rest on the premise that they work more cheaply.

One can recognize the value of permitting skilled foreign nationals to work in the United States without assuming the entry of every individual results in a storybook ending. America is an immense country with large and small employers and when tens of thousands of new people enter the U.S. labor market for the first time each year it is possible some of these individuals will be taken advantage of or will not recognize their true market value. This may be more likely to occur at some small IT services companies, which have been cited in the press.

However, the law, common sense and available data indicate that, on the whole, H-1B visa holders are paid appropriately based on their age and work experience – even if this does not take place in all circumstances.

Under section 212(n)(1) of the Immigration and Nationality Act, employers must pay H-1B visa holders the higher of the prevailing wage or actual wage paid to “all other individuals with similar experience and qualifications for the specific employment in question.”

To knowingly violate this law risks heavy fines, debarment from using the immigration system for hiring skilled individuals and much bad publicity for the company. That is why one rarely hears of any company with a recognizable name found to have willfully underpaid an individual on an H-1B visa.

Think about what would be necessary for a large or even medium-sized company to (unlawfully) maintain two wage scales – one for foreign nationals, one for U.S. workers. The records would be available and accessible to government auditors on demand – and such audits are frequent these days from U.S. Citizenship and Immigration Services. Moreover, a mid-level employee in the human resources department, perhaps several of them, would have to work with a company’s general counsel office and likely an outside law firm in a conspiracy to underpay foreign nationals. All of this would risk the reputation of the company and the livelihood of the employees involved. And since employers generally pay up to $5,000 to $6,000 in legal and government fees to hire H-1B visa holders, to make this conspiracy worthwhile the amount of underpayment would have to be significant.

After all this is done, can the H-1B professional thwart this conspiracy by simply leaving the employer to work elsewhere? Yes. Do H-1B visa holders change jobs? Yes, it happens quite often, particularly when the economy is good. Immigration attorney and former INS general counsel Bo Cooper recently noted in Congressional testimony that his law firm often processes cases for clients for an H-1B professional to move from one employer to another.

Again, none of this is to deny that some individuals may be shortchanged. It’s more to explore the extent to which one can say that H-1B visa holders in general are underpaid and only hired to save money.

What the Research Shows

In a January 2011 report, the Government Accountability Office (GAO) found H-1B visa holders generally earned the same as U.S. professionals when compared in the same fields and age groups. For example, in the category Systems Analysis, Programming, and Other Computer-Related Occupations, the median salary for an H-1B professional was higher ($60,000 vs. $58,000) than for a U.S. professional in the age group 20-29 and the same ($70,000) in ages 30-39. (See Table 1 below.)

Table 1

Median Reported Salaries of H-1B and U.S. Workers: Systems Analysis, Programming, and Other Computer-Related Occupations

Age Group H-1B U.S. Workers
20-29 $60,000 $58,000
30-39 $70,000 $70,000

Source: H-1B Visa Program: Reforms Are Needed to Minimize the Risks and Costs of Current Program, Government Accountability Office, GAO-11-26, January 2011, Table 1.; Salaries are 2008.

In the age group 20-39 for Electrical/Electronics Engineering Occupations, the median salary for an engineer in H-1B status was higher than for a U.S. engineer – $80,000 vs. $75,000. (See Table 2.) For some reason, U.S. workers in the age 40-50 range earn more in this field than their H-1B counterparts, but since relatively few H-1B visa holders enter the U.S. after the age of 40 (less than 10 percent) and only a portion of those enter this field it is difficult to know whether the data are significant in any way.

Table 2

Median Reported Salaries of H-1B and U.S. Workers: Electrical/Electronics Engineering Occupations


Age Group H-1B U.S. Workers
20-39 $80,000 $75,000

Source: H-1B Visa Program: Reforms Are Needed to Minimize the Risks and Costs of Current Program, Government Accountability Office, GAO-11-26, January 2011, Table 1.; Salaries are 2008.

Table 3 shows in the age group 20-39, H-1B professionals earned $47,237 compared to $35,000 for U.S. professionals for jobs in college and universities.

Table 3

Median Reported Salaries of H-1B and U.S. Workers: Occupations in College and University Education

Age Group H-1B U.S. Workers
20-39 $47,237 $35,000

Source: H-1B Visa Program: Reforms Are Needed to Minimize the Risks and Costs of Current Program, Government Accountability Office, GAO-11-26, January 2011, Table 1.; Salaries are 2008.

What Do These Results Mean?

The data show one needs to compare individuals with similar ages and fields when comparing salaries. Since U.S. professionals tend to be older than H-1B visa holders, U.S. professionals will tend to earn higher salaries. But that doesn’t mean H-1B professionals are only hired because they earn less. Recent U.S.-native-born college graduates earn less money than more experienced native-born professionals in the same field. Does that mean recent native-born college graduates are paid less than more experienced individuals because of wrongdoing by American employers? Of course not. Salaries in America are based on a variety of factors. Individuals with greater experience should be expected to earn higher salaries.

Conclusion

There are reforms that would make the situation better both for workers and legitimate employers. First, strengthen the rules for whistleblowers and make such rules more widely known. Second, increase portability for individuals with pending green card applications so it is easier for a professional to leave a current job if necessary. Third, increase the employment-based green card quota and/or exempt from the quota individuals who received a masters degree or higher from a U.S. university, which would move many people into permanent resident status much more quickly. The green card backlog makes it even more important that Congress refrain from enacting crippling restrictions on H-1B visas, since otherwise it would be difficult for skilled foreign nationals to work in the United States.

The debate over H-1B visas is rarely civil. But hopefully more people will agree that individuals born outside the United States have much more to offer America than, as critics assert, a willingness to work for less money.

Immigration Blog

Little Known Fact: Indians and Others on H-1B Visas Fund Scholarships and Job Training for Americans

6 Comments

One of the more surprising aspects of America’s debate about high skill immigration is how little attention focuses on the fees paid by employers of H-1B visa holders. Indians generally make up roughly half of H-1B professionals, though it varies from year to year, so the fee issue should be of interest to the Indian American community, particularly since it can play a role in the broader immigration policy debate.

Back in 1998, when Congress debated an increase in the H-1B quota, a compromise was reached to raise the 65,000 annual limit for temporary visas for high skilled professionals. The policy debate over increasing the annual H-1B limit centered largely on whether America and U.S. employers were doing enough to train and educate Americans for high skill jobs in the technology field. Under the legislation passed in 1998, Congress raised the H-1B quota for three years, but also assessed a $500 fee on for-profit employers each time they hired (or renewed the status of) an H-1B professional, with the money going towards scholarships and job training.

In 2000, Congress again temporarily boosted the annual quota on H-1B visas and this time raised the training/scholarship fee to $1,000. After both the fee and H-1B quota increase ended in late 2004, Congress raised the H-1B training/scholarship fee to $1,500 ($750 for smaller companies) and provided 20,000 H-1B visas annually (in addition to the 65,000 quota) for individuals who received a masters degree or higher from a U.S. university. Congress also added a $500 anti-fraud fee on each H-1B and L-1 visa.

Lots of Money Raised, But Little Attention

The money raised from this training/scholarship fee has quietly grown over the years. In fact, its growth has been so quiet that nobody seems to have realized how much money has been spent by employers on these fees and where the money has gone.

A recent study from the National Foundation for American Policy concluded:

In addition to paying skilled foreign-born professionals the same wages as comparable American workers, government data show U.S. employers have been required to pay over $3 billion in mandatory government fees since 2000. The data call into question critics’ assertions H-1B visa holders are hired to save money. Data from U.S. Citizenship and Immigration Services obtained by the National Foundation for American Policy (NFAP) show from FY 2000 to FY 2011, employers have paid over $2.3 billion to the federal government in H-1B scholarship/training fees (generally $1,500 per individual), while a $500 anti-fraud tax/fee on each H-1B and L-1 visa has cost employers more than $700 million.

(A copy of the study from the National Foundation for American, where I serve as executive director, can be found here.)

Where Has the Money Gone?

There is no scandal here. No one claims the money has not gone to its intended purpose. But it is clear this topic has fallen through the cracks. Employers gain no political credit for paying the fee and neither the U.S. Department of Labor nor the National Science Foundation give much publicity to the training or scholarships that the fee funds. Nor do employers gain much credit for their individual efforts to train workers or support education.

According to the most recent annual budget document of the National Science Foundation, due to the H-1B fees assessed on each H-1B professional hired, “Approximately 58,000 students have received scholarships ranging from one to four years.” The scholarships can be as high as $10,000 and are used by U.S. undergraduate and graduate students pursuing math and science degrees.

Examining past budgets finds over 100,000 U.S. workers have received training via the H-1B fees paid by employers. In its annual budget document the Department of Labor describes its H-1B-funded job training initiatives as targeting “skills and competencies in demand by industries for which employers are using H-1B visas to hire foreign workers.”

Table 1

College Scholarships and Job Training Funded by Employers

Through H-1B Fees: FY 2000 to FY 2011

College Scholarships through National Science Foundation 58,000
Job Training through Department of Labor 100,000 +

Source: National Science Foundation, U.S. Department of Labor, National Foundation for American Policy.

Conclusion

Thirty percent of every H-1B fee goes to scholarships provided to U.S. students through the National Science Foundation. Fifty percent of the fee is allotted to training programs. That means every time an H-1B visa holder is hired (or his/her status is renewed), $450 goes to fund a scholarship for a U.S. student and $750 is sent to provide job training for a U.S. worker.

It is good that U.S. workers and students receive training and scholarships. Whether that money, particularly $3 billion worth, should come directly from employers when they hire H-1B professionals is less clear but it has been U.S. government policy for a decade. If these fees are to continue, then they should figure more prominently in the debate over skilled immigration. The fees call into question the assertions made that 1) employers hire H-1B visa holders to save money and 2) companies do not help educate and train students and workers. There is one point everyone should agree on – even in Washington, $3 billion is a lot of money.