U.S. tech giants have been sacking employees in droves while simultaneously importing tens of thousands of foreign workers.
Amazon, Google and Microsoft have laid off at least 27,000, 12,000 and 16,000 employees, respectively, since 2022. However, in that same roughly three-year period, the companies have secured at least 61,000 H-1B visas combined for foreign workers, according to U.S. Citizenship and Immigration Services.
“At the same time large tech companies are laying people off they are claiming they don’t have sufficient workers,” Eric Ruark, director of research and public relations for NumbersUSA, told the Daily Caller News Foundation. “The H-1B program is designed specifically to allow employers to replace and displace qualified American workers with cheaper, often less competent foreign guest workers.”
The U.S. H-1B program allows businesses to employ skilled foreign workers with bachelor’s degrees for up to six years, with H-1B holders eligible to apply for permanent residence, and ultimately citizenship.
In theory, the visas are “need-based,” meaning they are only meant to be given when there is a demonstrated need that cannot be readily filled by the American workforce, however, U.S. census data shows that of the 50 million employed college graduates between ages 25 and 64 in 2019, just 28% of those who reported a bachelor’s degree in science, technology, engineering or math (STEM) actually work in a STEM occupation. Moreover, a November 2014 study from the National Bureau of Economic Research (NBER) found that one additional H-1B visa recipient crowds out about 1.5 other workers at a firm, and that additional H-1Bs are not associated with higher numbers of patent approvals, suggesting H-1B workers may not increase innovation.
Together, the census and NBER study findings could suggest tech giants import talent from abroad not because of a lack of domestic talent, but rather because of other considerations like wages and employee retention.
Historically, employers have paid H-1B workers well below market wages, with a 2020 study from the Economic Policy Institute finding that, in fiscal year 2019, 60% of H-1B positions certified by the U.S. Department of Labor (DOL) had been assigned salaries below the local median wage for their occupation. At Amazon and Microsoft, for example, three-fourths or more of their H-1B workers were assigned to the companies’ two lowest wage levels in fiscal year 2019.
In addition to lower wages, corporations may also prefer H-1B workers because they are often easier to retain, according to Ruark: “It’s not just lower wages that make H-1B workers attractive. H-1B recipients have to work for the employer who petitioned for them. They can’t just walk across the street to a competitor. If they lose their job they lose their visa.”
H-1B workers must work for the company that sponsored their visa, meaning in order to work for another employer they have to get another H-1B petition approved. As a result, H-1B workers have less mobility than their U.S. counterparts and are easier for businesses to retain, which can make them an attractive option for employers.
The visa program has come under fire in the past due to alleged abuse by employers, with the DOL launching an investigation into Disney in 2015 following reports the company fired hundreds of tech workers and forced them to train their foreign replacements. One of the former Disney employees called to testify in the trial told the court that “the situation at Disney is not an anomaly” and that “this same abuse of the H-1B program is happening nationwide.
An advocacy organization for tech workers based in Summit, New Jersey, published a video in 2007 that features Lawrence Lebowitz, an attorney for Pittsburgh-based law firm Dentons, Cohen & Grigsby, explaining how to place help-wanted advertisements in such a way that people won’t respond, thus allowing the company to claim no qualified Americans are available.
“Our goal is clearly not to find a qualified and interested U.S. worker,” Lebowitz says in the video. “And that, in a sense, sounds funny, but it’s what we are trying to do here.”
Additionally, three Indian-origin men are currently facing ten years in prison for submitting fraudulent H-1B applications that claimed foreign workers had specific jobs waiting for them that did not actually exist. The case is not unique, with another lawsuit claiming an Indian man set up 13 shell companies in order to place multiple applications for his clients and thus increase their chances in the H-1B lottery, charging them a percentage of their future earnings in exchange for his services.
Indian nationals received more than 72% of U.S. H-1B visas in fiscal year 2022, with Chinese nationals representing the next largest share at 12.5%, according to The Times of India.
America’s current H1B skilled visa system is a complete giveaway to corporate America, primarily big tech. We bring in skilled foreigners only when a company sponsors them. The system then keeps many of these workers in a legal limbo, often for decades. That whole time they are… https://t.co/RwzFk2kwLz
— Neil Patel (@NeilPatelTDC) December 27, 2024
Debate regarding H-1Bs erupted on X last week after Department of Government Efficiency (DOGE) co-chairs Elon Musk and Vivek Ramaswamy voiced their support for the program.
“There is a permanent shortage of excellent engineering talent,” Musk wrote Wednesday. “It is the fundamental limiting factor in Silicon Valley.”
“The reason top tech companies often hire foreign-born & first-generation engineers over ‘native’ Americans isn’t because of an innate American IQ deficit (a lazy & wrong explanation). A key part of it comes down to the c-word: culture,” Ramaswamy added in an X post Thursday. “Our American culture has venerated mediocrity over excellence for way too long.”
Ramaswamy and Musk received backlash for the comments, with some critics claiming the H-1B program prioritizes foreign workers over Americans and that Ramaswamy’s critique of American culture is unfounded.
“There is nothing wrong with American workers or American culture,” former South Carolina Gov. Nikki Haley wrote in a post on X Thursday responding to Ramaswamy. “All you have to do is look at the border and see how many want what we have. We should be investing and prioritizing in Americans, not foreign workers.”
“I take issue with some of the discourse I’ve read online today suggesting ‘lazy American culture’ is the main driver for why we need to continue the H-1B program,” Robert F. Kennedy Jr’s former running mate, Nicole Shanahan, wrote on X Thursday. “Let’s be real: tech companies getting massive breaks on cheap labor at the expense of the American way of life is predatory.
President-elect Donald Trump appeared to come out in favor of H-1Bs on Saturday, telling the New York Post, “I’ve always liked the visas…I’ve been a believer in H-1B. I have used it many times. It’s a great program.” Trump had previously opposed H-1Bs, telling Megyn Kelly in March 2016 that “the H-1B program is neither high-skilled nor immigration: these are temporary foreign workers, imported from abroad, for the explicit purpose of substituting for American workers at lower pay.”
Regarding the internal debate in the Republican Party over H1-Bs, Ruark told the DCNF, “President Trump’s going to have to take a side. Is he going to side with the American worker, which is how he got elected, or will he side with the Musk-ean ‘illegal [immigration] bad, legal [immigration] good’-wing and opt to secure the border while massively expanding legal immigration.”
Amazon, Google and Microsoft did not respond to requests for comment.
(Featured Image Media Credit: Google AI with magnifying glass, Wikimedia Commons/Jernej Furman)
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