The Myths of Foreign Labor: Demystifying the H-1B Category

You’ve heard it all before: “Foreign workers are bad for America.” We are told that immigrants not only mean “cheap” labor but that they also take jobs away from U.S. workers. Is there any truth to this?

As a business immigration attorney who has helped bring hundreds of professionals to the U.S. (and keep them here), I am grateful for the opportunity to tell the real story behind the myths.

First, a little background:  One of the most common ways that we bring foreign workers to the U.S. is through the “H-1B” program. We call this the “Specialty Occupation” visa category because it was designed for foreign workers who possess at least a bachelor’s degree and will fill U.S. positions which require at least a bachelor’s degree in a specific field(s). Congress only issues 85,000 visa numbers for first-time H-1B applicants each year; of these, 20,000 visa numbers are limited to applicants who obtained master’s degrees from U.S. institutions. Because demand for H-1B visas considerably outweighs supply, first-time H-1B applicants must first enter an annual lottery that takes place in March. In recent history, only about 35% of applicants will be selected in the lottery each year. Selected applicants then submit a petition to U.S. Citizenship and Immigration Services, which must then determine if each applicant is indeed eligible for the visa according to very specific standards. Once an applicant is approved, he or she can start the H-1B employment on October 1 for an initial three-year period. The newly-minted H-1B holder will not be subject to the lottery again for subsequent renewals.

MYTH #1: The H-1B Category Promotes Cheap Labor.

Spoiler alert: this is false.

In every H-1B petition, employers must certify that they will, in fact, pay the worker at or above a “prevailing wage” set by the Department of Labor (DOL). The “prevailing wage” is the fair wage calculated by the DOL among similarly employed workers; i.e. individuals working in the same occupational category and geographic region. The DOL breaks wages into four levels; a Level 1 wage is for an “entry-level” position whereas a Level 4 wage is for positions requiring the highest degree of knowledge or skill in the field. In any event, the employer must pay at least the prevailing wage or be subject to serious penalties if audited by the government.

As part of the H-1B process, employers must notify the entire workforce at the foreign worker’s intended worksite of the employer’s intent to hire an H-1B worker. This notice, which must be posted in two visible places at the worksite, must also stipulate the foreign worker’s intended salary. While this can feel like a massive invasion of privacy for both the employer and H-1B applicant, it shows fellow workers that the foreign national will indeed be paid a fair wage.

Here's the bottom line: employers cannot give simply set an arbitrarily low wage for foreign workers. The DOL has created built-in protections for these workers to ensure they are being paid a wage commensurate with the position’s education, experience, skills, and supervision requirements.

MYTH #2: H-1B Workers Take Jobs Away from U.S. Citizens

“We have searched high and low for a position and after months of active recruitment the only qualifying applicant is [the foreign national].”

I hear this almost daily from my corporate clients. Jobs in numerous sectors simply cannot be filled by the U.S. citizen workforce.  The reality is that far too few U.S. citizens are pursuing higher education in STEM fields (e.g. Biology, Physics, Chemistry, Medicine, Engineering, Computer Science, and Math), thus leading to major gaps in the workforce in an economy that needs STEM more than ever.

According to a report by the National Association of Manufacturing and Deloitte, the U.S. will have to fill 3.5 million STEM jobs by 2025, with more than 2 million of them going unfilled because of the lack of highly-skilled candidates in demand. Bullhorn’s 2018 North American Staffing and Recruiting Trends Report found that “skills shortage” are one of the top challenges for 73% of firms serving manufacturing industries and 65% of those in information technology, accounting, finance, and insurance fields.

The President’s Council of Advisors on Science and Technology, a group that advises the President on matters involving science, technology, education, and innovation policy, has found a need for at least one million more STEM professionals than the U.S. is able to produce over the next decade if the U.S. is going to remain competitive in these fields.

Need I continue? The solution to building our economy and closing this labor gap is foreign talent.

Another point to consider: submitting an H-1B petition is expensive. After spending several thousands of dollars on legal fees, a company with 25 or more employees will need to pay at least $2,460 to file an H-1B petition, plus an additional $1,440 expedite fee if they wish to hear a response from USCIS within 15 days (otherwise, they could be looking at 4-6 months for a response, which is often not practicable from a business perspective).  

Still worried about the long-term implications of bringing foreign workers to the U.S.? The green card process for H-1B employees (i.e. the road to permanent residence) quite literally requires employers to prove to that there is no other U.S. citizen worker who can perform the foreign worker’s job. Employers must undergo a rigorous recruitment campaign and interview any probable candidates, among other steps. Next, both the DOL and U.S. Citizenship and Immigration Services must each certify that the applicant is indeed the appropriate candidate for the job before the foreign worker can even ask for the physical green card to be produced.

Ask yourself: would an employer undergo these time-consuming and costly processes if the foreign worker’s talents were easy to find? No! Foreign talent is of massive importance to employers’ bottom lines. By engaging with the H-1B process, companies and organizations are doing what is necessary to stay at the cutting edge of their industry and enhance their offerings.

In Conclusion …

There will always be stories that are less than flattering about U.S. business immigration (here’s looking at you, Disney World), but as with anything in life, I urge you to do your research before jumping to conclusions about foreign workers.

If nothing else, take it from me: my clients are brilliant software developers, pioneering engineers, and life-saving medical practitioners. Through their key role in making industry advancements, particularly in STEM fields, foreign workers allow the U.S. to compete internationally through innovation.

Trust me when I say that we owe so much to immigrants. These folks have bravely left their countries to reach their highest potential, and in doing so, they help America reach its own.

I dedicate this piece to my clients and to any immigrant reading this. YOU make this country great.