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Is The H1B Visa Program Necessarily Bad For The U.S. Economy?

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Do H1B visas have a negative impact on the U.S. economy?

One of the main reasons for the opposition of the H1B visas is that they replace native workers with foreign workers and thus, result in fewer job prospects for the Americans. Trump’s famous campaign slogan of “bringing jobs back” led a lot of Americans to vote for him in the hope that he will rescind the H1B visa.

This leads to the question, do H1Bs have a negative impact on the U.S. economy?

Studies suggest the opposite.

A study released by the National Bureau of Economic Research showed that foreign workers and native workers cannot be exchanged for each other and thus they are not identical. In fact, they are complementary workers.

The rise and fall of jobs for workers who come to the U.S. on an H1-B visa and their American counterparts have been associated together. The studies found that when foreign STEM workers were denied visas, American companies did not necessarily employ more native workers. The wages paid to the American workers and their employment opportunities remained the same even when workers from other countries were not given H1B permits.

The demand for workers or the unemployment of workers in STEM cannot simply be calculated by the number of native-born people who graduate with a STEM degree. This is because their choice of profession and the job skills required by the labor market keeps changing. So, while an ‘xyz’ number of Americans may graduate with a STEM degree, we cannot definitively say that all of them will pursue a profession in the sciences. Therefore, merely looking at the number of graduates with a STEM degree to argue against the employment of H1-B workers, is a flawed reasoning.

H1-B workers greatly contribute to an invention in the U.S. economy and numerous researches have been conducted to corroborate this point. The research led by Jennifer Hunt and Marjolaine Gauthier-Loiselle in the National Bureau of Economic Research found that with one percent increase in the population of immigrant college graduates, the overall patent per-capita increased by 9-18 percent.

The inflow of foreign talent provides a lot of intellectual diversity that consequently boosts the economy. Foreign workers are brought up in different environments, religions, and cultures. So, their way of approaching a problem or working on a given task is considerably different from the native-born workers. Homogeneity in thought processes can often lead to road-blocks. Thus, the different assortment of ideas that foreign workers bring in, substantially helps in innovation.

It is difficult to determine the net effect of the H1B visa program on the U.S. economy. However, there is no denying that it has significantly contributed to innovation and economic growth.

For more information about the H1B visas, stayed tuned for the weekly publishings!

 

Read more: Should You Be Worried About H1B Visas Under Donald Trump?

 

 

4 Comments

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  • **ck h1b visas. You can manipulate numbers all you want but the bottom line is h1b visas hurt American technology workers. We have people who hit the ripe old age of 40 training someone from India to take their job. This mean this 40 year who might have a teenager about to enter college or who has to pay a mortgage will be unemployed. What this mean in real terms is suffering for the American worker. The CEO’s and c-suite executives get to go buy million dollar homes and the Indian gets a job on the other side of the world. Could you imagine if Canadians imported Americans to take Canadian jobs a Canadian is already doing? No Canadian would support this.

  • Those born here with Computer graduate degrees are going to other professions since most entry level jobs are outsourced and senior developers are fired to replace with cheap foreign labor. Around 5 million software engineers working in Usa with some kind of employer dependent visa, salaries of 1980 isn’t even there now when value of 1 dollar was 50 times more than today, almost 80% of software development jobs are outsourced to consulting companies and they bring H1b and L1b from overseas with entry level salary

  • H-1B is a 200 billion dollar industry. These people will not easily give up. They will give some money to Lobbyist. They will give some money to “Fake News”. They will give some money to the Corrupt Politicians. Let’s say they spend 10 Billion dollars, They can still make 190 Billion dollars. I am sure they have a list of CORRUPT people to approach. These people do not care about unemployed Americans.

  • David, you aren’t distinguishing between immigration and outsourcing. They have very different effects on the economy. While immigrants can take takes that natives could have, they are working within our economy, consuming within our economy, investing, and thereby contributing. They can take jobs, but they also create jobs. When you speak of the “Indian” on the “other side of the world”, you are talking about outsourcing, sending our jobs overseas. This contributes nothing to our economy, and is only a drain. It’s only advantageous if outsourcing is mutual between countries, that is, trade is relatively balanced. But this has nothing to do with visas.

About the author

Ateeya Sandhu

Ateeya Sandhu

Ateeya Sandhu is studying International Relations at the University of Toronto. She is an avid reader who is extremely passionate about feminism, equality rights and social problems in India. An altruist at heart, she dreams of opening her own charitable organization one day.

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