With H-1B Season Underway, Outdated H-1B Visa Program Is Costing Americans Jobs

It is that time of year where companies and individuals are preparing to send their cases to US Immigration to apply for an H-1B visa. Last year the entire cap was filled in the first week of filing, meaning many people were left out and could not get an H-1b visa. When thinking about how many people could not get jobs through this process, an organization that has studied the affects of H-1b visas on the market came out with a job loss calculator, which estimates the numbers of American jobs lost due to the lack of H-1b visas. Compete America’s calculator estimates that 500,000 new U.S. jobs could have been created this year absent outdated restrictions on H-1B visas. From another perspective, according to Compete America, the 2.37 million new payroll jobs created in 2013 might have been increased by 21 percent under a different H-1B scheme.

So what does this calculator really highlight? Well, the calculator clearly shows the fact that higher-skilled immigrant workers impact the U.S. economy, helping push cutting-edge innovation, which then creates more jobs for everyone. According to a new report by Standard & Poor’s, “Adding Skilled Labor to America’s Melting Pot Would Heat Up U.S. Economic Growth,” which means highly skilled immigrants help create jobs for American workers,  not take them away like many who stand opposed to increasing the cap would claim. Higher skilled workers actually complement U.S. workers’ skills instead of competing with them, and are more likely to start a new business than U.S.-born workers, which further increases innovation and productivity, according to S&P. Research from the National Foundation for American Policy suggests the hiring of each H-1B worker actually creates employment for 7.5 workers in small to mid-sized technology companies.

The insufficient number of H-1B visas goes to a deeper problem of having an outdated system that cannot respond to the demands of an ever-changing economy. Absent a few years of temporary increases, the cap on H-1B visas for skilled workers with bachelor’s degrees has been set at 65,000 per year for more than 20 years. Since demand far exceeds supply, the cap runs out every year, which last year’s cap was filled the first week it was open.

Based on last year’s demand, Matthew Slaughter, an economist at Dartmouth who designed the jobs loss calculator, estimates that 100,000 more H-1B jobs could have been filled last year but for the cap. Slaughter’s estimates believe that 400,000 additional jobs were lost indirectly based on lost job creation both by the immigrant-hiring companies and by the suppliers of these companies not hiring additional U.S. workers. It is notable that the legislation that passed the Senate in 2013 and various House proposals include an increase in the H-1B visa cap. Reform of the H-1B visa program and other skilled-worker programs is essential to our economy’s growth, balance the U.S. budget, and fostering greater job growth, innovation and productivity while maintaining our competitive edge in the international technology industry. It is clear that the H-1B cap must be increased to reflect these changes, or the U.S. will continue to lag behind in an increasingly competitive world.