How Immigration Reform Is Impacting IT Staffing
Hiring in IT is already difficult due to a limited talent pool, and each day signals that the situation will worsen. Turn on the television or open your browser to find yet another news item about US immigration policies. The topic has become a murky river that we are all floating down but cannot see through due to the flood of proposed changes, opinions, analyses, and court decisions. To get a better picture of what’s going on and what it means for you, let’s look at how immigration reform is affecting IT staffing.
Current H-1B Visa Abuse
The current H-1B visa process was designed as a lottery system allowing 85,000 total visas to be granted each year. While on the surface it sounds simple, this system has descended into chaos due to outdated laws that see poor monitoring and enforcement. There are widely known ways to abuse the system. Large offshore firms flood the program with tens of thousands of applications, greatly increasing their success rate in being granted H-1B visas compared to the U.S companies that are playing by the rules. And that’s just the start.
Not only are these large Asian firms receiving an unjustly large majority of visas, but they are also flagrantly violating US law and treating genuinely hardworking immigrant workers unfairly. They will frequently pay a worker a fraction of the appropriate salary reported to the government. These employees have also had their paychecks withheld until a client pays their employer, which is a clear violation of labor law.
Worse, malicious firms have gone even further, knowingly hiring workers who lack the necessary skills for success by falsifying resumes and references. A worker may be forced to live in a company-owned housing complex, pay 60 percent of their salary in rent to that company, and have no idea that they are doing so. These workers are often abandoned by such firms, which won’t sponsor them for an extension or green card so that the firm can profit from the turnover. Such turn-and-burn abuse has been allowed to flourish due to a lack of regulatory oversight.
Proposed Immigration Reform
Whether you like it or not, there are numerous proposed H-1B visa changes aimed at reducing such abuse through stricter enforcement, higher fees, improved site visits, and other means. Executive orders cannot change laws on their own and have simply requested that Congress review how current legislation is being enforced, particularly concerning the lottery system. While only 85,000 visas are issued each year, those three-year visas can be renewed for three more years plus a one-year extension, effectively extending their validity to seven years.
It’s currently estimated that there are up to 900,000 H-1B visas currently employed in the United States, a number that the government itself can’t even pinpoint. Furthermore, a large number of those visa holders have spouses who have been granted an H-4 visa, allowing them to work in the same capacity as an American citizen. The number of people on this type of spouse visa is estimated to be around 250,000, and the government is currently looking to reverse the 2015 measures that made these visas possible.
Furthermore, premium processing of H-1-B visas has been discontinued, limiting the ability to pay a higher fee for an expedited visa. With court interpretations and rulings constantly being delayed and congress debating endlessly, the chaos has proliferated to dangerous levels.
Hiring Alternatives
Organizations are already considering hiring alternatives in the face of potential change. According to studies, 59 percent of businesses will consider offshoring as a solution because it can provide cheaper access to international tech talent. Companies with a global presence in the United States will consider hiring more employees in their non-U.S. locations.
Unfortunately, there is no practical way for the United States government to punish or restrict such behavior. A Walmart employee working abroad is still an employee of an American company. Similarly, using fines to combat offshoring will paralyze entire organizations. If they cannot find talent within the United States, are not permitted to bring in the candidates they require on a visa, and cannot afford to outsource their work, they will be left with no options. Roles would never get filled, productivity would slow to a halt, and financial statements would quickly suffer.
Amplifying the Talent Shortage
Even before any major reform becomes law, there has been a noticeable impact on IT hiring. A “chilling effect” is discouraging talented tech minds from relocating to the United States. The 199,000 H-1B visa applications received this year are a significant decrease from the 236,000 received in 2021. Consider all of the bright IT talents from renowned tech hubs like India who decide to take their skills to Europe and encourage their children to do the same. The consequences for the IT staffing landscape in the United States could be long-term.
Moreover, those brilliant minds who are currently here are hesitant to transfer their visas to another company for fear of losing their work status. Many of these workers will be forced to continue working for large offshore body shop firms that mistreat them. In these situations, bright talent is frequently unfairly blamed for a system that can work if properly regulated. A large number of H-1B and H-4 workers contribute significantly to the US economy, and calls to eliminate these legal, tax-paying workers who buy homes, lease cars, pursue higher education, and buy local goods will have a massive negative impact on American businesses.
Overall, the confusion surrounding H-1-B visa reform is making it more difficult for employers to quickly find the right talent from a smaller pool of workers, exacerbating the current talent shortage. As the prospect of change scares away newcomers and current visas expire for others, the dwindling talent pool is likely to make skilled talent less available and more expensive for tech employers. Businesses can try to outsource or increase internal training and career path development, but without better regulation and thoughtful change, hiring in IT will become more difficult than ever.
Immigration Reform Is Impacting IT Staffing
Even lawmakers appear to struggle with understanding immigration reform and deciding how to curb exploitative practices. It’s an ambiguous and rapidly changing area that already affects every business in the country, particularly those that hire tech workers. But why deal with the uncertainty of IT staffing when you should be concentrating on your core business? Regardless of changing laws, the right staffing partner can relieve you of this burden and provide you with the talent you require quickly.
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