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A viewpoint by Thomas D. Elias: H-1B quotas go begging as skilled immigrants lose jobs

June 26, 2001

Only about nine months ago, no topic was hotter in U.S. and California politics than H-1B visas — the time-limited entry permits granted to immigrants with special skills needed by American companies.

Double the limit on H-1B workers or we won't be able to fill our orders, whined high-flying companies like Cisco Systems, Hewlett-Packard, Oracle and other Silicon Valley kingpins. These firms and their executives lined the pockets of politicians from George W. Bush and Al Gore to Dianne Feinstein and John McCain with hundreds of thousands of campaign dollars and they got their way.

Congress upped the limit on H1-B visas from 115,000 to 195,000 per year through 2003, even though labor unions and other analysts claimed H-1B workers are paid lower wages than Americans with the same skills and their presence often leaves qualified U.S. citizens jobless.

Now those arguments are largely moot. Midway through this spring, the federal Immigration and Naturalization Service reported that just 72,000 H-1B visas had been issued since the start of the fiscal year Oct. 1. That's a pace slightly slower than last year, and means that many of the once-coveted visas — and all the new slots — will go unfilled this year.


Not only will the visas go begging, but so might some of the workers who used them to enter this country.

No one knows just how many H-1B immigrants have lost their jobs in the slump of technology and Internet companies.

"We're trying to find a way to figure out how many have been displaced," said Eyleen Schmidt, spokeswoman for INS.

Even though no specific figures exist, bet that the number is high, for the old rule of last-hired, first-fired seems to apply to H-1B visa-holders as much as it ever did to anyone else.

When Cisco's stock slid and the company announced this spring it would dismiss 2,500 to 3,000 temporary and contract workers, spokesman Kent Jenkins Jr. said "it's likely that will involve H-1B workers." When an official San Francisco report predicts that 80 percent of the city's myriad dot-com companies will fail and disappear before year's end, that means lots of H-1B jobs also are going down the tubes.

It's not just the jobs that are disappearing. Even where jobs remain, money is drying up. One H-1B labor contracting firm that provides immigrant consultants to many companies reported "Java (a computer operating system) developers used to float in the marketplace at $65 to $75 per hour, but right now the market is $40." Overall, she said, wages paid H-1B workers have dropped 25 per cent to 50 percent.

Idled workers have piled up. One Silicon Valley labor contracting firm confided last month that while it normally has between 10 and 12 persons of its 100-member force idle for short periods between contracts, that number is now upward of 25 and climbing.

Legally, H-1B workers have just 10 days after losing one job to find another. If they can't they're supposed to go back home. If they start working here again after technically losing their visas when that 10 days expires, they risk being barred from the U.S. for 10 years.

Some are indeed heading home, if only because they can't afford to stay when they're not being paid. Others are receiving illegal under-the-table payments from labor contractors who hope they'll be available when and if the technology job market once again turns prosperous.

Such payments usually amount to no more than $1,000 per month, not exactly enough to buy and fuel the BMW's in which many highly skilled workers envisioned themselves tooling around California.

It's all part of the boom/bust cycles that have long been a feature of California life. The real victims here are not corporate executives whose stock options have gone south but workers who never figured they'd quickly become illegal immigrants and be forced to live six or eight to a one-bedroom apartment.

The moral, if there is one: Next time a trendy industry pulls out all political stops in search of a special benefit, why rush to grant it when no one can be sure how long the boom will last?

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