The Bottom of the Pay Scale: Wages for H-1B Computer Programmers (2005)

by griff1986 • 10 years ago

42 39 10 years ago

This article is fairly typical of ones critical of the H1B program: it looks at average programmer wages instead of controlling for experience or skills. As we all know, wages for programmers vary widely.

eloisant2• 10 years ago

Yes, and H1B can only be renewed for 6 years, and anyone staying longer (and making more with more experience) switches to an green card then eventually citizenship.

Additionally some the highest paid foreigners are on an O1 visa, so they don't count in the "H1B average" (while the highest paid Americans are in the same bag as the others).

JPKab• 10 years ago

I think that the non-abusers of the program are truly in need of people with special skills that can't be found.

However, the "average programmer" salary is actually very effective when looking at the aggregate. If a programmer has skills that can't be found in a given location, you would expect them to command a very high market value, rather than an average, let alone below average market value.

Tata, Infosys, etc have ruined the H1B for what it was supposed to be used for. The government's useless bureaucratic oversight allows companies to claim that a journeyman SQL Server DBA is impossible to find in the US and hire from a body-shop instead.

The biggest victims of this are the start-ups who truly need to bring in top-caliber talent and can't get a visa in the lottery.

learc835• 10 years ago

So you're saying that if we control for skill and experience H-1B programmers don't make less, but their overall average wage is less.

That means that we are hiring H-1B workers who are less skilled than the average US worker. How is that any better?

nostrebored2• 10 years ago

How is the parent saying that? I'm interpreting this as given two identical employees an h1b would be paid less.

nostrebored2• 10 years ago

How is the parent saying that? I'm interpreting this as given two identical employees an h1b would be paid less.

diogenescynic2• 10 years ago

instead of controlling for experience or skills.

They lie about this on the H-1B applications and game the prevailing wage system. If you've ever applied for an H-1B then you know how easy it is to abuse the prevailing wages. The process to evaluate the skills of the applicant is simply filling out a form online for their experience level, job title, and location. Give it a test here: http://www.flcdatacenter.com/OesWizardStart.aspx It's very easy to game their job title and location to lower the salary.

surfmike• 10 years ago

Here's an idea: auction off H1-B spots based on salary each month. And require the employers to pay that wage annually for at least 4 years. Would keep the H1-Bs for the most valuable candidates, and prevent its abuse as just a way to import cheap labor.

A special pool for startups would be nice too, with less costs/requirements.

I'd personally be in favor of getting rid of the cap entirely or increasing it several times at least, but these might be more realistic reform ideas.

2sk21• 10 years ago

Agreed - the current lottery mechanism is the worst possible way to distribute these slots

akavi• 10 years ago

I'd also make the visa attach to the person, not the company. (Ie, the person can change jobs, taking the visa with them, so long as they keep the auction-winning salary level or higher.)

As for:

A special pool for startups would be nice too, with less costs/requirements.

...why?

learc835• 10 years ago

Yeah why should startups get to avoid paying market prices. If you want to subsidize starups do it directly, don't assist then in depressing wages.

UK-AL• 10 years ago

I believe the auction should include equity rather than a special pool.

st3v3r3• 10 years ago

"And require the employers to pay that wage annually for at least 4 years."

So no raises in that 4 years? And they're still tied to the company?

st3v3r3• 10 years ago

"A special pool for startups would be nice too, with less costs/requirements."

No. Startups should not be given special treatment. Otherwise Tata, Infosys, et al would suddenly become "startups".

vadym909• 10 years ago

Great idea, but expect some resistance. The worst abusers are fighting even a minor increase $2K in the visa fees. http://in.reuters.com/article/india-united-states-visa-idINK...

untog• 10 years ago

A special pool for startups would be nice too, with less costs/requirements.

That's a pretty huge caveat, given that the industry has no definition for what a startup even is.

That's the problem with the idea of auctioning off H1Bs, as far as I can see it - startups would suffer. It also turns the H1B visa into a visa for people of extra special talent, and the O1 visa already exists for that.

lhc-• 10 years ago

To be fair, H1Bs are already only supposed to be used in the case where you can't find an American for the job, which already suggests the visa holder should have some extra special talent because they can do a job no American can.

fredophile• 10 years ago

How would startups suffer? The stated purpose of the H1B visa is to fill in for labour shortages. If there is a labour shortage you would expect costs (salaries) to rise. Basing the visas on salary should help to identify and target areas where labour shortages actually exist. Bringing more workers in should make all workers in the field cheaper than they would be if you didn't bring in the extra workers. This should benefit startups even if they don't hire H1Bs.

Also, the current system isn't great for startups. There are far more H1B applicants than there are visas. There are a few large companies that bring in the majority of H1Bs. These large companies can afford to apply for thousands of H1Bs knowing that only 50% or less will be approved. A startup hiring a handful of people can't afford to put in the application for a handful of people knowing that there is a very real chance that none of them will be approved. Even if they are approved, applications need to be in several months before the visa is issued. How many startups are hiring in March for a position they won't need to fill until October?

dominotw• 10 years ago

Here's an idea: auction off H1-B spots based on salary each month.

Oh the weekly 'auction h1b' discussion.

same exact discussion from last week https://news.ycombinator.com/item?id=11188243

ones_and_zeros• 10 years ago

This won't work because there will need to be a floor for the wage, which we already have and has proven to not work.

If we do go to an auction you'll see the floor slowly dropped similar to how the DHS has been expanding the OPT program in secret.

Bottom line is there isn't a STEM shortage, there is no need for H1B or OPT. It's just another form of corporate welfare at the expense of the middle class.

serge2k• 10 years ago

Bottom line is there isn't a STEM shortage,

Tech companies don't care if we have 10000 biochemists sitting around doing nothing. STEM is a overused term.

dj_doh• 10 years ago

Once again, I second the salary-based auction of H1B visas. But there should be no special pool for startups. What is stopping me from setting up a pseudo-startup-body-shop and misuse these quotas?

1. Salary-based auction, 2. Do not bind employee to employer after 1 year, and 3. GoTo #1.

1024core• 10 years ago

I've heard variations of the theme from others, and it makes total sense to me. It is a dead simple to implement: just rank the requests in descending order of salary, and take the top N. Boom. Done.

Of course, if a company then reduces the salary later, or does some shenanigans, nail them under the "intent to defraud the government" laws.

Some people are suggesting tweaks: make an exception for startups .... take the geo location into account ... etc. etc. That makes this more complicated, and adds more avenues for cheating. Keep it dead simple, and problem solved.

blibble• 10 years ago

A special pool for startups would be nice too, with less costs/requirements.

so infosys will start 500 subsidiaries and fund them VC style

learc835• 10 years ago

The only real way to prevent this is to raise the price. Either through auctions, increased fees, or increased minimum salary.

If you can't find someone at the prevailing wage, you have to offer more. That's how the prevailing wage increases. Increasing the supply of workers willing to work for the current prevailing wage depresses wage growth--there's no way around it.

eloisant2• 10 years ago

This is not evidence that H1B make less for similar skills/experience. Just a big average.

Fees and paperwork is already fairly high, so I don't think companies hire H1B to cut costs.

slantedview• 10 years ago

Actually, many companies have said outright that they do hire H1Bs specifically to cut costs, and other studies, including by the CIS have found just that.

learc835• 10 years ago

If that is the case, then it means we are hiring H-1B workers who are less skilled on average, than the average US worker.

If H-1Bs weren't available, companies would be forced to keep raising the offered salary when they couldn't fill a position. Virtually any position can be filled given a high enough salary. Therefore if companies are choosing to hire H-1Bs instead of raising the salary to the level necessary to fill positions with US workers, then it is because it is cheaper to pay the H-1B costs.

st3v3r3• 10 years ago

Well, with H1B hires, you don't have to worry about turnover for a set period of time, and you get to use the threat of deportation to get them to do what you want.

coldcode• 10 years ago

2005 should be in the title

dang• 10 years ago

Yes.

notlisted• 10 years ago

This data is from 2005! A lot has changed since.

I can't quickly google the date it changed (before of after 2005?) but during the first bubble of 1999-2001, H1B holders were beholden to their employers as they were not allowed to look for another position or switch companies. The only official choice was to leave the country. This made employees virtual slaves to their employers (I was one of them) and was a great way to ensure artificially depressed wages (no competition => no risk of them leaving => so no reason to pay them a competitive wage).

I suspect, no data here, that this situation has changed a little. H1B wages may still be on the lower end of the spectrum, but that would be mostly driven by the (IMHO absolutely crazy) development of 60%+ of H1B visas going to body shops. This should change. Quotas for the Tatas. Give lone wolf applicants a chance again to come to the US and make this a better place.

PS One thing many critics of the H1B program forget: H1B holders pay into the social security system, but unless they reach the required 40 points, they have no right to collect. The only way reach 40 points is to work here 10 years (4 points per year) but the max H1B duration overall is 6. Unless they get a greencard, through marriage or company sponsorship, they only add to the coffers without the chance of collecting.

sveiss2• 10 years ago

You can count US social security contributions towards the requirements in other countries (and vice versa) if they're covered by one of the treaties: https://www.ssa.gov/international/agreements_overview.html .

It's a short list of countries, though, and doesn't cover the top H-1B senders

esaym• 10 years ago

the program is vital to U.S. competitiveness because it allows the world's "best and brightest" to come to America and helps sustain U.S. leadership

If it is truly the "best and brightest", then why are they paid so low?

pc86• 10 years ago

Because there is no risk of them leaving if they are tied to the company. That's a huge blow to supply, which depresses wages.

diogenescynic2• 10 years ago

Wages for H-1B workers in computer programming occupations are overwhelmingly concentrated at the bottom of the U.S. pay scale. Wages on LCAs for 85 percent of H-1B workers were for less than the median U.S. wage in the same occupations and state.
Applications for 47 percent of H-1B computer programming workers were for wages below even the prevailing wage claimed by their employers.

That is pretty damning evidence. The program is clearly not being used for its intended purposes. When somewhere between 47 and 85% of H-1Bs are being significantly underpaid compared to their peers, the program is not being used to being over workers with "specialized knowledge" as they claim--but to drive down wages. It makes sense though, when you look at the biggest H-1B recipients: http://www.myvisajobs.com/Reports/2015-H1B-Visa-Sponsor.aspx It's all low quality outsourcing shops like Infosys, TCS, Wipro, HCL, and Cognizant.

Make the H-1B 'lottery' into an auction. Instead of accepting 65,000 H-1Bs at random--accept the 65,000 H-1Bs with the highest wages. That way we are getting the immigrants with the highest valued skills and stopping companies like Infosys, TCS, Wipro, HCL, and Cognizant that game the immigration system by applying for the cheapest H-1Bs possible.

The Bottom of the Pay Scale: Wages for H-1B Computer Programmers (2005)

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