Does the new H-1B hiring rule for TARP Recipients help US workers?
February 10, 2009
On Feb 6th 2009, US Senate approved a bill that restricts on US companies hiring H-1B visa holders that receives federal Troubled Assets Relief Program (TARP) fund. I am not sure how much it is going to help US workers, the restrictions prohibits TARP recipients hiring H-1B visa holders directly. Still they can hire outsource vendor’s employees who has H-1B visas to work in their projects in US. Also the bill does not restrict TARP recipients sending work to offshore locations.
Does the new restrictions affect H-1B visa holders?
Not really, each year US grants 65000 H-1B visas to foreign nationals, the new restrictions may affect H-1B visa holders those who are seeking direct employment with US financial institutions and it will be very negligible. Even foreign nationals graduating with advanced financial degrees can still work with TARP recipient companies through outsource vendors like TCS, Infosys, Wipro, IBM, Accenture, etc.
Does this new restrictions help US citizens?
I don’t think so, before hiring any H-1B visa holders any US employer must prove that they couldn’t find any US citizen to fill that position. The additional restriction imposed by TARP recipients does not help US job seekers laid off from financial institutions any thing better than current H-1B visa rules. TARP recipient companies can still layoff US citizens and hire H-1B visa holders through outsource firms or outsource the jobs to offshore locations. They can also bring in L1 Visa holders either directly if they have captive centers in offshore locations or through outsource vendors.
Does the new H-1B rules help outsource vendors?
Yes, since the TARP recipient companies cannot hire qualified foreign professionals directly for two years, these companies need to employ US citizens, if they didn’t get any qualified US employees or if they want to cut their payroll expenses they have to hire outsource vendor’s employees or send projects to offshore locations. In either case outsource vendors will benefit from these new restrictions.
What are the long-term impact of the new H-1B restrictions?
There will not be any long-term impact on H-1B visa programs or to offshore outsourcing due to these restrictions. Some observers may argue that H-1B visa protectionism like this will affect the long-term US growth and other nations may retaliate to impose restrictions on US goods. But I think the new H-1B restrictions are very minimal and the President Obama’s administration needs to do something to satisfy the 598,000 people who lost their jobs in Jan 2009 and to satisfy their own party members so that the entire $838 billion stimulus bill can be passed smoothly in the US Congress.
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16 Responses to “Does the new H-1B hiring rule for TARP Recipients help US workers?”
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I wish the Congress can pass more strict H1B visa rules so that Indian companies can stop abusing H1B visa rules. US citizens are getting laid off and these companies are abusing the rules and brining workers from India for cheaper wages. I think they should stop the H1 visa all together for next two years until US economy comes out of recession
Not sure why everyone is blaming H-1B visa holders when things go bad for US. Some companies abuse the H-1B visa system but most of the companies do follow the strict rules and regulations when bringing people from other countries to US. All the H-1B visa holders pay all the federal, state, FICA, and all other taxes. But when they loose their job they can not claim social security benefits just like US citizens. Even though H-1B visa holders and their employers pay underemployment taxes, they can not benefit from it and they have to go back to their native countries.
Federal investigators identified 20% of fraud in random sampling of 246 H-1B visa applications, this too bad for US employees. Can the congress do something to close the loop-holes in the entire H-1B visa application process? Also I’ve known legal H-1B workers are waiting for their Green card for more than 7 years and this should also be changed.
-Jef
H1B/L1 has become an easy option for US companies to get rid of americans and replace them with cheaper resources through outsourcing. Technically speaking these visas were meant to be used to hire skilled workers if there aren’t any US citizens available.But is that what is happening? Definitely not. But companies don’t think that by giving away jobs to offshore, they are effectively cutting down the economic cycle leading to the down fall of US economy. You cannot afford a living if your pay check shrinks or stops.Also indians should understand that H1B visa is meant to be in the interest of US and DEFINITELY NOT INDIANDS. Also when we come to US in H1 we understand the risk that if we loose job then we have no option other than to go back to India. But when it happens we rant and rave. We take risk because it pays well. Why are we so dumb to realize and understand the risk part properly.
[...] cost and increase their competitive advantage. Though the current Obama administration has some policies against sending work to offshore location, the trend is unstoppable as US companies find more value [...]
Guys I dont’ understand. Everyone knew / hear about below statement several times. Still why we’re talking about stopping H1B’s. These are the people who made Sillicon Valley. You guys want US / Obama govt to kill the Goose…?
“Immigrants have founded hundreds of thousands of US companies (including co-founding Google, Intel, Sun, eBay and Yahoo), plus more than 50% of all high-tech companies in Silicon Valley….”
[...] proof were needed that the Obama government’s recent curbs on H-1B visas might cast a long shadow on the already darkened clouds hovering over the US economy, log in to [...]
Its really absurd that the Obama Government apply curbs on H1B visas, not sure how this is going to help the American Citizens. If the American Citizens were so educated and qualified then probably outsourcing would never have started in the first place. Now with the new rules, any company receiving TARP funds will automatically qualify as a H1B dependent company and they then have to comply with the H1B dependent rules, which are quite rigid. Most of the jobs too these days that are advertised ask for Citizens or Green Card Holders making life really tough for H1B visa holders
Are you kidding. Do you really think companies adhere to H1B visa hiring policies. Most of the H1′s I worked with are just plain old vanilla programmers. The difficult jobs of defining technical/business strategies and architecting and designing solutions are done by highly skilled American workers. The American public has a misconception that INdian workers are smarter and better. There are many America programmers who are out of work because their jobs are being either outsourced or given to consultants on H1B visas at a lower cost. The Indian consulting firms do not hire Americans programmers. My brother was hired by an Indian consulting firm for a year. He worked 8 days the entire year. His job was to go to meetings in the states to give clients the impression that Americans worked for the firm. He called himself “The AMERICAN Presence”. Both the government and American companies need to stop lieing to the American people. American technology workers just want a level playing field.
[...] due to the plunging economy, shifting client or customer landscape and now the resurgence of protectionism, the strategic decision-making processes at many companies have slowed to a crawl or have [...]
All, absolutely all highly quantitative employees in large financial institutions are emigrants (some of them already went thorough F-1, H1-B, GC, Citizenship). Why? Just because American education sucks compared to that in Russia, Europe, China and India. There are many foreign students at the best US graduate schools, and these students are much better than Americans who are having extremely hard time to get their PhDs (if at all) in quantitative fields. Hey, Americans, you have to accept that you do not stand a chance against H1-Bs, simply because they are smarter and period. That is why companies are spending a lot of time and resources to hire foreigners: it costs approximately $5000 to file a single H1B petition and much more to file a green card. Lousy politicians try to make their carriers by writing bills and amendments. H1-B is a hot topic since any H1-B discriminating bill will pass, and the politician will have his name on the bill (like a publication for scientist), because no American citizen would defend H1-Bs. But politicians do not care about average American Joe. You have to admit that the fraction of US population that can compete for skill required H1-B position is very-very if not zero. In any way, best people will always be on top. In fact, I personally do not know any H1-B who had to go back to his country (and I know more than 20 right now), because even in the current “freezing” environment for emigrants they can get another job by being competitive and betting Americans here again.
Americans are afraid, they are scared that indians will innovate and become leaders in america in various fields. Therefore they have to invent some scheme to get rid of people born in asia.If the mexians and the aborignies who lived in north america had the power to get rid of Americans who landed her, most Americans won’t be here.Very few people understand and are going to accept reality.
Get rid of all H1B visa holders ship em back to their own country. We don’t need them here. They are stealing jobs from hard working American’s Their talent pool is not stronger than ours. They just have cheaper educational system which allows any one to obtain a degree. I was laid off from T-Mobile while they keep on several H1B visa holders in place!! It’s not far, some one needs to go after these companies. It’s wrong what they are doing!
H1B program has been and is still being abused. A close inspection of LCAs filed shows over 1,200,000 certified for years 2006 and 2007 and 2008. And don’t tell me that a certified LCA does not mean anything because there’s a yearly quota limit of 75,000 for H1B because this quota is also bull…
Check out the real figures published by the US Immigration itself.
Temporary workers in specialty occupations (H1B) 302,421 (1999) 355,605 (2000) 384,191 (2001) 370,490 (2002) 360,498 (2003) 386,821 (2004) 407,418 (2005) 431,853 (2006) 461,730 (2007) 409,619 (2008)
If you don’t believe it, go to this link : http://www.dhs.gov/files/statistics/publications/YrBk08NI.shtm and download Table 25.
then match it with the number of certified LCAs. Go to this link : http://www.flcdatacenter.com/CaseH1B.aspx
and download the tables for 2006, 2007 and 2008
Compare the number of certified LCAs to the number of H1B visas issued. Do you all now see the similarities? OVER 1,200,000 H1B visas issued from 2006 till 2008. NOTE that a H1B visa is good for 3 years !
Is US companies enforced the TARP rule? I did not read anything like this in any web sites.
I got laid off by the biggest Health Care Company (Big Blue) in Texas. They let me, an American born citizen who served in the U.S Military go, while keepin a Russian, A Canadian, and several Indian workers who were non-American citizens on the payroll. These companies do this all the time because they can get away with it. Other American Citizens are afraid to speak up else they will be out of a job. Also, these companies have pretty much cut their training expenses to zero so the companies can use that money to show a higher profit so the greedy managers can put a huge bonus in their pockets at the end of each year. Why spend on training when you can get workers trained in India. The greedy managers are un-American and are doing things to help destroy America. I know we are not as smart and not as hard workers as these people. Try blowing some more smoke up my rear-end!