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by whatever_dude 3431 days ago
The H1B as it is has many problems, but a big salary floor is not the way to go in my opinion. Remember H1B is not just for tech workers. If you want to hire, say, an interpreter of a specific foreign language to work on a community in rural Alabama temporarily, a $100,000 minimum wage would be absurd.

They instead need to go after the companies that learned to game the system. I'm not sure what the solution is here. A point/demand-based system like other countries have is probably wise, but given the share of mind the US still has in potential emigrants worldwide, and the breadth of different positions available, it'd be a pretty complex (and likely unfair) one.

19 comments

> If you want to hire, say, an interpreter of a specific foreign language to work on a community in rural Alabama temporarily, a $100,000 minimum wage would be absurd.

Wow, that's a really important point. I'm so in the tech-news bubble that I'd never heard anybody say that before - thanks for pointing that out!

I disagree. If you are not willing to pay 100k then finding someone is not the problem. You just don't want to pay market rates.

The point of H-1B is when salary is not the problem.

PS: Remember, someone on an H-1B can leave your employment. Paying market rates is supposed to keep that from happening, thus the intent is to remove a shortage not lower pay.

What is the market rate of a translator for an uncommon language in Alabama? Where are you getting your data that suggests $100k is not dramatically above market rates for any job where there is a lack of domestic talent and a surplus of foreign talent?

Median personal income in the US is $30k, so I don't think it's fair to assume every job is like tech and has market rates in anywhere near the same place.

Are there people in the US who know the language and are not willing to move to Alabama for 95k? Then the market has spoken.

The entire point of capitalism is not everyone get's what they want and price how that is decided.

Okay, that's fine as long as they are available and willing to move for something like $100,000. Doesn't have to be super close; requiring $100,000 to hire a foreign citizen when the market wage is $75,000 seems pretty reasonable to me.

But you don't appear to have data to back up that particular number for all jobs with no specialization whatsoever, and as far as I can tell the administration doesn't either.

Let's suppose you want someone to just watch a parking lot which takes zero skills and I advertise for minimum wage and don't find anyone. Then you show up and say I need an H-1B, yes it's the night shift, but as unskilled labor that's a minim wage job...

That's the point of around a six figure wage floor. It prevents people from understating the requirements then bringing in a H-1B. I could just Advertise for a secretarial job, then only accept people that happen to speak Farsi.

>The entire point of capitalism is not everyone get's what they want and price how that is decided.

You mean protected capitalism - protected by artificial minimum wages put in place by government?

Remove minimum wage and people are not going to work for 1cent per hour. Further, this is a finite world, with finite resources and finite people. Not every business is viable even without an enforced minimum wage.
The thing is that this is a problem caused by government regulations interfering with supply and demand. If there is a business that's willing to pay for a worker and worker willing to take the job then it should be good for the economy for that match to happen. However, in this case immigration regulations sometimes make the supply lower than the demand. Sure, that makes the price go up and that's good for workers but if there aren't enough workers to go around that's bad for American business.
You are assuming that immigration has no externalized costs; I think it's pretty clear that it does. While I will certainly agree that the actual design of our immigration system is far from optimal in dealing with them, the idea that unregulated immigration so long as employer and employee find mutual benefit is desirable as that mutual benefit internal to the transaction implies total net benefit to society is, IMO, deeply flawed.
Companies are free to higher Canadian workers in Canida etc.

You can even get an Indian worker in Mexico and import the results free of charge. But, limiting immigration is one of the fundamental functions of government, and it's not going away any time soon.

PS: I also somehow doubt you would be OK with al qaeda corp setting up shop an then importing large number of people.

Who gives a damn about what is good for business? Businesses are (very) important only up to a certain point, until their interests start to go against the interests of the people.
This. I don't understand why some people think companies are entitled to get people for whatever wage they seem fit. If you can't afford it, tough luck. Let market forces decide what people are to be paid.
So you're argument is that it's impossible for their to be an actual shortage of US workers unless the salary exceed $100K?
Yes, in the same way as there is no shortage of Bugatti Veyron for 100k. They simply cost more than that.

We live in a capitalist society where price is how you communicate demand. Now, if you are willing to pay X times median wage in the US and still can't find people then perhaps there is an argument. But, saying you can't find people when you are not willing to go that far suggests you are not willing to pay market wages.

PS: And yes I chose an undefined X, because there is no clear point when that happens. However, a reasonable lower bound for that X is probably ~3-5.

The upper bound isn't limited by the number of dollars in circulation. The upper bound is limited by what's economically feasible. The outcome of the theoretical Alabama community college language teacher is that the language program just gets cut. The fees for a niche program wouldn't support a highly-paid faculty member.
> the language program just gets cut.

And then what? Yes, an Alabama community collage can't pay for a language teacher, that's a fairly normal problem for community collages. It does not suggest there is somehow a market failure.

PS: I think you miss understood my upper bound. I doubt people want an immigration policy based on filling any jobs that pays more than ~30k/year.

Okay, but then why do you refuse to accept multiplying X by the actual market wage for the job instead of picking a fixed number (in which I see no X)?
Because supply is influenced by price.

The supply of gold is huge if I am willing to pay above market rates. If I want a conductive metal I am going to chose something other than gold in the vast majority of cases because of price. In the case of gold the price is based on both demand and resource extraction costs.

Moving to the workforce, students pick jobs in part because of what they will pay. Over time this feedback loop combines with demand and other factors to set a clearing price for the industry. If a job pays less than 100k that's a very big sign that people are choosing to do something else because of pay not the jobs inherent difficulties.

Now what happens if you try and subsidize an industry with H1B's. Let's say you add 50% as many H1B as people working in the field for a huge effect. Well in the short term wages fall and people either find something else, but more importantly students study something else. Fast forward 20 years, the market price is a little lower but not by that much even though lots of H1B's are now doing that job' you still need to entice a lot of US workers. Meanwhile close to 1:1 with those H1B's, US students have moved into other fields.

Thus, unless you are going to have most people in an industry be H1B's trying to help out an industry shortfall with some H1B quota is not that useful and simply subsidizes an industry for minimal benefit.

PS: Even defining things based on job is tricky. I need a Doctor what's the price for that, type: surgeon, type of surgeon: cosmetic. Now a hospital that can fill out generalist one level up can get a discount. Even industry gets tricky as a school may need a doctor for example.

> suggests you are not willing to pay market wages.

Uh, or you know, you can't afford it?

That's not exclusive. I am not willing to pay for a penthouse in Manhattan, because I can't afford it. I am also not willing to pay for a live in chef, and 10,009 other things because I can't afford them. That is not a failing of society it's how capitalism allocates finite resources.
I am not the GP, and I do not agree with the statement. However, I have seen it being made numerous times: any shortage of US workers just means the companies are not paying enough (their argument being, try to pay $1mil and you will certainly fill your positions, this is just very minor exaggeration)
I see the thought process, but it's not universally true since you have to account for value the employee brings as well. Consider a company with only 1 employee. That employee can create 1 widget per year which sells for $100,000. The market for widgets is very elastic and at price points above $100,000, the demand is zero. Overhead and cost of goods is $50,000. In that case, the person's salary can't exceed $50,000 or else the company operates at a loss. Even if there is an extreme shortage of skilled workers who can do the job.
Suppose you could higher a doctor and at the end of the year get 50k in value. Is that still a viable business? Why or why not?

IMO, that's the crux of the issue. Yes, the clearing price for some jobs mean people are expensive; making some business nonviable. But, that does not inherently mean there is a shortage.

That implies that the society does not put much value in that product. Maybe there is an alternative that is better, who knows...
So then maybe it would be cheaper for the company to hire a low-skilled American worker and actually gasps train them?

The CEO of the theoretical company is always welcome to put in an extra 30 hours a week and reap the extra economic value.

Not sure what your example is trying to demonstrate; yes, there's no viable business producing a $100k widget that costs $100k in labor and $50k in goods to create (unless maybe you're VC funded).
It seems in that case market rate is a lot lower for that role. Just not a lot of Americans to fill it.
Wow. I knew the H1B category was biased towards large companies, but I didn't realize it was so bad.

The first cultural, linguistic, or otherwise geographically-constrained job in the list is #84, "Foreign Language And Literature Teachers." "Interpreters and Translators" is down at #131, with a grand total of 268 applicants - practically a rounding error after 300,000 tech applicants. Whatever_dude's example seems so appropriate, that it's shocking to see it so far down the list.

It's like anything, there's a whole ecosystem involved - which includes having a lot of money to pay the right lawyers that know how to navigate the system properly. I've seen companies hire the wrong lawyers and, after promising the individual that everything would come through, end up having to tell the person that the application was denied.
> Wow. I knew the H1B category was biased towards large companies, but I didn't realize it was so bad.

Where does that page say anything about large companies?

sounds like each job class needs it's own minimum.
Which is what the current rule - the one based on prevailing wages - tries to address. Minor tweaks to it - for e.g. using the mean of the top 1/3rd of the salaries surveyed - will accomplish what you ask for, IMO.
wonder if that shouldn't be by city since salaries very so much by geography.
The current rules determine prevailing wage per geography.
Yeah, or what about those of us in the NGO and non-profit sector who need people with specific regional skills/knowledge/experience and/or folks (including tech people) who prefer to take a slightly lower salary because they want to work with us on important stuff? We've had to sort visas on a number of occasions for people. $100,000 would be like one of the highest ever non-profit salaries!
The salary floor is when the business does not have to prove they did not first search for openings in the US. If you want to hire someone with extremely specialized skills for under 60k(or $130k as proposed by the new bill) a year you have to at least try to recruit in the US first.
Sounds like each job class needs it's own salary minimum.
If an interpreter is so rare that one can't be found in the US and they need to be hired internationally, then maybe it's worth it to pay $100,000?
Obviously we can't know what the organisation doing the hiring is like in this fictional scenario, but $100k would be a huge, huge amount for non-senior staff in rural Alabama no matter what.

The problem with a hard salary floor is that it doesn't account for differences in cost of living at all. It would very quickly become the visa of coastal cities and little else.

Then they can't afford to run. I'd also love to bring say professional 3D modellers and animators from Eastern Europe or Brazil and pay then 20k CAD/year, but thats not how reality works. All of these programs (hb1/etc...) are basically wage arbitrage schemes and have little to do with presence/absence of talent.
There is no universal H1B salary. Translators do not earn as much as developers, in general. People living in Alabama do not earn as much as those working in Silicon Valley, in general. H1B applications go through a "labor condition application" for this exact reason - the government approves the salary, based on industry and location. Therefore, you can't bring 3D developers to Silicon Valley and pay them $20k. But you might be able to bring a translator to rural Alabama.

If the aim of the H1B program was to bring in the highest possible paid workers, you'd be correct. But it isn't. These programs are designed in such a way that all states can benefit from them, and a variety of professions.

Ok, what is the aim of the H1B program? You appear to have raised that question, and then shied away from that phrasing in your answer.
If you factor in cost of living, the consulting agencies that currently abuse the system will just open up offices in cheap areas.
Not really, because quality software development generally requires teams to be in close proximity. As has been discovered by many firms, moving operations overseas is "penny wise and pound foolish"

For example, Disney of Florida replaced 250 American IT workers in US using immigrants with H1-B Visas. They in theory could have saved more money by sending that operation overseas but they chose not too.

Computer operations today are way too mission critical to most organizations to risk problems by moving tech overseas at least in operational settings.

> using immigrants with H1-B Visas

I think that's the problem here - those on H1-B visas aren't immigrants.

It is a dual intent visa and most outsourcing firms keep it strictly in the non-immigrant category.

Until they get a DoL clearance & get into an I-140 approval process, they're "temporary workers" who can be dispensed with any day.

The H1B already factors in cost of living (via the proxy of what local salaries are) and we don't see that happening all that much.
Which would in my opinion even be a good consequence.
> The problem with a hard salary floor is that it doesn't account for differences in cost of living at all. It would very quickly become the visa of coastal cities and little else.

Perhaps that's Trump's plan.

"It's worth it" only applies if a company is directly going to make a ton of money out of that person.

Not every company operates like that. I know it's hard to believe, or even comprehend, in the tech world.

> If you want to hire, say, an interpreter of a specific foreign language to work on a community in rural Alabama temporarily, a $100,000 minimum wage would be absurd.

Thats the POINT. Today it would be absurd, but a successful multipronged plan to bring both manufacturing as well as constricting supply of people with specialized skills, would raise the salary demands of the whole US population.

The H1B salary part of the system hasn't been modified since 1989. $60,000 in 1989 is equivalent to $120,000 in today's dollars. Does that influence your opinion at all?

Congress created a rationale back then, the industry merely used the tools available since then. Congress' rationale did not change, they are both adjusting for inflation as well as responding to the direction the industry actually went. The industry's adaptation is incongruent with the will of Congress.

In 1989 salary increases were still keeping up with the cost of housing. Or were still expecting to. For example. And a protectionist America really could do that again.

Why would that be absurd? A highly specialized skill in an area that we can infer is generally less desirable to live should command a higher than average wage. Much higher if the situation is so desperate that a foreign worker has to be sought.

Also: the majority (by far) of H1-B visas are for technology work. It may not technically be "tech only" but in practice it may as well be.

I think one of the Dem senators had proposed a plan that had the floor relative to the location and the job, so in this case you'd have to offer 150-200% of what an Ethiopian translator in Alabama would recieve, before you'd be allowed to hire someone via a Visa. That general principal seems reasonable to me, and less Silicon Valley centric than just a flat floor at whatever they think is reasonable for a software dev.

Though obviously a single number is less work.

No doubt that would open the door to all manner of skullduggery. Infosys then opens a new operation in West Armpit, Alabama and their employees now make 150% of the going rate for Java developers there in West Armpit. It is just a weird quirk that said employees wind up doing lots of travel...
All of a sudden TechInfoSys opens up a new branch in West Armpit to support the operations of their San Francisco main office and West Armpit is where all of the new developer/analysts are to be employed...
There's a few fixes to that too. Make the pay scaling regional or put in provisions that increase the floor based on percentage travel or where the visa job would work.
This is how laws get really complicated. Wouldn't a more complex solution end up costing more (to the companies you are trying to help) than a simple solution?
It depends on what you're trying to do. Outwardly H1-Bs are supposed to be about bringing in talent that can't be filled with a US worker which should fetch a premium. To that end having just a blanket floor doesn't really make sense because a premium wage in Small Town, USA is a rounding error to large corporations in Big Tech Hub, USA. But you can't make the sliding scale too location sensitive because then you just open a new way to game the system with having big contractor sweat boxes all operating out of the middle of North Dakota or somewhere with market so tiny prices. I don't think a simple law could ever really run H1-B if the goal is 'bring in premium talent' for hard to fill positions especially in tech positions where location is becoming less and less critical.
You realise H1B's are location specific right? All these "fixes" everyone keeps bringing up are actually a part of the law as it stands.
Floor relative to the location and the job--is very easy to abuse. You can abuse both location and job via indirection: indirection through layers of contracting companies. Similar strategy is used now to abuse: Some Mega corp contacts out to TCS, which further contracts out to some mom and pop consulting co, and so on.
> Why would that be absurd?

There's more about specialization than just the area. To stay with the example, there may be many reasons why someone would want to hire an interpreter for a given language, and for someone to be willing to do the job, without it ever making sense to pay twice what a good average living wage is on the area. The "pay higher if it's high demand" excuse is cutthroat capitalism, IMO, and ignores the fact that the employer might not actually be trying to exploit someone but actually bring something that their customer base/community needs, something they wouldn't get otherwise. It's not about being "desperate enough" to hire a foreigner - in many cases, as in certain niche skills, a foreigner might be the best option.

Also remember the H1B is supposed to be a temporary. It's classified as a non-immigrant visa. Temporary need for a foreigner also exists.

> Also: the majority (by far) of H1-B visas are for technology work. It may not technically be "tech only" but in practice it may as well be.

That's exactly my point, and it's one of the many problems with H1B. Tech workers flood the request and suddenly everyone is just thinking about a salary floor cap because tech has higher salaries than other roles. But there are other roles and businesses that could actually benefit from foreign workers, but they're all crushed by how large tech is instead.

> Also remember the H1B is supposed to be a temporary. It's classified as a non-immigrant visa

Technically, it is a "dual-intent" visa.

It's both.

> Even though the H-1B visa is a non-immigrant visa, it is one of the few temporary visa categories recognized as dual intent, meaning an H-1B holder can have legal immigration intent (apply for and obtain the green card) while still a holder of the H-1B visa

It means you can apply for immigrant status while holding an H1B. Differently from most other visas, which means you lose them automatically as soon as you apply for residency.

Have you been through rural Alabama? I suspect the point is less that it's undesirable to live there, than that a high salary for an interpreter simply isn't going to fit in the budget.

Why should Facebook's ad tech needs trump the needs of a poor refugee community? Budget size should not be the only virtue signal.

Why should refugee community's desire for a cheap interpreter trump the needs of an engineer who could make 250k at Facebook?
>an area that we can infer is generally less desirable to live

Lower cost of living does not mean the area is undesirable to live. Building adequate housing supply (I know, unheard of in the Bay, but some cities do it) can cause cost of living to stay low.

A major weakness of this policy is that it doesn't scale by regional median salary. Under exigency a company in SF could easily pay $130k to bring in a foreign worker with a needed rare skill. A company in Alabama could not.

Then require some multiple (> 1) of the average or median salary in the region.
What is a reasonable higher than average salary completely depends on the market. But you really, really need to step out of the tech bubble before thinking about wages... tech people are reeeally out of touch when it comes to what money the rest of the country has to live off of.
Many nations have special visa categories for native speakers of foreign languages working as teachers. If that's really a problem then having something like that would probably make more sense.

Usually when I here someone critique the salary floor it's in reference to poorly paid scientists or biologists, as if it's a law of nature that these people should be poorly paid.

It's not a salary floor - $130,000 would be a salary that exempts the application from from "non displacement and recruitment attestation requirements"[1].

For your example the employer could easily show a US worker was not being displaced and could not be recruited. Your example may also be exempt from the H1B numerical cap if the role is with a institution of higher education, a related or affiliated nonprofit entity, a nonprofit research organization, or a governmental research organization.

[1] https://www.dol.gov/whd/regs/compliance/FactSheet62/whdfs62Q...

If the supply of those interpreters is so limited that you have to go outside of the U.S. to find them, then doesn't supply/demand indicate that they should have a high salary?
No. Supply has a geographic component. They may be very rare in the US, but very common overseas. For example, there may not be many people currently in the United States who are fluent in Northern Kurdish, but there are millions of capable applicants available in Turkey, Syria, Iraq, and Iran. Supply will have an impact on the salary, of course. But in the absence of regulation, it will only be what the native Kurdish speaker would typically earn in their home country plus a some amount for the travel requirement.

Edit: This is how H1Bs should operate according to their stated purpose. edge17's link to http://www.myvisajobs.com/Reports/2017-H1B-Visa-Category.asp... shows that it's not being used in this way at all.

High as compared to what? Supply curves don't operate in a vacuum.
High as compared to other jobs. If the demand for programmers is "1,000" and there are "100" programmers available - how is that different from demand of "100" interpreters but supply is "10"?
If people want twice as many cars as there are, and they want twice as much toilet paper as there are rolls, do you expect rolls of toilet paper to cost as much as a car?

Supply and demand curves are (a) curves, not two points on a line (b) curves as a function of price. You can use them to pick a price, but not to come up with one from amounts of X ex nihilo. Even if we're sticking with the most primitive micro-economic theory here, you've discarded a whole dimension.

Agreed. The world is bigger than just tech. Take a look at all the other backgrounds that often get H1Bs. A big one is scientists.

If you made the floor $100K, say goodbye to non-PhD (and some PhD) scientists! And since the demand for PhDs isn't that high (you often have 2-3 non-PhDs reporting to a PhD), say goodbye to a lot of scientists using the H1B.

H1Bs are overwhelmingly used for tech: http://www.myvisajobs.com/Reports/2017-H1B-Visa-Category.asp...

That said I do agree that there should be some kind of exception for highly skilled individuals in STEM fields (I believe Japan does something like this).

We'll then PhD demand would increase for h1b applicants. You would have to argue that there's a shortage of Bio, Chem,..etc graduates in the US, which there isn't. Any foreigner who posses a high level of skill in their field, shouldn't have a problem getting a PhD either.
Just line up the incentives.

For example require the company bringing the worker in to post a bond, make it trivial for the imported worker to switch companies, and make the original company to pay the difference between what the worker's salary winds up being and what their new salary is after 2 years if they can't hold on to said worker.

If you're a company that really needs that skill, really can't hire it, and is paying above market wages, then this will not slow your hiring. But if you're trying to hire below market, it would backfire badly on you.

> They instead need to go after the companies that learned to game the system.

I'm not sure if there's a way to prevent global labor arbitrage. Multinational corporations will shift labor to countries with the lowest wages.

Perhaps they should put a multiplying factor on payroll taxes that's proportional to the total non-US labor wages paid (directly or indirectly) for producing a product. All expenses should be default considered as foreign labor-based unless proven otherwise. It would introduce a ton of paperwork initially, but then everyone will be incentivized to produce documentation showing US labor-produced products to prevent the increase in taxes.

There absolutely is: free movement of labor. Unfortunately that's the solution capitalists absolutely will not countenance, and they will happily stoke xenophobia and buy off the most reactionary elements of government in order to keep it from becoming a reality.
There should be more specific classification of the h1b job function. Example: look at the h1b data at any of the big 4 accounting firms

ex: PRICEWATERHOUSECOOPERS LLP

TAX ASSOCIATE - 200 Records, Median Salary $56,181

ASSOCIATE - 243 Records, Median Salary $53,000

ASSURANCE ASSOCIATE - 700 Records, Median Salary $59,000

What exactly do these associates do?

With technology today, do we need interpreters in-situ (e-mail, voice, video, etc.)? Also, as we have Americans volunteer abroad for different missions, we too can look for overseas volunteers who could contribute to help in edge-case causes like this.
It's a bigger problem that can be hardly solved by online/video interpreters.

There are many immigrant/refugee communities in the US that are in dire needs of certain services. No matter how well intended the members of that communities are, they run into many a lot of problems during integration. One I've heard about from a friend (who's a teacher) is that once their children starts going to school, because of the language difficulty and even some cultural differences, they usually fall behind and are treated as "special needs" because teachers don't want to deal with them. This creates a vicious cycle.

They wanted to hire a teacher with knowledge of the community and the language, to serve as much as a liaison as to make the community more comfortable. They can't immediately hire anyone from the community because of the requirements for the job - they'd need a degree and about 2 years training. Now, he knows for a fact there's capable people in the country the community came from willing to reallocate to help with integration. But they can't hire them, even as a part of any special program; the uncertainties about the visa process, its cost, and its duration make it impossible. Everybody loses.

Hear hear, it was a nightmare getting teachers for my kid's German school in SV: so much H1 uncertainty and they usually all vanished at the wrong time (i.e. all taken before the time when teachers change jobs).
I think that's an edge case that is < .01% of what the H1-B visa is used for. The problem is that 99% of H1-B is being used as most people have described, which is undercutting the market value of engineers.
I think a minimum wage of 100K for all H1-Bs may not work for all roles, it should be a certain percentage above the prevailing market wage specific to that role.
Maybe some sort of waiver would solve that within the context of the H1B? Exceptions based on regional needs or organizational focus?
I used to agree with hungrygs' response. It appears right in many ways until I put TN and E3 visa in perspective. They tuk-tuk-tur is apt.
The previous H-1B minimum wage of $60,000, which was established in 1989, is the equivalent of $117,000 in today's dollars.
What about the idea of having an auction for the H1B slots?
Maybe allow for waivers, capped at xxx a year, for these essential but not high paying jobs?