By Kriti Gupta and Md. Taraq Junaid
“My legislation refocuses the H-1B program to its original intent to seek out and find the best and brightest from around the world, and to supplement the US workforce with talented, highly paid and skilled workers who help create jobs here in America, not replace them.”
– Zoe Lofgren, Congresswoman
Standing by the motto “Buy American, Hire American”, on Monday, a new legislation was introduced in the House of Representatives, which sets the minimum wage for H1-B visa workers to as much as $130,000, more than twice the current limit of $60,000. The bill has been introduced as “The High-Skilled Integrity and Fairness Act of 2017” by California Congressman Zoe Lofgren. The legislation comes through after a few companies like Disney and SoCal Edison came under the radar for firing American workers and asking them to train immigrants to take up their jobs before they leave.
What is the H-1B visa?
[su_pullquote align=”right”]The visa used to help American countries in dealing with labour shortages in jobs that were growing rapidly.[/su_pullquote]
The H-1B visa is a non-immigrant visa in the US under the Immigration and Nationality Act, first introduced by George W Bush in 1990. It allows US employers to temporarily employ foreign workers in skilled occupations, majorly in the IT sector. The visa used to help American countries in dealing with labour shortages in jobs that were growing rapidly.
Repercussions
The program offers a market-based solution that gives priority to those companies willing to pay the most. This ensures that the American employers have access to the talent they need while removing incentives for companies to undercut American wages and outsource jobs.
The reform of H1-B visa program will force tech companies, which depended on relatively-cheap outside labour, to hire locals.
The USA issues about 65,000 H1-B visas every year and almost two-thir, ds of the visa applicants are Indian nationals working for Indian IT companies such as Wipro, Infosys, and Tata Consultancy Services (TCS) or foreign I.T companies such as Google, Microsoft, and Accenture.
“This is a significant blow to the Indian IT sector. There will be ramifications of it from both the US and India. This bill should ideally have been backed by the aspect of the availability of skills as well and not only increasing the minimum wage,” said Sanchit Gogia, chief executive of Greyhound Research.
However, there is no mention of any basic skill set that is required for receiving the H-1B visa and this could be an issue for low-wage companies operating in different regions. While companies that could still afford to go the extra mile to hire foreign workers for engineering related jobs, small companies operating in different locations will suffer huge losses.
Does America stand benefitted?
[su_pullquote align=”right”]By 2018, there will be more than one million IT jobs lying vacant in the US and there will be no candidates.[/su_pullquote]
While the Trump administration defends its actions in the name of American-public welfare, NASSCOM, the trade association of Indian I.T. and Business Process Outsourcing Industry, has argued that the policy will have an adverse effect on American economy which faces severe talent shortage. “By 2018, there will be more than one million IT jobs lying vacant in the US and there will be no candidates. Apart from the shortage in the available workforce, even in the universities, more than the 50% of the enrolment in the STEM program are foreign nationals. Even if you need to employ these foreign nationals, you need to have H-1B visa program”, said R Chandrashekhar, President of NASSCOM.
R. Chandrashekhar, President of NASSCOM has predicted talent shortage | Photo Courtesy: Live MintShaky ground
The bill though can bring about good news for the American workers, it will have long drawn ramifications on the US economy and its relations with the growing global industries. Although there is no guarantee the legislation will be passed, it has surely managed to create ripples around the world. Looks like Mr. Trump will deliver on his campaign promises much earlier than expected!
Featured Image Credits: Reuters Media
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