I thought that the USA was highly in favour of Free Trade in every form?
But I guess not less expensive skilled workers invading their home turf.
As usual, it's the hypocrisy that's the annoyance to those not directly involved.
India has complained to the World Trade Organisation (WTO) about the United States' decision to increase visa application fees. The USA last year doubled the fee required to apply for an H1-B visa, a class of temporary visa for skilled workers. Fees rose to US4,000 per application. Indian technology companies have complained …
Nah... not about free trade.. the government wants a piece of the action and a cut for this. I doubt the processing costs have doubled so they're following the lead set by business... increasing income without increasing cost.
American corporations and their puppets in elected offices maybe. The average American worker and consumer, not so much. The American tech worker gets screwed because they're laid off or simply not hired (while the people laying them off complain they can't find anyone so they need to get people from overseas). The consumer gets screwed when a company like Target finds its customer information leaked because the H1B worker they hired got his degree from a mill and/or cheated on the certification and writes code as well as I did just getting out of high school. They'll probably keep him on too, because management sees all IT people as interchangeable.
I think most average Americans are at least dimly aware of this kind of corruption going on with any free trade or open border agreement. It's never to the advantage of the American worker or consumer, just the major multinationals. The Washington Post ran an article a while ago containing a quote from a congressional representative about free trade and visa expansion. He patted himself on the back because he supported the bill, calling it an act of courage as nearly 90% of his constituents were against it. That's the kind of gulf that exists here between the citizens and government.
I think it's pretty clear that there are a few things that are routinely ignored about free trade +/- globalisation (speaking in generalisations). The first is that overall, it is good (as in it increases economic activity). The second is that this good is very variably spread - some winners, some losers. The losers tend to be workers. Winners tend to be richer. The third feature is that it is not an essential or necessary part of our world, but one created by humans. We can, therefore, dismantle it. Or alter it in any way we see fit, to achieve goals that we wish to.
Therefore, I suggest that globalisation and free trade should be encouraged, with the benefits from such activity being broadly shared by redistributive government policy.
These suggestions are of course anathema to most politicians, as at least one of the above suggestions is ideologically unacceptable to them (and their funders).
"dumping" is against free trade.
But US made the wrong move. They should have ruled illegal, and fined heavily, any wage discrimination. Thus company would have been free to hire whoever they liked. Just, they would have to pay them the same regardless where they are from, gender, etc. - as it should be the right way - pay for skills.
I'm sure the request for visa would plummet - and who could be in favour of discrimination, publicly? But of course too many companies are actually in favour of discrimination, because they want to pay the same skills less as soon as they could - up to creating cartels to ensure skilled people are paid less.
Nice idea and probably part of the solution but the great thing about imported labour is that it is much more exploitable than natives. For their equal wages (after expenses & stoppages) the staff will be expected to work 16 hour days.
"But US made the wrong move. They should have ruled illegal, and fined heavily, any wage discrimination. Thus company would have been free to hire whoever they liked. Just, they would have to pay them the same regardless where they are from, gender, etc. - as it should be the right way - pay for skills."
Exactly right - and even then, with equal wages, there would still be massive advantages to the imported worker since they can't work for anyone else in their 3-6 year tenure and you can work them long/hard hours without time off. But you're right that demand would shrink to nothing for them if pay was required to be equal (not the hand-waving "prevailing wage" non-standard that exists today, where a comparable Indian gets 65% of what an American would get doing the same job).
This whole program assumes that Indian IT-related degree graduates are the equivalent of US graduates, but they aren't. Studies I've seen indicate that Indians only attend 3 years for a bachelor's degree, and that their graduates barely compete with US high school diploma holders. Only their top tier institutions like IIT (which graduate a tiny minority of Indian college grads) are competitive with even the average US IT worker. So the idea that companies can get equal talent to what they can find in the US is wishful thinking. As you noted above, if they weren't cheap and easily controlled they wouldn't be seeking them; they'd let the labor market within the US adjust wages and attract more talent where it's needed.
"Studies I've seen indicate that Indians only attend 3 years for a bachelor's degree, and that their graduates barely compete with US high school diploma holders. "
The Rest-of-the-World doesn't rate US bachelors degrees very highly and normally want a Master's from US candidates to make up for this perceived deficit. Just so you know ...
"The Rest-of-the-World doesn't rate US bachelors degrees very highly and normally want a Master's from US candidates to make up for this perceived deficit. Just so you know ..."
What's your basis for that? The US has some of the best universities in the world and the number of foreigners attending them seems to contradict your statement.
Who ever claimed that every person in America is for "free trade" (a euphemism for somebody is losing something, and that somebody will always be the one who has something to lose")? We are not - we are for FAIR trade. And allowing US companies to import what is little better than indentured servants who remove jobs from US citizens and undercut wages (driving down all wages) isn't a workable scenario. It's done a ton of damage already, made our unemployment and social safety net issues worse and contributed to the housing crisis, driven down home prices (as people lose their jobs or income and lose their homes; floods the market with cheap(er) foreclosed homes). The H-1B and L-1 visa programs should never have been started; they were begging to be corrupted with their vague rules and language. If employers need skills like they claim then pay the wage the US labor market demands for it.
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I think El Reg has seriously not done it's research here. The Modi quote, if he really did say that (I didn't check), surely refers to the $4500 charge for an L1 application listed here:
So that's non-permanent residents working in the US where more than 50% of its US based workforce is composed of said residents.
Com'on El Reg! You don't do an *immigrant* (H) visa when you want to use your employees in the US; you aren't paying to have them jump ship, are you? Duh.
Indian technology companies have complained long and loud about the cost of H1-B visas, arguing that they need to bring workers from India to the USA to grow their businesses. US businesses retort that Indian companies could hire locals with comparable skills, but prefer to import people who they pay lower wages.
So India complains that they need to put workers in US companies that need to "grow". And the US says the Indians could hire local US residents. Hmm... maybe the US companies ought to just cut out the middle man and hire workers from the US? Oh wait.. still cheaper to import... profit... all that.
You want to hear them scream.
Put the price back to the original price but cut the quota on the existing visa.
Then, create an entirely new class of visa with slightly different conditions (available for 6 month longer stays possibly) but price it at a much higher price point and make its quota the number that were cut out of the original visa program quota. Then steadily phase out the original visas as the existing visas expire (and decrease the quota so they can't be "renewed") and increase the quota for the "new" visas.
So, India openly considers trading in people to be kosher? I guess it is good to know where we really stand on this one. In any case, I thought Abraham Lincoln did away with the idea of "people as goods" a while back.
In any case 4000 is not enough. The way H1B (and similar programmes in other countries) is formulated it postulates the same salary for the import as the local. This does not reflect the real cost of the local vs import. You nearly always end up with additional retention costs for locally hired staff - you have to raise their salary and run salary reviews, you have to provide bonuses, share options, etc. That in IT accounts for ~ 50K of employer costs per retainable head. At least.
So frankly, the cost of the work permit should not go down. It should go UP. To 50K or thereabouts so that only qualified staff which is worth it is imported on work permit programmes.
"This does not reflect the real cost of the local vs import. You nearly always end up with additional retention costs for locally hired staff - you have to raise their salary and run salary reviews, you have to provide bonuses, share options, etc. That in IT accounts for ~ 50K of employer costs per retainable head. At least.
So frankly, the cost of the work permit should not go down. It should go UP. To 50K or thereabouts so that only qualified staff which is worth it is imported on work permit programmes."
I think there are two easy fixes for the H-1B problem:
1) Don't use the H-1B - simply give each qualified immigrant that's request an instant green card. With that green card they can shop for an employer like any native can during their 6 year tenure. That means employers can no longer lord their status over them, pay them chump wages, or abuse them in terms of hours and time off. The desire for H-1Bs would shrivel overnight.
2) Pay all H-1Bs a minimum of $100,000 - if these people are as skilled as employers claim (they aren't) then this shouldn't be a problem and would prevent the import of these workers from depressing wages (although if utilizied it would still add to unemployment/underemployment of US workers). But if this were done I predict the number of H-1Bs would be nearly zero.
Then India and all developing countries should charge a special inward duty on all imports from the Western world, say 50,000%. This is fair considering your $ 50 k rant rant.
Come and make it here, avoid that 50,000% duty. Of course your local jobs are vaporised, which you o not like.
When it comes to importing your stuff, you want very low tariffs, when it comes to importing others skills, you want a Communist level safeguard to your wares.
"Best thing I did was bring the tech jobs back to the UK, after the previous clown outsourced them."
The "advantage" being that you can start from a clean sheet and aren't required to rehire those laid off for the outsourcing.
Outsourcing does have its uses (getting rid of moribund departments so you can start over) but it's still a fairly nasty thing.
Who else does this impact on?
Imports from other countries are really (not fraudulently) based on qualification and business need and quite often fit L and M visas instead of H1B anyway. The costs incurred by companies for people relocated under that heading are so high that a one off 4k is practically pocket change. You usually pay more than an order of magnitude more than that for all the expenses around relocation.
"How long does a US visa last for?"
The H-1B is a 3 year visa with one renewal, for a total of 6 years. Then the worker is eligible, with employer sponsoring, to apply for permanent residence (green card). But guess how many employers sponsor a green card vs simply kick their butts back to India? Almost none.
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Rather than increasing the visa fees, they should simply unlink the visa from specific jobs. Then the visa holder can work wherever they like within the life of the visa, but must have a sponsor during the initial application and renewal. This would restore a semblance of equality to salary negotiation, and allow locals to compete on a more even footing.
Some years ago, I interviewed with a New York transportation agency for an engineering position. It was a very strange interview, with the interviewer doing everything he could to discourage me from applying for work there; it quickly became obvious the reason for the interview was not that they thought me a good candidate, but that they had to reject a certain number of applicants in order to be allowed to bring in the Japanese engineer a seller of railcars insisted be included in the deal.
That is extremely common in the USA as well. The H-1B requires that employers have made a good faith effort to find a US applicant first before getting their H-1B. But the employers simply game the system so they can't or won't find a US person willing and able to do the job. They post ads in places no one looks, or with impossible requirements that will disqualify any US applicant. If some applicant does make it to an interview they look for any reason to disqualify them. In fact here's a video of a legal seminar being given to companies on how to AVOID finding a qualified and interested US applicant, so they can get their cheap laborer. If this doesn't show that the H-1B program is nothing about finding hard-to-find skills and is simply a cheap labor avenue I don't know what does.
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I'm from India( US citizen) and don't support US exporting jobs out of country. American companies are responsible for sending American jobs abroad. Let's call it like it is. We are being screwed by our own people. We don't need to cast shadows to other countries. India can howl about fee increases, however they do it also.
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