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The Economic Benefits of the H-1B Program

H-1B Program

The Economic Benefits of the H-1B Program

Continually popular with foreign professionals, the H-1B visa program provides myriad benefits to both skilled workers and U.S. companies. Each year, employers in need of specific skillsets turn to the H-1B program to fill crucial vacancies. Without the workers to fill this gap, the U.S. economy could suffer, as companies typically turn to H-1B visa beneficiaries to find professionals they cannot find in America. This both diversifies and strengthens the U.S. labor force, bringing talented individuals to the country. Many stay and put down roots, improving their communities and their nation as a whole.

In this article, we will provide a basic review of the H-1B program and discuss its economic benefits. Also discussed are proposed H-1B reforms announced in November 2018 by the U.S. Citizenship and Immigration Services (USCIS). If you have questions regarding what to expect during the 2019 H-1B application season, you should contact an experienced immigration attorney as soon as possible.

About the H-1B Program

Created in 1990, the H-1B visa program provides temporary, also known as “nonimmigrant,” visas to skilled and educated foreign professionals. These professionals must work in a “specialty field” necessitating at least a bachelor’s degree (or the foreign equivalent when applicable). The most common companies that utilize the H-1B program are those in “STEM” fields – science, technology, engineering, and math. According to the American Immigration Council (AIC), roughly two-thirds of applicants hail from fields in the STEM category.

H-1B visas, once awarded, are valid for three years. This is again because H-1Bs are “nonimmigrant” visas, so they are temporary. An H-1B visa can be renewed when requested by both employer and beneficiary. An H-1B visa extension, when approved, allows beneficiaries to stay and work in the U.S. for an additional three years. After that, the visa’s time limit has been reached and it cannot be renewed. At that time, visa beneficiaries could apply for a green card if applicable.

The H-1B Application Process

Each year, H-1B visa allotment is “capped,” with the USCIS providing 65,000 standard visas and 20,000 additional “cap exemption” visas. “Cap exemption” candidates are any highly-skilled, highly-educated professionals with an advanced degree (Master’s degree or higher) from a U.S. institution. Because of their training and education, these candidates receive preference in the system via extra visas.

The H-1B application year starts on the first business day each April. The USCIS considers applicants on a “first-come, first-served” basis unless submissions surpass the annual cap within the first five business days of availability. At that point, the system turns over into a lottery. According to the AIC, this has occurred eight times between FY 2008 and FY 2019. This fact alone proves how wildly popular H-1B visas are for both U.S. companies and foreign professionals alike.

Economic Benefits

By simply reading about the H-1B visa program above, you can start to understand the profound economic impact it has on the U.S. economy and labor market. The program allows U.S. companies to fill critical vacancies, often those requiring a specific skillset, with foreign professionals eager to work and live in the U.S. Apparently, even capping the standard allotment at 65,000 annual visas robs the U.S. of crucial economic growth.

For example, according to the AIC, a report found that the 178,000 rejected H-1B visas in “computer-related fields” in 2007-2008 could have created over 200,000 jobs for U.S. born workers. Further, if the U.S. were to improve and expand the H-1B system, it could create as many as 1.3 millions jobs by 2045, improving the Gross Domestic Product (GDP) by $158 billion.[1]

To read more about specific economic benefits of H-1B visas specifically, read the American Immigration Council’s expansive report.

Immigrant Entrepreneurs

Immigrants have contributed significantly to the growth of “tech” and STEM companies across the United States. In fact, Bloomberg reports that between 1995 and 2005, over half of new businesses in Silicon Valley were begun by immigrants. This entrepreneurial streak in Silicon Valley isn’t an anomaly – across the U.S., immigrants are more likely than U.S. citizens to open small businesses. In fact, CNBC states that immigrants are twice as likely to do so than naturally-born Americans.

Cutting H-1B Program Could Hurt U.S. Economy

Many opponents of immigration, like President Donald Trump, depict the H-1B program as robbing U.S. workers of jobs or driving down wages. But, the data speak differently, and a strong influx of workers via the H-1B program can actually create jobs for U.S. born workers. And in a country where 45% of Fortune 500 companies were begun by immigrants, it seems like political leaders should be welcoming H-1B beneficiaries with open arms.

Updates to H-1B Applications & Selection Process

In November 2018, the USCIS posted an announcement regarding potential procedural changes to the H-1B program. The reforms, posted on the federal register, accepted public comment until January 2, 2019. If instated, the planned changes affect both the application process and current selection procedures.

In short, the application process would now allow employers to simply register any candidates at the start, rather than submit full applications. Employers would only complete and submit full sponsorship applications for any chosen H-1B candidates.

Additionally, the changes alter the selection process, effectively reversing the choosing order of the lottery. Currently, the lottery allots the 20,000 “cap exemption” visas to highly-educated candidates first. Any remaining “cap exemption” cap exemption candidates would then enter the standard lottery for the remaining 65,000 visas. The new procedure would flip these two, keeping all “cap exemption” applicants in the standard lottery and then considering any remaining candidates for the allocated 20,000 extra visas. The USCIS stated that it hopes this action will make the process “more meritorious.”

If you’d like to read more about the announced H-1B program reforms for a deeper understanding, you can read our December article about the updates. The article dives deeper into the reforms to help you understand the possible changes that may occur starting in April 2019.

Contact an Experienced Austin Immigration Lawyer

If you are considering sponsoring or applying for an H-1B visa this year, talk first with an experienced immigration attorney. Remember, only an attorney certified by your state’s bar association has the proper knowledge and skills to help your case. Working with an attorney is especially important for this year of H-1B applications, because it is not yet clear whether or not the USCIS will implement the announced changes. An attorney will be able to stay updated and “in-the-know” on your behalf, so that you don’t have to worry.

The lawyers at Nanthaveth & Associates passionately serve clients in Austin, Texas. We continually stay updated on government reforms and litigation so our clients receive top-tier legal counsel. If you have any immigration question or concern, sit down with us during a free initial consultation. During your meeting, you’ll work with one of our attorneys and discuss your current situation.

Sources Cited

[1] American Immigration Council. (2018, April 6). The H-1B Visa Program: A Primer on the Program and Its Impact on Jobs, Wages, and the Economy. Retreived from https://www.americanimmigrationcouncil.org