A recent surge of discussion around visas for technology workers highlighted a split among Republicans regarding immigration policy.

Steve Bannon, former chief strategist for Donald Trump, labeled the H-1B visa program as a “complete scam.” Many of Trump’s supporters shared this sentiment, as did Bernie Sanders, the progressive senator from Vermont.

Bannon’s comments were in response to billionaire Elon Musk, a business ally of Trump, who expressed strong support for H-1B visas. Musk stated on Twitter that the visa was “the reason I’m in America,” and vowed to fight fiercely for this issue, implying the intensity of his commitment.

Trump, who is slated to assume the presidency again, backed Musk, setting the stage for a possible clash in his upcoming administration.

The core of the debate revolves around a visa program aimed at allowing American companies to hire skilled workers from abroad.

Is the H-1B Visa Taking Jobs from Americans?

Proponents argue that the H-1B visa stimulates innovation and boosts the U.S. economy. Opponents contend that it results in American job losses.

Sanders has criticized the H-1B program, asserting, “Its primary goal is to reduce American workers’ wages and take advantage of foreign labor,” in an interview with YSL News.

Before diving into the arguments from both sides, let’s summarize the findings of research and data on the H-1B visa:

Research indicates that the program adversely affects some American workers, particularly in the tech sector. Studies have shown instances where employees were required to train H-1B visa holders who took over their positions. Evidence suggests that computer scientists would earn higher wages in a scenario devoid of the visa program.

However, there’s substantial evidence that the H-1B visa benefits many others. Individuals coming to the U.S. on these visas often go on to create billion-dollar enterprises. Musk himself entered America on a visa and now heads Tesla, which employs over 100,000 people.

“Ultimately, Americans are better off,” stated Gaurav Khanna, an economist from the University of California, San Diego, who is well-versed in the H-1B topic.

The visa allows companies to temporarily recruit high-skilled workers, primarily in specialized roles within the tech sector, as outlined in a recent government report. Initially granted for three years, these visas can be extended to six years, with many holders transitioning to permanent residency.

The annual cap for new visas is set at 85,000, although this limit does not affect non-profit organizations. In total, about 386,000 visas were approved or extended by the government in the fiscal year 2023.

The average salary of an H-1B worker reached $118,000, roughly double that of the average American worker.

Critics Claim Companies Exploit the H-1B Visa for Cheap Labor

Opponents argue that companies use the H-1B visa to obtain inexpensive labor from other countries.

“The program is structured to enable U.S. companies to import foreign workers to replace American employees,” stated Eric Ruark, research director at NumbersUSA, which advocates for limiting immigration. “There are qualified workers in the U.S. available for these roles.”

While an annual salary of $118,000 may seem significant, a 2020 report from the Economic Policy Institute revealed that employers tend to pay H-1B workers below local market wages, thereby undermining local salary standards.

Sanders commented, “This program allows large, often tech-oriented corporations to enhance profits by compensating foreign employees less than American workers.”

A fresh report highlighted that the top 30 H-1B employers recruited over 34,000 new visa workers in 2022, while simultaneously laying off around 85,000 employees in the same timeframe.

Critics refer to Census data indicating that just 28% of U.S. college graduates with degrees in STEM (science, technology, engineering, or math) fields work in STEM occupations.

Also, H-1B visa holders have been found employed in roles such as dog trainers, massage therapists, and cooks, according to Sanders in a recent op-ed for Fox News.

He argued that many visa holders are treated like indentured servants, risking deportation if they speak up about poor or unsafe working conditions imposed by their employers.

Academic studies suggest that American tech workers might have slightly better economic outcomes if the H-1B visa program were eliminated. One study from 2017 estimated that U.S. computer scientists could see a wage increase of up to 5% without the visa system.

Nonetheless, Khanna noted, “Everyone else in the U.S. economy would be significantly better off because of the H-1B visa.”

Advocates Argue H-1B Visa Benefits the U.S. Economy

Proponents maintain that the H-1B visa fuels the U.S. economy positively.

David Bier, head of immigration studies at the libertarian Cato Institute, expressed, “H-1B workers contribute to U.S. workers’ well-being by boosting the production of valuable goods and services, thereby enhancing their living standards.”

The American Immigration Council, a research and advocacy group, cites five benefits of H-1B workers to the economy:

• They often possess unique skill sets that enhance the capabilities of American-born workers;
• They contribute to spending and investment within the U.S. economy;
• Businesses use the visa to expand U.S. operations instead of outsourcing or offshoring;
• Visa holders frequently establish new companies, thus growing the labor market;
• Innovations introduced by visa holders drive economic growth.

“What’s at stake is a reduction in innovation, fewer startups, and a potential increase in offshoring without the H-1B,” noted Stuart Anderson, executive director of the National Foundation for American Policy, an objective research organization.

He emphasized, “The H-1B visa remains the sole avenue for highly skilled foreigners to gain employment in the U.S.”

Though the program is not without flaws, both supporters and detractors criticize the annual limits in place. Demand for these visas often surpasses availability, leading to a lottery system for allocation.

“The lottery system does not seem to serve anyone’s interests well,” remarked Julia Gelatt, associate director at the U.S. Immigration Policy Program at the Migration Policy Institute.

The arbitrary cap of 85,000 visas “is completely random and uninformed,” added Bier from Cato.

Yet, Gelatt doubts that either Congress or the upcoming Trump administration will genuinely consider revoking this limit.

“I believe many associated with the incoming Trump administration do not recognize any inherent value in immigration,” she concluded.