Buy American, Hire American: Saving American Jobs?

Buy American, Hire American: Saving American Jobs?

How Expanding Visa Access Can Help Close Workforce Gaps
By Dana Rifai, Partner, Burke Constanza & Carberry LLP

Dana Rifai

Whether it be the rural Indiana engineering firm desperate to fill a gap in its employee pool or the inner-city hospital vitally needing a specialist to complement its physician staff or even the country school seeking a language teacher to broaden its students’ horizons, my business clients have employment needs that must be met. Employers require an outlet to hire any person who fits the job description regardless of their nationality, particularly when efforts to hire a U.S. worker have gone unfulfilled.

But there is a great deal of skepticism and fear about immigration laws today. In my line of work, the fear stems from losing U.S. jobs to immigrants thereby supporting the notion that immigration laws must be tightened to protect jobs.

President Trump signed an Executive Order entitled “Buy American, Hire American” on April 18, 2017. The stated purpose of the order is to create higher wages and employment rates for U.S. workers and to protect their economic interests by rigorously enforcing and administering the laws governing the entry of foreign workers into the U.S. The executive order calls upon the Secretaries of State, Labor and Homeland Security, and the Attorney General to propose new rules and issue new guidance to protect the interests of U.S. workers in the administration of the immigration system. In particular, the order suggests reforms to the H-1B visa program to help ensure these work visas are awarded to the most-skilled and highest-paid beneficiaries.

Even though some hold the outlook that immigrants fill sought-after American jobs, the truth of the matter is that most immigrants do not take away the jobs of Americans. Here is why.

The H-1B temporary work visa provides U.S. employers a mechanism to temporarily hire foreign professionals to fill gaps in their workforce. A statutory limit of 65,000 visas are available each year for new hires and an additional 20,000 visas for foreign professionals who graduated with a master’s degree or doctorate from a U.S. university. In recent years, the demand for H-1B visa numbers has far exceeded the annual supply. Employers apply to United States Citizenship and Immigration Services (USCIS) for these visas every April 1st. Over the past several years, the number of H-1B applications hovers around 200,000. USCIS conducts a random lottery to choose which applications will be processed; keep in mind, selection in the lottery does not guarantee approval.

About two-thirds of H-1B visa requests are for occupations in the fields of science, technology, engineering and math (STEM) according to government data. Many sources will attest that today’s labor market lacks workers in the STEM fields, which foreign nationals can help fill. The Bureau of Labor Statistics provide that unemployment rates are low for occupations that use a large number of H-1B visas. Namely, many STEM occupations have very low unemployment compared to the overall national average indicating a demand for labor in those fields. Business supporters of the H-1B program admit it hinders their taking jobs outside of the U.S. where gaps in the workforce can be filled with less bureaucracy.

The American Immigration Council (AIC) projects that skilled foreign professionals’ contributions to the U.S. economy help create new jobs and new opportunities for economic expansion. Their research indicates that an increase in H-1B visas could create 1.3 million new jobs around $158 billion Gross Domestic Product in the U.S. 2045. Had the U.S. government not rejected H-1B visa petitions in computer related fields in 2007 and 2008 (due to the overflow beyond the statutory annual limit), U.S. metropolitan areas could have created as many as 231,224 tech jobs for U.S.-born workers in the two years that followed.

The AIC further finds that from 2009 to 2011 wage growth for U.S.-born workers with at least a bachelor’s degree was nominal, but wage growth for workers in occupations with large numbers of H-1B petitions was substantially higher.

Practically speaking, employers invest business capital to petition for an H-1B visa for a potential foreign worker. The normal cost of legal fees and immigration fees are thousands of dollars, which the employer is required to pay. The H-1B costs cannot be recouped from the foreign worker. The employer must make attestations to the U.S. government that the employer will pay the foreign worker above the average wage the job position attracts in the geographical area it is located. The employer must further remain in compliance with the multitude of immigration and employment laws related to H-1B workers. Such an investment must be worthwhile to the employer. In my experience an employer will not take on this feat unless truly necessary to the prosperity of the employer’s business.

Foreign-born workers comprise nearly 17% of the U.S. labor force according to Quartz news website. The American Immigration Lawyers Association contends that our nation benefits when U.S. companies are able to hire and retain global talent to help foster the robust growth necessary to keep our economy thriving and to maintain jobs in the U.S. When employers gain the ability to broaden their candidate search, we’re likely to see significant opportunities develop for all.

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Category Features, Rule of Law