Disclaimer: This post represents my personal views on a strongly controversial topic. First, my employer, Sun Microsystems cannot be held responsible for whatever I have mentioned here. Second, this post is mainly influenced by the letter from the Senators available in the open domain and any dispute to the post should not be addressed to me. I will make sure that I will update this post if and only if I know about the response given by these companies to the letter.
On May 16, two US Senators, Charles E. Grassley (Republician) and Richard J. Durbin (Democrat) questioned about the suspected misuse of H1B visas by the outsourcing firms (mainly Indian) like Infosys, TCS, Wipro, Patni, etc. H1B visas are mainly intended to improve the competitiveness in the workforce and they should be used when there is no US workforce available to fill those vacancies. However, it is evident that the outsourcing companies use this visa for a different purpose. They mainly use this visa to facilitate the outsourcing of jobs from US to offshore. This really is a genuine concern and the outsourcing companies are bound to answer this.
The H1B visa holders from such companies are mostly posted on the client site and there is a major complaint that they receive lesser than the prevailing wages. Also the employer is not trying to fill the position using US workforce before they try to hire a H1B candidate for that. This should never be entertained because of the fact that it doesn’t really to any value add to the competitiveness of the workforce. When there is a lot of requests coming in from companies like Microsoft to increase the H1B quota, it appears that 20000 (around 30%) of H1B visas are used by the top 9 Indian outsourcing firms. If one adds the number from US outsourcing firms who have major presence in India(like Accenture and CTS), the count is going to be still higher.
Here is the letter issued by the Senators to Infosys.
May 14, 2007
Mr. Nanden M. Nilekani
Chief Executive Officer
Infosys Technologies Limited
6607 Kaiser Drive
Fremont, California 94555Dear Mr. Nilekani:
As members of the Senate Judiciary Committee Subcommittee on Immigration, Border Security and Refugees, we have a responsibility to oversee and evaluate our country’s visa policies. We have been concerned about reported fraud and abuse of the H-1B and L visa programs, and their impact on American workers. We are also concerned that the program is not being used as Congress intended.
While some Members of Congress have focused on increasing the annual cap of the H-1B program, we believe it is important to understand how H-1B visas are being used by companies in the United States. We have received helpful data from the U.S. Citizenship and Immigration Service with regard to H-1B visa approvals in 2006 for the top 200 participating companies. Your company was one of the top companies on the list. Therefore, we are requesting your cooperation in providing additional statistics and information on your use of H-1B visa workers.
First, some groups, such as the Programmers Guild, have analyzed the wages paid to H-1B visa holders. They have found that the average annual salary of foreign workers is significantly lower than that of new U.S. graduates.
Second, a number of consulting firms reportedly recruit foreign workers and then outsource the individuals to other job sites or companies. Many of the top 20 companies that used H-1B visas in 2006 are firms, such as yours, that specialize in offshore outsourcing.
Third, a number of firms have allegedly laid off American workers while continuing to employ H-1B visa holders. The American people are concerned about such lay offs at a time when the demand for visa issuances and the recruitment of foreign workers appear to be increasing.
Because of these concerns, we seek your cooperation in answering the following questions:
NUMBERS
How many United States citizens do you employ in the United States?
Is your company an H-1B dependent employer?
How many visa petitions did you submit to the Citizenship and Immigration Service for Fiscal Year 2007?
Of the total number of petitions requested, how many have been approved for Fiscal Year 2007, if known?
How many H-1B visa holders is your company currently employing? What percentage of your total workforce are H-1B visa holders?
What is the average age of the H-1B visa holders that your company currently employs?
What is the average number of years of experience of your employed H-1B visa holders?
Please describe your efforts to recruit Americans for the positions for which you employ H-1B workers.
WAGES
What is the average wage of your company’s H-1B visa holders? What is the median wage? What is the highest and the lowest salaries for those H-1B visa holders currently employed by your company?
What is the average wage of your company’s workers who are United States citizens in the same occupations?
OUTSOURCING
Of the 4,908 visas your company received in 2006, how many of those workers are currently employed and paid by Infosys Technologies Limited?
Of the 4,908 visas your company received in 2006, how many were outsourced to other companies and how many employees’ salaries were paid for by a firm other than Infosys Technologies Limited?
LAYOFFS
Has your company experienced any layoffs in the United States in the past year? Any layoffs in 2005? If so, how many people lost their jobs?
If your company has laid off workers in the United States, what job positions were part of that layoff?
If your company has laid off workers in the United States, how many of those workers were H-1B visa holders?
If your company has laid off workers in the United States, did any H-1B visa holders replace those dislocated workers, or take over any of the laid off employee’s job responsibilities?
We appreciate your cooperation, and respectfully request that you respond to our questions no later than May 29, 2007.
Sincerely,
Charles E. Grassley
United States SenatorRichard J. Durbin
United States Senator
Looks like none of the companies are in mood to provide the facts or any justification. I saw someone calling it as a vote bank politics (US election). Well, I am not interested in excuses. If they are not doing wrong, why not the facts?!
>The H1B visa holders from such companies are mostly posted on the client site and there is a major complaint that they receive lesser than the prevailing wages. Also the employer is not trying to fill the position using US workforce before they try to hire a H1B candidate for that. This should never be entertained because of the fact that it doesn’t really to any value add to the competitiveness of the workforce.
This concept completely goes wrong when you consider the actual meaning of “competitiveness of the workforce” from the perspective of service companies. You are considering only the skill of the employees when you mean “competitiveness among workforce”. The actual truth is “You dont need to be a macho-man to become the best in an outsourcing firm. Its enough if you are an average English speaking and an average software skilled person because you dont need to use much of your brains actually”. This is applicable to 99% of the projects. This is the main reason that these firms are ready to heap-in with students from campus placements though they are from a DABBA college. So in no ways, these outsourcing firms create competitiveness among workforce. Only your company like Sun Microsystems might instill competitiveness among workforce by encouraging to use their more-than-available brains and interviewing 50 candidates to fill in ONE single software programmer position.
By telling all this, I’m trying to prove that an (average) skilled person is more than enough to fill in a software programmer position in a service firm. Now come to the service company’s point of view. To choose such an (average) skilled person for a client side requirement, do you think that they should go for an Indian SE or native US SE? Obviously, the US SE demands more package than the Indian SE which is a global fact. So, by default they go for an Indian SE to fill in such a requirement because he is more than enough to fit for such a position. Why to loose more money from your pocket unnecessarily with a US SE?
Consider a simple day-to-day scenario of me. When I go out for purchasing a mango, will I approach the shop which is charging me more or to the shop which charges less? (Note: Quality of the mangoes from both the shops are good. Assume that the mangoes which are of high price are even more tastier than the ones which are priced less.) As my requirement is to get tasty mangoes at a cheap price and not the tastiest mangoes at a high price, I go for the ones which are priced less. I wont be willing to spend time to bargain with the high-pricing shopkeeper to bring down the price of those tastiest mangoes (Anyways, he wont bring the price so much down to level it against those tastier mangoes). Again, When I goto purchase mangoes on the next day, I will directly goto the shop which provides the tastier mangoes at a cheap price. I will not even try to sniff near the shop which sells tastiest mangoes at a high price.
This is the case with an Indian SE and US SE when it comes to filling a software position in US. 95% of the Indian SE’s who are sent onsite are the tastier mangoes available at a cheap price. US SE’s can be assumed as those tastiest mangoes which come for a huge price.
This is why our indian service companies’ go for an Indian SE by default instead of an US SE. This is how they are saving huge money and this is one of the hows, they are able to show a mammoth profit every quarter. They are using this money to expand their business and stand affront of all. So, I want to conclude this argument by telling that “When you talk about service companies, consider “COMPETITIVENESS IN THE SERVICE MARKET BY CUTTING DOWN THE OPERATING COSTS” instead of considering “competitiveness of workforce”. If you think in that way, then you will always prefer a H1B holding Indian SE instead of an US SE.
wats the issue n allowing ppl to work in any country they like.. crap visa stuff…!!!
and update my new blog n ur blog roll.. its stil showing my blogspot blog..!
For the sake of argument let us agree that the Indian H1B workers are underpaid. How is this different from China producing cheaper goods and supplying it throughout the world? That also leads to loss of jobs etc… Why should US tech. workers be given special protection under what is simply globalisation at work ?
There is a difference between China producing cheap goods and Indians offering cheap labor. China is producing cheap goods from their country, whereas Indians go to the US and provide cheap labor. Nobody is going to question if the service is rendered from India for whatever salary.
If visa is not required, then it favors the anti-social elements more than it does the working community. I am not talking about any single country in particular.