Foreigners taking jobs? Data shows drop in work visas doesn't benefit Americans: Report

Representative Image

Americans did not benefit from the drop in H-1B visas issued over the past two years, according to a study by the National Foundation for American Policy (NFAP).

The report—The impact of the COVID-19 drop in international migration on the US labor market—looked at the steep drop in visa issuances due to the COVID-19 pandemic.

“The Covid-19 pandemic resulted in a sharp drop in international migration to the US, but there is no evidence the entry of fewer foreign workers on temporary visas improved outcomes for US workers,” said Madeline Zavodny, an economics professor at the University of North Florida, a former economist at the Federal Reserve Bank of Atlanta, and research fellow for the NFAP.

The US government data shows that H-1B speciality occupation visas issued dropped to under 62,000 in FY21 and 125,000 in FY20, compared to 190,000 in FY19. A majority 70 percent of these visas are issued to Indians who occupy high-skilled job roles in technology and IT services companies.

The number of J-1 exchange visitor visas fell to 350,000 each fiscal to around 100,000 in FY20 and FY21. H-2B non-agricultural worker visas also fell by almost 50 percent in FY20 before returning to the near pre-pandemic level in FY 2021.

Two visa lotteries were held in FY21 as the country did not receive enough applications for its mandated 85,000 new visas quota.

Data points

Data looked at included employment, unemployment and jobs posting data for H-2B, J-1 and H-1B visa programmes. H-1B visas are for non-agricultural seasonal workers, H-2B for high-skilled foreign nationals and J-1 for summer work travel.

Considering multiple temporary visas, the study found that the US received 630,000 working-age migrants between mid-March 2020 and mid-March 2021, compared to the peak in FY15.

“The research examined labor markets where more temporary foreign workers were employed prior to the pandemic and found the drop in H-2B program admissions did not boost labor market opportunities for US workers but rather, if anything, worsened them," Zavodny said in the report.

The results also do not indicate gains for similar US workers in labour markets that had relied more on the H-1B and J-1 visa programs.

"There is no evidence of improved labor market opportunities for US workers in the leisure and hospitality sector during the summer months as a result of the virtual shutdown of the J-1 Summer Work Travel program,” she said.

No evidence of benefit to US workers

Openings due to scarcity of temporary high-skilled workers did not pass on to American workers with similar qualifications, pointing to the US labour market’s reliance on temporary foreign workers, The Economic Times said.

Opponents of the H-1B visa programme claim it “takes away opportunities” from local workers and allows companies to hire foreigners for cheaper pay. However, a lack of local hiring in the absence of temporary foreign workers due to the requirement of certain skills, validates corporate’s reasoning that H-1B visas are required to meet their demand for high-skill labour.

Zavodny said that there was “no evidence of faster employment growth or lower unemployment rates for college graduate US natives as a result of decreased admissions via the H-1B program”.

“The large drop in new temporary foreign workers via the H-1B program thus does not appear to have led to better labour market outcomes for the US natives who might compete with those workers for jobs,” Zavodny said.

The study found that labour markets more reliant on H-1B temporary foreign workers before the coronavirus outbreak had more unfilled jobs during the pandemic.

The report also noted that there was no improvement in employment for US natives with at least a bachelor’s degree in markets reliant on the H-1B workers.

“The ongoing shortages of workers in many labour markets reflect US employers’ need for additional workers from both domestic sources and abroad,” Zavodny said.