In my experience. there are two types of companies that use H1-Bs. There are companies that really do use H1-Bs as a means to hire people for positions they can’t find, and there are companies that exploit it bring people overseas over and pay them substandard wages.
I personally have not seen many companies exploiting the H1-B programs as a means of bring cheap labor and bring people with questionable talent, but that’s because I typically work at big companies that don’t use 3rd party consulting companies/contractors. Where I have been learning from others is this sort of abuse/exploitation occurs is in the consulting/contracting business, particularly for skills/technology that have already reached saturation. So, for example, I can see this happening for probably contracting positions in enterprise software for things like J2EE or database development, but have not particularly seen this for the wireless connectivity business I am in.
In the past, when we were on a hiring spree, we went to UCSD, San Diego State, and SDSU to recruit new hires, and we interviewed people equally both with H1-B and without. For the most part, we did try to hire people that didn’t have an H1-B because it was a pain in the ass to deal with all the logistics with sponsoring someone. BUT, what ended up happening was most of the masters students in CS/EE are H1-B. Out of the ones that weren’t H1-B, the really good ones weren’t interested in working for us because they had offers from Facebook, Google, Apple, etc, despite our compensation being competitive. And the ones that were interested really lacked basic fundamentals, and were the same oens that no one else wanted to hire too.
So we did end up picking up 3 people. 1 person had a bachelor’s degree and was a US citizen that was really good. And 2 people that were masters students that previously worked for 1 year at a wireless company before doing the masters, both needed H1-B sponsorship.
I think we paid the bachelor guy $80k/year base, while the two masters we paid at the time $105-110k/year. That didn’t include bonus and didn’t include stock grants, which probably would have brought the bachelor guy to about $110k/year, and the masters people about $130k/year…If they stayed….
The bachelor guy left after working for 8 months, and went to Apple. The masters guy with an H1-B left about 10 months and joined qualcomm, I’m guess with a better offer, because back then they were throwing a lot of money to anyone with connectivity experience. The remaining person decided she wanted to stay and since then has been promoted. She didn’t go to qualcomm, even after she got her greencard, because her husband I believe works there, and I think they wanted to spread the risk of not working at the same company (in hindsight, probably a good move).
We also had a bunch of lateral hires that were already greencard holders and H1-Bs that stayed maybe for 1-2 years, before they too jumped ship and went to Qualcomm, Apple, Google. And last year we lost a lot of people to Intel that I heard were paying people 40%+ more because they wanted to ramp up their mobile business (and no, we weren’t underpaying people).
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Senior Management got tired and fed up with all of this churn in San Diego, since we we having a tough time keeping employees, during a time when parts of our business was being challenged. So to minimize disruption, management started to experiment by leveraging some resources in our Bangalore office. Some people were good, some people weren’t good. But then with the cost factor being significant lower, and with our difficultly in filling positions and keeping people here, gradually hiring picked up abroad, and the team overseas ended up growing bigger than our team locally. And that’s when the bean counters figured out that rather than deal with hiring more here (H1-B or permanent resident employees), that it was just easier to grow the team in bangalore, for less, and simply by the raw number of people, felt that projects could be run better that way. Partly true, partly false, but that’s the perception of what happened.
And so, for the longest time, every additional perosn that quit here locally, we lost that headcount, and 6-7 headcounts were re-allocated to the bangalore office. No one really liked this. None of the line managers did, neither did any of the directors, and not some of the VP’s. But what can you do? We didn’t have a good track record of keeping people when we did hire here..
In the sort of ironic twist, these same people that bailed to Qualcomm are probably going to need a job now. And the sad part is, they won’t find one at our firm anymore. Because we weren’t able to fill those positions at the time locallly, now those positions are elsewhere and so are the projects. That’s the sad part because, that business is actually doing ok.
So in short, H1-B at least from what I have seen, aren’t the problem….The bigger issue is when a big company sets up a offshore office, and your local team can’t get it’s act together and differentiate what you do that is better or more creative than an offshore location.
In the short time that I did work at Qualcomm back in the mid 90ies, there were a lot of H1-Bs (and I wasn’t one of them), but we were all paid the same. Again, I think (at least back then), big companies that do direct hires didn’t abuse the H1-B system nearly as much as the contractor/consulting companies. A big company, if they really wanted to save on cost, won’t even bother to hire locally in the U.S., but move work overseas… Looks like Qualcomm is going to try this experiment in the next year or so, since they too are hitting saturation.
What does this mean for U.S. employees? Simple. You better work on something in a growth area that no one else is trying. Because the moment the market hits saturation, you can bet your cushy position isn’t going to last.
