Employment-based green cards are hard to come by, so many employers use temporary work visas—H1B visas—to meet their needs for highly skilled workers. But temporary visas may not be the best way to draw talent to the United States. The restrictions on these visas make them a poor substitute for permanent residence and hinder our ability to compete for the best and brightest abroad.
President Obama and many policy and business experts have argued that the low share of employment-based visas constrains the competitiveness of U.S. companies. Employment-based green cards (visas for permanent residency) are capped at 140,000 a fiscal year, including visas for sponsored workers’ spouses and children. These visas are available to skilled workers, people with advanced degrees or extraordinary abilities, investors, and a few other special categories of immigrants. Employers have to petition for visas for skilled workers and those with advanced degrees. The maximum number of visas allotted to each country is capped at 7 percent, or 980 a year.
In 2010, only 5 percent of the over 1 million people receiving green cards became permanent residents through employment, rather than through family members, as refugees, or under other classifications; only 12,333 were workers residing abroad. The waiting list is long for employment-based visas, especially for workers from India and China, where applications are over the 7 percent country cap. For India, the State Department is currently serving applications for skilled workers posted by October 2002.
Skilled foreign workers can also enter the United States under the H1B temporary nonimmigrant visa program. According to a GAO report, annual H1B quotas have been exhausted much more rapidly in recent years, indicating a high demand from employers. The 85,000 H1B visa cap for workers and U.S. graduates for the fiscal year starting October 1, 2012, was reached by June 11, 2012. In FY 2010, 35,000 workers residing abroad were approved for H1B visas, three times more than the number of new arrivals on employment-based green cards. The remaining new temporary work permits went to workers already residing in the United States. In addition, 136,000 temporary visas went to workers whose employers were asking for extensions of their stay. A small number of employers, including staffing companies, dominate the H1B visa market.
With H1B visas, some employers get the skilled labor they need. But this may not be a good substitute for employment-based immigrant visas nor the best way to improve the competitiveness of American companies. Temporary workers are effectively tied to one employer, limiting their ability to take advantages of better opportunities elsewhere. They often pass through a period of unauthorized residence, may be victims of abuse and fraud schemes in a program with little oversight, and cannot plan on longer-term investments in the United States. They do not get the benefits conferred by a legal permanent residence, such as becoming citizens, and their family members cannot work nor petition changes in status, putting wives especially in vulnerable positions.
Proposals have been raised to increase the H1B cap, increase program oversight, and strengthen the labor market test. But reforms to the H1B visa program should be looked at in conjunction with fixes for the employment-based preference system. A broader discussion is also needed on whether this “country of immigrants” wants to become a “country of temporary immigrants.”