The WSJ reports:
“WASHINGTON—President Donald Trump has suggested he might find a way to cut the number of coveted H-1B visas awarded to outsourcing firms. But the companies appear to be heading in that direction all on their own, amid technological changes.
Outsourcers’ use of H-1B visas, which are reserved for highly skilled foreign workers, fell last year, before Mr. Trump won the Republican presidential nomination, new data show. The slide occurred alongside increasing criticism of the firms’ business model.
Mr. Trump has criticized the lottery that is now used, where companies all have equal chances at the scarce visas, and signed an executive order directing a review of the program. The order called for changes that would ensure visas are awarded to “the most skilled and the highest paid” applicants, to avoid crowding out American workers.
Six of the seven prominent Indian-based outsourcing companies that do work in the U.S. received fewer H-1B visas in 2016 than they did in 2015, and as a group their numbers dropped 37%, according to a new analysis by the National Foundation for American Policy, a think tank that backs increasing the total number of H-1B visas available. Most outsourcers based in the U.S. and elsewhere also saw declines.
For instance, H-1B visas awarded to India’s biggest outsourcer by revenue, Tata Consultancy Services Ltd., plummeted by 56% to 2,040 last year from 4,674 in 2015. For Wipro Ltd, another major Indian firm, the number also dropped by more than half to 1,474 from 3,079 in 2015.
Other research from previous years shows that the use of H-1Bs by individual outsourcing companies peaked in 2012 and 2013, sliding ever since. Many expect that the number of visas given to outsourcers will decline again for 2017, but those numbers aren’t yet available.
Meanwhile, the number of visas awarded to some large U.S. technology firms, who have a different business model and compete with outsourcers for visas, increased last year. Amazon.com Inc., Microsoft Corp., Alphabet Inc.’s Google and Apple Inc. all received more visas than they did in 2015, the new data show. Such companies typically use the visas to recruit employees with rare skills that attract higher wages than staff employed by outsourcers, and have come under less criticism.
Each year, 85,000 H-1B visas are available, and for the last several years they have been awarded by lottery conducted in April because of overwhelming demand.
Following this year’s lottery, Mr. Trump criticized the process and suggested more visas should go to high-paid jobs as opposed to a lottery where each application has equal chance. Because many outsourcing jobs are paid the minimum required to comply with certain rules—around $60,000 a year—many interpreted Mr. Trump’s comments as a warning to the outsourcers and a possible boon to big tech companies that pay high salaries.”
Read the full WSJ article at the link.
I also blogged about the need for H1-B reforms yesterday.