The report, which is an analysis of government data obtained through a Freedom of Information Act request, comes amidst the growing outcry over granting of work visas to foreign professionals, some of whom are accused of replacing their American colleagues. Recently, Republican presidential front-runner Donald Trump proposed to raise the minimum wage for H-1B visa holders to dissuade American firms from hiring them.
The report found that nearly 86 percent of the H-1B visas have gone to professionals from India. Most of those H-1B visa holders are working for outsourcing companies, such as Infosys and Tata Consultancy Services (TCS). China lags behind in second place, accounting for just 5% of H-1B visas granted for foreign workers.
Some of these visa holders are also assigned to the US sites of different technology firms, such as Apple, for whom Indian outsourcing firms are serving as technology partners.
US technology firms have often argued that they have no option but to hire foreign workers and that there is a lack of skilled technology professionals in America. But some US groups doubt this argument and are of the belief that US companies hire Indian professionals to cut cost.
“It is not surprising that foreign workers are playing a pivotal role in the US technology market. They are no longer ‘cheap employees’. American firms are increasingly realizing that Indian professionals are competent,” said MP Kumar, CEO of Global Edge, a Bangalore-headquartered IT outsourcing firm with offices in the San Francisco Bay Area.
“We have very few H-1B visa holders in our US office, but I believe the temporary work visa is vital for the US technology sector to remain innovative,” Kumar added.
Some Indian H-1B visa holders might be displacing some American employees, but the temporary visa program has contributed to the growth of jobs across the sectors in America. A study conducted by Enrico Moretti for his award-winning book “The New Geography of Jobs” found that five new jobs are created for every tech job filled in US metropolitan areas.
There are other benefits too. A H-1B visa holder can work in the US for only six years. During this period he contributes a lot of money to the US social security fund, in addition to the payroll tax his employer pays.
More than the tax benefits, hiring foreign nationals for tech-related jobs is ‘critical’ for nearly a quarter of US companies, according to a recent survey conducted by Chicago-based VISANOW. More than 83 percent of the companies surveyed indicated that they would have hired a US citizen for the job were they able to find a qualified prospect.
Some analysts say that raising minimum wage and cutting access to H-1B visa holders may push US technology firms to shift a large part of their operation to emerging countries, where skilled employees are easily available at a cost-effective price.