The US government, as part of its stimulus plan to revive the depression in the US economy, recently decided on including an amendment that imposes a ban on firms receiving government bailouts, from hiring workers from other countries. Microsoft has recently been asked to remove foreign workers that are employed under the H-1B Visa program, resulting in the software giant announcing that 5,000 jobs will be cut in the next six months; including 1,400 immediately.
H-1B visas are offered by the US government to enable international students and highly skilled international workers, from all over the world, or who are already living in the USA, the opportunity to live and work in America legally.
From the beginning, there has been criticism from various quarters, over the role of the H-1B program in replacing US workers. There were several instances of US staff being replaced with H-1B workers. The ploy employers used is to hire these H-1B replacements from contract job shops. This way the companies could claim that they had not applied for H-1B visas, making it possible for them to legally replace their US staff.
Another complaint was that US Employers hired H-1B workers because they pay significantly less than they would have to for US workers. This cheap labor causes depression in the overall wage structure.
Currently, 65,000 H-1B visas are granted by the US annually to Hi-technology workers from countries like China, India and Philippines.
The US government states that they are not against the H-1B program, but it has to be used in the actual spirit of why it was started in the first place – to have alternatives for specialized workers when there is no availability in the US. It was also clarified that since the 900 billion dollars for the stimulus plan is being paid by the American taxpayer, it is only fair that American workers are hired.
This decision for foreign countries could mean hundreds of thousands of foreign students studying in the US universities will not get employment and millions will be made jobless.
The US government is also planning on controlling outsourcing. American firms that move their jobs to other countries will not be eligible for any tax breaks. Obama, in his address said, “We will restore a sense of fairness and balance to our tax code by finally ending the tax breaks for corporations that ship our jobs overseas.”
This will affect more than 1,000 American firms that have over the years moved their jobs outside the country. The government is doing away with a particular provision of the tax code where US companies pay lower taxes for profits earned from foreign countries. There has been opposition for this tax code for a long time, as it was seen as an encouragement for companies to send their jobs abroad, when they rightfully belong to the American workers. The government’s aim through this move is to make outsourcing unattractive to companies in the US.
However, many believe that tax breaks when compared to savings through outsourcing do not stand a chance. While the idea of tax breaks would certainly appeal to the US businesses, it would require a huge tax break to change the established trend of global outsourcing. It would be highly unlikely for companies involved in significant outsourcing to take their businesses, and the related infrastructure and human-resource costs back onshore. So, the impact of this move may be very little.
People who oppose this move say that this move will only hurt the US as outsourcing makes a lot of sense; both economic and logical. It is left to be seen what actually happens. However, with Obama focusing on the revival of the US economy, this is the kind of positive reaction that Americans expect from their new President.
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WORD WEAVE...your statement what the foreign students spend....
Did you perhaps work directly as an International Student Advisor: then please correct your statement.
FOREIGN STUDENTS are basically wealthy to begin with...that is why they can afford what they pay if they pay as their nations do not have mandatory education like the USA which steals more tax dollars for teaching English as a 2nd language than teaching USA students whose parent pay for both...and
I might ad: do you know what AID and IMF are? You should they pay for the other foreign students: which is your tax dollars.
THEN we have ILLEGALS who moan and complain: just look in your daily newspaper for PROPAGANDA USA repeated sob stories...
ILLEGALS receive IN - STATE TUITION: while USA student and MILITARY yes both citizens of generations pay OUT-Of-State TUITION/
PUKE--when Americans give out WRONG, ERRONEOUS INFORMATION and even make ignorant comments: no wonder we are failing...and can't compete....
Is there anyone that doesn't know about IMF? We all know and appreciate that the United States helps international students in many ways. We also know why so many international students seek education in the U.S.
But why does the United States continue encouraging more students to study here?
Some may think that educating international students is not important. But it has always been important for the United States. While the billions of dollars they bring in is a known "fact," there are several other factors involved. With globalization, domestic issues are now international issues. The dependence on international talent in the fields of technology and science is an important reason the United States educates these students, who are then hired for research and in high-tech industries. Much of the research in science is conducted by people from other countries, who received their education here. Yes, it is important to ensure more Americans are educated in these fields, but it has to be done while retaining foreign talent.
Research also shows that there are fewer international students in U.S. colleges today than a few years ago, which is a matter of worry for the United States. Why do you think so much importance is given to the "International Education Policy?"
An educated American should be able to understand that along with the local talent, international talent is also necessary to respond to the demands today.
most H1b in IT filed do the weekly maintenance on saturdays !!!.If the h1b work is taken over by Americans, who will be doing the saturday night partying? " like in H&K go to white castle"
There are so many inaccuracies in this article. I don't think the author knows much about this subject. First of all, Microsoft was not "asked" to terminate 5,000 employees. These workers were laid off to cut cost. Many are not H1-B holders but native US citizens. Secondly, over 70% of H1-B visas are granted to Indian IT workers. The next 11% goes to Canada. Followed by 7% to China, 6% each to Japan and France. In addition, Indian outsourcers like Infosys, Wipro, TCS also use L-1 visas extensively to import their workers from India. This visa should only be used for intra-company transfers, not to be used by consultants to work at clients site. It has been badly abused by Indian outsourcers because it does not require the company to pay taxes on the workers' behalf, and there's no limit to how many can be used. Over 300,000(70%) L1 visas a year are estimated to have gone to India. Followed by the UK, Canada, France, Japan.
There's no doubt that Indian outsourcers are hollowing out the US IT industry wholesale. Companies like Microsoft and Intel are increasingly outsourcing their entire development and testing functions for entire software products to outsourcers like Infosys, who then import their workers from India to work on them. Some of this work also get offshored to their main offices in India. H1-Bs at Microsoft get paid over $100,000 a year. H1-Bs at Infosys would be lucky to get half as much. Many only get $24k a year for testing. Infosys and the other subcontracting companies get to keep most of it.
Many completely ignorant CEOs and people like Tom Brokaw are buying into the notion (pedaled to them relentlessly by NASCOMM shills like Vivek Wadhwa) that these are the "best & brightest", "highly skilled" from India and should be given a green card instantly, when infact many are completely underqualified. Even Indian IT bosses said only 25% of Indian IT grads are employable. Most are from some unheard of diploma mill in India, downright lie about their qualifications in their resume, received no more than a 3 month crash training course in India before being imported to the US as "experts". Indians now make up the largest % increase in illegal immigrants in the US in 2010. Many simply overstayed their H1 or L1 visas.
America really needs to wake up to this deceitful game played by Indian outsourcers. If we continue to lose IT jobs to them, fewer and fewer American citizens will want to go into IT, and we will lose our IT edge over other countries. Computer Science and Engineering is still the future, it's just the future won't belong to us if we continue to give away these jobs. We need to stop going for the quick buck and hire cheap labor from India and the Phillipines, and start nurturing home grown talent. This "skilled worker shortage" thing being sold to us by CEOs and Indian outsourcers is a self-fullfilling prophecy. We cannot keep importing foreign labor forever. Pretty soon America will become overcrowded and turn into a 3rd world country like India, Mexico and the Phillipines.
my comment is dat d usa govt should not let company dat move from usa to benefit from d tax becos am stii come to usa pls adverse me on how to get usa passport thank god bless america and god bless nigeria send my comment to obama