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Columbia Business Monthly

H-1B visa processing slowdown discouraging smaller companies from hiring international workers

May 06, 2019 09:34AM
By Elizabeth Pandolfi

The H-1B visa program, which offers temporary visas to international workers in specific occupations, have become a thing of controversy during the Trump administration. The controversy surrounds the central issue of whether or not the visa program has a detrimental effect on American workers. 

The argument that it does goes like this: The availability of H-1B visas, which are used mainly in advanced industries like tech, manufacturing, and engineering, displaces American workers from jobs they would otherwise fill. In addition, detractors say that the program suppresses American wages because the international workers who arrive in the U.S. on H-1B visas will often accept a lower salary than the company sponsoring them would pay to a domestic worker. 

Back in April 2017, President Donald J. Trump—who has come down on the side of the detractors of H-1B visas—signed an executive order ordering the H-1B program and other visa programs to undergo greater scrutiny from federal agencies. Specifically, these agencies are supposed to determine whether or not these programs place enough priority on buying and hiring American. 

More recently, the administration has focused on questioning whether or not positions that have always qualified for the program—computer programmer, for example—do, in fact, qualify. 

So what has this meant for the program? And more specifically, how is it affecting businesses in South Carolina that use the H-1B visa program to fill positions? The greatest effect of this somewhat nebulous executive order has been a general slowdown in the processing of H-1B visa requests. 

The way the program works is that a company can submit an application for the H-1B visas they need. Major global employers like Amazon and Deloitte Consulting apply for thousands each year, while smaller companies may apply for just two or three. 

Visas are approved through the lottery system, and each year, Congress approves a cap on the total number of H-1B visas that will be available. In 2019, that’s 65,000.

While the approval system hasn’t really changed, processing time—and the level of difficulty involved on the part of the employer—has. 

“This particular visa has always been subject to a quota, so that’s nothing new,” says Mayor of Greenville and immigration attorney Knox White. “But administratively, for H-1B visas and work visas across the board, there’s clearly been a slowdown. There are a lot more questions being asked—called Requests for Evidence. You used to just occasionally get them, but now you get them for all kinds of work visas. The belief is that it’s an informal manner of discouragement.” 

These Requests for Evidence can be onerous for employers, who already have to spend a good deal of time and money applying for the program. There are wage qualifications, so the wages must be certified by the U.S. Department of Labor—according to White, that certification process is also taking longer than it used to. Companies must advertise for the position they want to fill. Then there are attorney fees, on top of the cost of the visa itself.

Considering the obstacles around cost and time that are already in place, slowing down the processing time is making companies think twice about using the H-1B visa program. “We had one we were working on for several months, and finally the employer just decided not to pursue,” White says. 

This is common among smaller companies that don’t rely as heavily on H-1B workers as many global companies, like GE or BMW, may. Charles Naselli, a Greenville-based recruiter with the firm Global Recruiting Network, recruits nationwide for manufacturing and distribution companies, and he deals with candidates who either already hold or want to obtain H-1B visas from time to time. 

In Naselli’s experience, the major employers are willing to deal with the increased cost and longer timeframe it takes to hire a person with an H-1B visa because often they do, in fact, offer them a lower-than-market salary. “Some large companies build a recruiting strategy that combines internal processes with a budget for outside immigration attorneys,” he says. “If it costs them $4,000 to acquire the visa, and each person is discounted $10,000 to market, then that’s a significant cost savings over the 3-year visa period. Plus, visa holders are reluctant to change jobs.”

Whether or not this practice is actually widespread enough to create wage suppression in the technical industries is unclear. “The evidence for that is pretty anecdotal,” says Jason Zacher, senior vice president for the business advocacy and Upstate Chamber Coalition. “The Chamber has supported expanding the H-1B visa pool—that’s something we’ve supported for a long time. Finding workers to fill these positions at all, even at entry-level, is difficult. With unemployment as low as it is, you have to go outside normal channels to find who you need.” 

White agrees. “If an employer is considering an H visa—especially this particular [H-1B] visa—in this tight job market, then they’ve hired lots of employees and haven’t been able to find the right American person for the job.”