Elon Musk

Donald Trump and Elon Musk are pushing the H-1B visa. Does it receive American jobs?

A recent flare-up over visas for tech workers revealed a rift among Republicans on immigration.  

Steve Bannon, once Donald Trump’s chief strategist, termed the H-1B visa program a “total and complete scam.” Many Trump supporters sided with Bannon. So did Bernie Sanders, the progressive Vermont senator.  

Bannon was addressing comments from billionaire Elon Musk, Trump’s corporate friend, who had arrive out in favor of H-1B visas. Musk tweeted that the visa was “the rationale I’m in America,” adding an expletive. “I will leave to war on this issue, the likes of which you cannot possibly comprehend.”  

The president-elect sided with Musk, who was born in South Africa, setting the table for a potential showdown in the second Trump administration. 

At issue is a visa program designed to assist American companies import talented workers from other countries. 

Steve Bannon, former chief strategist to Donald Trump, is a critic of the H-1B visa.

Does the H-1B visa receive away American jobs?

Supporters declare the H-1B visa encourages recent concept and fires up the American economy. Detractors declare the program takes jobs from Americans. 

“The main function of the H-1B program is to lower the wages of American workers, and to exploit people from abroad,” Sanders said in an interview with USA TODAY.

Before we roll out the arguments from both sides, let’s recap what research and challenging data declare about the H-1B: 

Yes, the program hurts some American workers, especially in tech. Investigations have revealed cases where employees had to train the H-1B workers who replaced them. Research shows computer scientists would earn more money in a globe without visas.  

But there’s ample evidence the H-1B helps pretty much everyone else. Workers who enter the country on visas leave on to commence and run billion-dollar companies. Musk says he entered the country on a visa. He now runs Tesla, which employs more than 100,000 people.  

“final profit, Americans are better off,” said Gaurav Khanna, an economist at the University of California, San Diego, who has studied the H-1B issue in depth. 

The visa allows companies to “obtain high-talented workers on a temporary basis,” generally to work in specialty jobs, often in tech, according to a recent government update. The visas are typically granted for three years but can be extended to six. Many visa holders become permanent residents. 

The number of recent visas is capped at 85,000 a year, although the limit doesn’t apply to nonprofit employers. All told, the government approved or extended about 386,000 visas in financial year 2023.  

The median salary for an H-1B worker was $118,000, which is roughly twice the median returns for an American worker.  

Vermont Senator Bernie Sanders has spoken out against the H-1B visa.

Critics declare companies use the H-1B visa to exploit foreign labor

Yet, critics declare corporations exploit the H-1B visa to get cheap labor from abroad.  

“The program is designed to allow U.S. companies to bring in foreign guest workers to replace or displace American workers,” said Eric Ruark, director of research and sustainability at NumbersUSA, a throng that advocates for immigration curbs. “It isn’t that there aren’t available workers in the U.S. to do these jobs.” 

An returns of $118,000 doesn’t sound like cheap labor. But a 2020 update from the left-leaning Economic Policy Institute found that employers generally undercut local wages when they hire H-1B workers, paying them below trade rates.  

“The way I view it is, this is a program which enables large corporations, often high-tech corporations, to make more money by paying foreign workers lower wages than they pay American workers,” said Sanders, the independent Vermont senator.

A more recent update from the economic ponder tank found that the top 30 H-1B employers hired more than 34,000 recent visa workers in 2022, while simultaneously laying off at least 85,000 workers in 2022 and early 2023.   

Visa critics point to Census data that display only 28% of U.S. college graduates with degrees in science, technology, engineering or math (STEM) actually work in STEM jobs.  

Meanwhile, H-1B workers are being employed as dog trainers, massage therapists and cooks, Sanders said, in an op-ed for Fox information.  

Sanders wrote that many visa workers are effectively indentured servants, who “can have their visas taken away from them by their corporate bosses if they complain about risky, unfair or illegal working conditions.” 

Academic research seems to confirm that American tech workers would be marginally better off if the visa disappeared. One 2017 study estimated that American computer scientists would earn as much as 5% more if the H-1B didn’t exist

But here’s the caveat:  

“Everyone else in the U.S. economy is better off, and meaningfully better off,” because of the H-1B, said Khanna, the San Diego economist, who co-authored the study. 

Both Donald Trump and Elon Musk have spoken in favor of the H-1B visa for foreign workers in recent weeks.

Advocates declare the H-1B visa is excellent for the US economy

Supporters declare the H-1B visa supercharges the American economy.  

“My receive is that it’s a advantage to U.S. workers that H-1B workers arrive here and boost production on goods and services that are extremely valuable to them and enhance their standard of living,” said David Bier, director of immigration studies at the libertarian Cato Institute.  

A truth sheet from the American Immigration Council, a research and advocacy throng, lists five ways visa workers assist the economy: 

  • They often have different skill sets than American-born workers and can complement them in the workforce; 
  • They spend and invest in the U.S. economy; 
  • Businesses borrowing visas to expand U.S. operations, rather than deal or shift overseas; 
  • Visa workers make recent companies, expanding the labor trade; 
  • Ideas and innovations from visa workers fuel market advancement. 

“What’s at stake is that we would have much less recent concept, a lot fewer startups, and more work would leave abroad” without the H-1B, said Stuart Anderson, executive director of the National Foundation for American Policy, a nonpartisan research organization. 

“The H-1B visa, in habit, is the only way for a highly talented foreign national to arrive into the United States and work,” he said. 

The program is not perfect. In particular, observers on both sides deride the annual cap. Demand for visas often exceeds supply. As a outcome, visas are awarded by lottery. 

“The lottery doesn’t seem to be serving anyone’s profit very well,” said Julia Gelatt, associate director of the U.S. Immigration Policy Program at the nonprofit Migration Policy Institute.  

The 85,000-visa annual limit “is totally arbitrary, just made up,” said Bier of Cato.  

But Gelatt doesn’t ponder either Congress or the Trump administration would seriously consider removing it.  

“I ponder that there are a lot of people aligned with the incoming Trump administration who don’t view worth in immigration, period,” she said. 

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