H-1B visas: Indian IT companies' quota remains unused

WASHINGTON: Challenging the assertion of several American lawmakers that H-1B visas grabbed by Indian IT professionals eat into their employment market, a new study by an eminent US thinktank has said that contrary to such perception, Indian techies create jobs in the country.

The report by the National Foundation for American Policy (NFAP) said contrary to the popular perception, India-based companies do not use up most of the yearly H-1B allotment.

Between fiscal 2006 and 2011, the top 25 India-based companies utilised between six and 15% of the new H-1B visa approved for initial employment, and 19.9% in fiscal 2012.

In fiscal 2012, the 26,865 new H-1B visas approved for the top 25 India-based companies equaled only 0.017% of the US labour force. Many of these companies perform services under contract to assist US companies in focusing on core business functions, it said.

"Research indicates measures to restrict the use of H-1B visas are not based on sound evidence and would represent a serious policy mistake that would shift more work and resources outside the United States," said the report's author Stuart Anderson, NFAP's executive director.

Rather than harming US workers or the US economy, H-1B visa holders contributed "between 10 and 25% of the aggregate productivity growth... that took place in the United States from 1990 to 2010," according to economists Giovanni Peri, Kevin Shih and Chad Sparber.

Peri, Shih and Sparber also found, "An increase in foreign STEM workers of 1% of total employment increased the wage of native college educated workers (both STEM and non-STEM) over the period 1990-2000 by 4 to 6%."

STEM stands for Science, Technology, Engineering and Math.

Economist Madeline Zavodny concluded that between 2001 and 2010, each additional 100 approved H-1B workers were associated with an additional 183 jobs among US natives.

A propsoed immigration reform bill introduced in the Senate suggests overhauling the H-1B visa system to end its use in outsourcing Americans jobs to countries like India.