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As a professor at Berkeley, I see the impact of H-1B visas and artificial intelligence on student employability


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The H-1B visa program was intended to attract specialized talent from abroad, but instead became a tool for employers to hire cheaper labor for routine work.

The result is a skewed labor market in which highly skilled workers are squeezed out of the H-1B visa program by spamming ordinary workers, who then fill entry-level positions that are already in short supply. This abuse of H-1B visas has a negative synergy with growth the impact of artificial intelligence on the labor market and is part of a wider problem that urgently needs attention.

The impact of this visa farming problem is particularly acute among young adults and recent college graduates, who face a bleak job market despite a moderate overall unemployment rate. The ratio of unemployment among college graduates under 25 to those over 25 has hit an all-time high of more than four to one, according to government data. This means that there are already four times more entry-level jobs than jobs that require experience or advanced knowledge.

visa application

Applicants to the programs must clearly be people with specialized skills, and these specialized skills must not be readily available from available resident workers.

I have seen firsthand the symptoms of declining demand entry level technical jobs. These symptoms include fewer job postings from recruiters targeting fresh CS graduates, job fairs with fewer companies, and interested consultants receiving fewer lower-paying offers, and in some cases no offers at all. Issuing H-1B visas to low-wage non-skilled workers only exacerbates this shortage, but does little to meet the real demand for skilled workers.

H-1B VISAS HARM ONE WORKER AND EXPLOIT ANOTHER. THIS MESS NEEDS TO BE FIXED

The problem here is not the number of visas issued, but how they are used. Applicants to the programs must clearly be people with specialized skills, and these specialized skills must not be readily available from available resident workers. However, the bureaucratic vetting process allows employers to inflate claims and hire workers with ordinary skills for low wages. There is an entire sub-profession of human resources and attorneys who specialize in dressing up pigeons to look like peacocks.

Abuse of the application process has created a lottery system where workers with the necessary special skills often lose out to those without any special skills. As a result, it becomes more difficult for recent graduates to get entry-level jobs, while companies that really need specialized skills are unable to obtain visas for these workers. Imagine a person suffering from malnutrition and diabetes at the same time because he is taking sugar pills instead of vitamins.

I want to emphasize that I am not in favor of restrictions on the islands number of H-1B visas. The challenge is to ensure that people with real specialized skills that are really needed are welcomed through the H-1B program. When used properly, the H-1B visa attracts an individual who complements the workforce with necessary and specialized skills that can benefit the entire country. Whether it’s retaining a graduate foreign student or attracting someone from outside the country, the U.S. has historically benefited enormously from immigrants with needed skills.

Many people invested in the visa economy insist unconvincingly that H-1B visas are already reserved for skilled workers, but the H-1B visa recipient statistics are inconsistent.

TRUMP SAYS HE HAS NOT CHANGED HIS OPINION ON H-1B VISAS AS MAGA COALITION DEBATE PLAYS OUT

According to an annual report by the U.S. Citizenship and Immigration Services, nearly 63,000 H-1B visa recipients in 2023 were engaged in “computer-related processes” and the median salary for this group was $99,000 per year, with 25% of they earn less than $85,000. A salary of $99,000 or $85,000 a year is certainly a good amount to earn, but it is quite low for what I would expect from someone with rare specialized skills in this field.

You might think that people with specialized, hard-to-find skills would earn exceptionally good salaries, but instead, the data shows the opposite. In fact, the more I dig into the agency’s annual report data, the less it seems that the approved applications are for exceptional people for specialized jobs. It’s more like some specially skilled workers mixed with a lot of regular workers who are paid less than I expected.

These observations are consistent with my own experience hiring techies and advising CS students, with what has been related to me firsthand by others, and with many recently published analyses. The only clear explanation for these discrepancies is that employers are representing entry-level positions rather than those requiring special rare skills, that even for entry-level salaries are low, and that these inappropriate applications are not being rejected.

Looking at the bigger picture, the misuse of H-1B visas is not the only obstacle facing US job seekers, as AI automation is also eliminating jobs, exacerbating the shortage. Currently, the impact of AI is disproportionately affecting entry-level jobs, exacerbating the problems caused by the abuse of the H-1B program. However, AI will continue to improve in both capabilities and ease of use, and its impact on the job market will grow as the range of tasks that AI can perform expands.

H-1B MAGA “CIVIL WAR” IS EXACTLY HOW POLITICS SHOULD WORK

While AI and H-1B visa abuse may appear to be different issues, they interact in a way that most people do not like. Even if it cannot completely replace the human worker, AI makes motor work easier from regular employees to contractors or remote workers.

The explanation is that artificial intelligence often removes the need for advanced specialized skills or knowledge and replaces them with fewer requirements related only to the ability to review the work for correctness. As a result, tasks that were previously too complex to outsource to contractors or remote workers are now made simpler by AI and more amenable to outsourcing.

As AI technology improves, employers will find that more and more jobs can be filled by less-skilled workers, and there will be a growing incentive to use H-1B visas to hire these less-skilled workers cheaply.

The H-1B visa review process needs to be reformed to prioritize applicants with genuine, specialized talent and to ensure that recipients do not compete unfairly with workers already in the US. We must also address the growing threat of artificial intelligence automation and its growing impact on the labor market.

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About 90% of the total US tax returns comes from taxing the incomes of working people, so if unemployment continues to rise, tax revenues will fall sharply. At the same time, the number of unemployed people who need public assistance will increase dramatically. This combination does not work mathematically and is an obvious recipe for disaster.

This situation requires radical changes to avoid a dystopian future. The overall unemployment numbers may seem high, but the high entry-level unemployment rate and overall underemployment point to a much bigger problem developing.

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Disclaimer: Any opinions expressed in this article belong solely to the author as a private individual. Nothing in this article should be construed as a statement regarding the professional position of the author at any institution.



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