The Blind Squirrels in Media Finally Find the H-1B Nut

Maybe we have Elon Musk and Vivek Ramaswamy to thank for their effusive praise of the H-1B program, because suddenly the media is skeptical. Bloomberg has released a report reviewing H-1B data for new hires in 2020-2024 and found third-party employers (aka staffing agencies) used the program to funnel cheap foreign labor to companies like Citi, AT&T, and Verizon. Meanwhile, ProPublica also covered the shameful way Americans are shut out of the job market by H-1B visa holders who employers are sponsoring for green cards. 

ProPublica refers to the immigration sponsorship process in the headline as a “ruse.” Bloomberg’s headline refers to the H-1B program as a vessel for “cheap labor.” These facts were considered myths and anti-immigrant nativist screeds as late as 2024. 

Perhaps we should also thank Senator Bernie Sanders, who in January said that the H-1B program hurts Americans and foreign workers equally for the profit of unscrupulous employers. 

To be clear, the H-1B program was a scam from the jump. By 1995, it was admitted in testimony to Congress that the studies showing there would be a labor shortage in technical and scientific fields were false. Yet the program has hummed along and even been expanded since. 

Some labor economists told the truth from the beginning, but most others were cashing checks and stepping on American workers’ necks. Ron Hira, one of the few advocates for American tech workers in the wilderness, was quoted by ProPublica saying:

“‘Whichever way you look at it,’ said Ronil Hira, a Howard University political science professor and research associate at the Economic Policy institute, ‘the PERM process is crying out for reform.’ As he put it, ‘Everyone in the industry knows it’s a joke.’”

“Ruse,” “cheap labor,” and now “joke.” This is an accurate word jumble to describe the legal immigration system in this country. And the only ones in on the joke are the employers and their lobbyists and politicians. 

Some of the unscrupulous employers are not even coy about what they are doing. ProPublica describes one:

“Divi, the manager at Softrams, was quite forthcoming about how PERM works at the 450-person company, whose largest client is the Centers for Medicare and Medicaid Services and which was bought last year by another company, Tria. She told me that Softrams had 69 employees on H-1B visas, had never hired another applicant during the PERM process and had received zero applicants from the latest ads.”

Department of Labor…if you’re listening…perhaps take a closer look at this company. It also appears that they are admitting to discriminating against Americans in their hiring process, so the Equal Employment Opportunity Commission should get involved based on their February notice to weed out discrimination against American workers. 

And the Bloomberg report exposes in greater detail what many have already known about the staffing agencies abusing foreign workers for profit and the major companies happily playing along. Citigroup was a major abuser of H-1B staffing agencies. Is it a coincidence that Citi also has had major data breaches? The government fined Citi for failure to fix longstanding data management issues. When you hire cheap labor, you get what you pay for. 

The Bloomberg report also makes clear just how much cheaper these workers are, thus demonstrating the hopelessness for American workers seeking economic security. A typical staffing-agency H-1B worker was paid about $48,000 less than an actual employee. That’s quite a pay cut, as these workers also have little in the way of benefits and have to pay part of their meager salary to the staffing agency that's exploiting them. 

How can American workers compete with workers willing to take a $50K pay cut and pay a percentage of their salary for the privilege? The answer is that they either drop out of the market or accept an even lower bid. How can our government use immigration policy to create such an environment for its own taxpayers? 

With a proudly America First president, one would assume the times are changing, but while President Trump has kept his promise to secure the border and fight the cartels, he has not restored the Buy American Hire American ethos of his first term. 

The H-1B program was under a microscope in the first Trump term after it was singled out in President Trump’s Buy American Hire American executive order. Denial rates for H-1B visas climbed higher during the first Trump term, cracking over 20 percent denials, as opposed to 10 percent denials in 2016 and just six percent in 2015. 

In 2020, President Trump’s support for American tech workers reached its zenith with an H-1B rule requiring the allocation of visas based on wage level as opposed to random allocation. Additionally, take a look at this review of the 2020 Department of Labor’s attempt to raise H-1B wages:

“The Department of Labor final rule is also based on a significant provision in a bill, S. 2266, sponsored by Senator Charles Grassley (R-IA), that failed to pass Congress. As in the DOL final rule, S. 2266 eliminated Level 1 and effectively made it Level 2. The current Level 2 wage is set at the 34th percentile, and the new Level 1 is at the 35th percentile. That means the final rule eliminates the entire Level 1 wage level and pushes everything else higher. Key Grassley staff later took important immigration policy positions in the Trump administration.”

Of course, the Biden Administration didn’t allow any of the Trump rules and regulations raising American wages to go into effect.

So, President Trump’s second administration, which is far more aggressive on the border and deportations this time around, needs to simply dust off the first term actions on legal immigration to save American workers. Rest assured American workers desperately need saving because layoffs are rising. Also, keep in mind that AI is burning through jobs at home, as outsourcing to cheaper labor in foreign countries continues. 

The only thing the first Trump Administration did not do is bar staffing agencies from petitioning for H-1B workers. The H-1B program requires the petitioning employer to present a bona fide job offer. Staffing agencies do not have a job offer. Instead, they offer the employee nothing more than the possibility of being placed with an employer at a future date. Many aliens end up “benched” for months with no pay while here on H-1B visas. Third-party employment of H-1B visa holders should be prohibited entirely.

The wage theft and discrimination against Americans highlighted by both Bloomberg and ProPublica, make it impossible to ignore that the whole program is a scam. The President can bar all H-1B admissions under 8 U.S.C. 1182(f), and the media has given fresh justification to find that H-1B admissions are detrimental to the interests of American workers. Barring that common-sense action, the President must at least refresh his 2020 protections for American workers that Biden nixed before they went into effect. It is an easy win for the American workers desperately counting on this President to make immigration policy great again.