- Organizations will maintain their workforce expansion efforts because they need workers despite increased visa costs. The report shows that employers will continue their international recruitment efforts even when H-1B visa fees experience a significant jump. The study shows that companies will keep their workforce needs because they expect to pay $100000 in visa fees. Some projections indicate that firms may still pay fees as high as $150000 to $200000.
- The main reason is the shortage of advanced skills in the United States. Many employers struggle to find qualified professionals in specialized fields. Employers will pay increased visa fees because they need to maintain their required workforce.
Wage Gap Between H-1B Workers and U.S. Employees
- Research from the National Bureau of Economic Research (NBER) shows that H-1B workers earn less than comparable U.S.-born employees. On average, an H-1B employee earns 16% less than an American worker with the same education, experience, age, gender, and job status.
- Salary levels vary by employer. H-1B employees at major technology companies such as Meta and Apple receive an average yearly salary of approximately $150000. H-1B employees at Indian IT service companies like Infosys TCS Wipro and HCL Tech receive salaries that are closer to $80000 annually.
- The wage gap appears smaller in major American technology firms. In companies such as Meta and Tesla, the difference in pay between H-1B workers and U.S.-born workers is minimal. The report "H-1B Wage Gap, Visa Fees, and Employer Demand" contains these findings which economist George Borjas uses to provide advice about U.S. immigration policies.
Most H-1B Workers Employed Outside Top Companies
- Data shows that 75% of H-1B employees work outside the top 25 companies. According to I-129 filings, about 46184 companies hire at least one H-1B worker over a four-year period.
- Most companies hire H-1B employees in only limited numbers. The 75th percentile of businesses employs three workers as their standard hiring practice. H-1B employees in companies that employ H-1B personnel receive different wages than American employees. American workers who hold identical jobs receive 18.5% higher wages than H-1B employees who work for U.S. companies.
- Employees with H-1B visas who work in fields outside major technology companies earn lower salaries than American workers who perform equivalent duties.
- Software developers represent 38.3% of all H-1B workers. The five most common work categories employ two-thirds of H-1B workers. The top ten occupations account for 75% of all H-1B positions.
- High-skill technology positions demonstrate strong market demand because employers actively recruit for these positions. The number of American workers who take advanced technical jobs has decreased over time. The ongoing trend establishes a shortage of skilled professionals in the field.
Will Higher Visa Fees Reduce Hiring?
- The H-1B employment model enables companies to save $100,000 during a six-year period when they hire an H-1B employee instead of an equivalent American citizen. The resulting financial savings enable complete coverage of the higher visa costs.
- Economist George Borjas estimates that companies will continue to hire H-1B workers even if visa fees reach $150,000 or $200,000 based on this financial advantage. The higher costs will lead companies to choose their employees more carefully. Companies will only accept workers who possess exceptional talents when their operational costs experience substantial growth.
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