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Why Visa Reforms Benefit Not Just California’s Tech Sector but the Economy Overall



The H-1B visa program needs urgent reform to benefit not just big tech but also smaller companies and the overall economy. (AP/Jeff Chiu)
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In Summary
The H-1B visa program is well-intended but flawed in its current form, largely favoring tech giants such as Meta. Without reforms, the intense demand for math, science and technology workers is hindering smaller companies and limiting competition.

Apart for our first names, I don’t have much in common with GOP presidential candidate Vivek Ramaswamy. But we do agree that the H-1B visa program – which lets companies employ foreign workers in tech and other specialized jobs – is broken.

Vivek Vaidya

Special to CalMatters

It remains to be seen if Ramaswamy will revive his call to “gut” the program. My advice? He’d be wise not to. The program needs reform, of course, but doing away with it could have devastating consequences for the business sectors that rely on it.

The H-1B program can provide a pathway to success for the workers who come to the U.S. on the visa. I should know – a similar program changed the trajectory of my life. I’ve been able to create hundreds of jobs in the decades since.

Like so many government programs, the H-1B visa is well-intended but flawed in its current form. The reforms most urgently needed would be to increase the number of visas allocated each year and to prioritize employers offering the highest wages.

Current State of the H-1B Visa Program

Currently, the annual cap is set at 65,000 visas, with an additional 20,000 slots allocated for workers with graduate degrees from American universities. That’s significantly down from the cap set in the early 2000s of 195,000 annually. According to Vox, for fiscal year 2023, only 26% of 483,000 applications – more than double the 201,000 petitions submitted for 2020 – were chosen for processing.

If there is no political will to increase the overall number of visas, we should consider raising the cap for those who have completed graduate degrees from American universities. Despite heavy investment in STEM programs in higher education, many companies claim they struggle to meet their hiring needs, especially in computer-related specialties. As a result, trained graduates with engineering and programming experience are in high demand.

Nearly 70% of applications in 2020 were for computer-related jobs with an average annual salary of $101,000, according to the Department of Homeland Security. By increasing the number of graduate visas, we could build the next generation of job creators and entrepreneurs.

Big Tech and the H-1B Visa Program

But increasing the number of visas alone won’t solve the problem if corporate giants stay the course. If you look at the top companies sponsoring H-1B visas in 2023, it’s a virtual who’s who of Big Tech. According to the Economic Policy Institute, Meta employs so many H-1B workers that it has declared itself an “H-1B dependent” firm in government filings for years because more than 15% of its total U.S. workforce is H-1B workers.

The problem is clear, the policy institute noted, “Visa use is and has been highly concentrated among a small number of employers.” In other words, Big Tech is hoovering up all the talent.

Proposed Reforms

Bipartisan support exists for reforms. Sens. Dick Durbin, an Illinois Democrat, and Chuck Grassley, an Iowa Republican, proposed a change to the program that would ensure that visas are first issued to employers offering the highest wages before being allocated to other petitioners. This may give smaller companies and startups a better chance at bringing much-needed foreign talent to the U.S.

The startup studio I co-founded is currently sponsoring dozens of H-1B visa workers, but we would like to bring in more if the playing field was fairer. More broadly, smaller, up-and-coming companies around the country would greatly benefit from access to such talent. That’s why it’s truly in the tech community’s – an American economy’s – interest to push for such commonsense reforms.

About the Author

Vivek Vaidya is the founding general partner of a startup studio, super{set}. He was previously the CTO for Salesforce Marketing Cloud.

About CalMatters

CalMatters is a nonprofit, nonpartisan newsroom committed to explaining California policy and politics.

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