Work Visas: Lose the Lottery

The H-1B system needs an overhaul. For now, let's award visas to the highest-paid foreign workers and top graduates from top U.S. schools

by Vivek Wadhwa

The U.S. government will use a random computer lottery to determine which of 163,000 applicants receive the 85,000 work visas it grants this year under the so-called H-1B program. This roster of foreign workers includes some of the world's best and brightest minds. There must be a better way to determine which of them get the nod to work at U.S. companies such as Microsoft (MSFT) and Google (GOOG)—and which must return to their home countries, where they're likely to become our global competitors.

Finding the right solution to this contentious issue won't be easy. Opponents say H-1B visas cause job losses. Employers say they help fill critical job openings. Tech executives like Microsoft Chairman Bill Gates and Intel (INTC) Chairman Craig Barrett press for unlimited numbers of these temporary work visas; unemployed tech workers fight for their elimination. While these debates rage, there are bigger, related problems brewing. We have more than 1 million skilled workers and their families who are already here on temporary visas, and who are stuck in "immigration limbo" (BusinessWeek.com, 8/22/07).

Professor Guillermina Jasso of New York University, who is considered a leading expert on immigration, says the lottery system was designed to "provide a semblance of fairness." The American people and policymakers have not been able to agree on the exact criteria for admitting skilled H-1Bs, she says. One side argues that there is a hierarchy of skill and that we should choose from the top down. But others say we need to diversify and sample from a broad spectrum of skills. In the absence of any consensus, the lottery is the best way to go despite its flaws, Jasso says.

The Salary Issue

The problem is that the lottery and temporary visa system may be distorting market dynamics. I know from my experience as a tech CEO that H-1Bs are cheaper than domestic hires. And if we bring in too many workers at the lower end of the scale, we could end up causing a reduction of salaries to the point that Americans don't consider technology-related professions worthwhile. Already there are indications that enrollments in computer science have dropped. The fact is that if you flood the market with workers with any skill, you end up hurting the profession—causing salaries to drop and unemployment to increase.

A short-term fix to the H-1B problem may be found in a proposal by the most unlikely player: the Programmers Guild, the group that has been the most ardent opponent of H-1B visas. The guild says that instead of deciding who gets a visa by lottery, we should pick the most highly skilled based on their salaries. And we should give preference to the top graduates of our universities. We won't need to increase the numbers of visas if we're more selective, or so the argument goes. We can't have a random lottery determine which jobs get filled or which students get to stay. We want to fill the most specialized jobs and to keep the best and brightest.

Kim Berry from the Programmers Guild says that in the tech world, those who have the best skills are usually the highest paid. Salary is an effective proxy for skill. He argues that a PhD genetics researcher should never lose out to a $16-a-hour accountant. If H-1B visas were granted in this manner, "every $100,000 H-1B that Bill Gates filed would get approved," he argues. And any business with a critical need for an H-1B candidate could be assured of approval by paying a higher wage.