H-1B cap deadline passes, but debate not over

A congressional cap on the number of foreign workers allowed to come into the U.S. on H-1B visas has fallen to pre-dot-com boom levels after the U.S. Congress failed to act before Wednesday, but debate on the visa program is not over.

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Congress could still act to raise the number of H-1B visas even though the 2004 fiscal year has started with a cap of 65,000, some supporters and opponents of a higher cap said Thursday.

Intel will continue to press for a higher cap, and to have advanced-degreed engineers exempted from the cap, said Tracy Koon, a company spokeswoman. "It's clear when you look at U.S. graduation numbers, there's a shortage there," Koon said. "A cap of 65,000 is going to be insufficient." Close to 80,000 H1-Bs were granted in the 2003 fiscal year, and the 2004 fiscal year started Wednesday with a backlog of close to 30,000 applications, Koon said.

Even opponents of a higher H-1B cap acknowledged that the fight isn't over even though the congressional deadline passed. H-1B program critic Norm Matloff, a computer science professor at the University of California at Davis, said he expects the issue to resurface in early 2004.

"According to what I've heard, the industry lobbyists are waiting until next year, maybe early next year, before making their move," Matloff wrote in an e-mail response to questions. "They and the politicians are hoping that the economy will be better then, thus providing them with 'cover.' But even if the economy does improve, and even if that improvement includes the tech sector, programmers and engineers won't benefit, because those new job openings will go to H-1Bs and L-1s." L-1 is another visa program also headed for debate in Congress.

The U.S. Chamber of Commerce also expects that the cap issue might come up in Congress again in early 2004 if the cap level is reached, said Theresa Brown, director of immigration policy for the organization. The Chamber, which has questioned the need for a cap, hasn't decided what its next move will be in Congress, Brown said.

The annual H-1B cap went from 65,000 in the U.S. government's fiscal year 1998 to 115,000 visas granted a year in 1999 and 2000, then up to 195,000 after 2000. The capped H-1B numbers don't include some workers, such as those employed at universities and some research organizations, but the caps do affect how many IT workers U.S. companies can bring into the country.

The L-1 program allows companies to transfer high-level executives and workers into the U.S. to fill vacancies. Matloff and other critics say the L-1 program is abused by companies that use L-1s to replace U.S. workers, and a bill in Congress called the USA Jobs Protection Act would require U.S. employers using H-1B and L-1 visas to pay comparable wages to the immigrant workers as they pay to other workers and would require that companies not displace U.S. workers to hire immigrant workers.

The Institute of Electrical and Electronics Engineers-USA is calling on Congress to address visa loopholes, said John Steadman, president-elect of the organization. The IEEE-USA wants Congress to keep the H-1B cap at 65,000, but like Matloff, Steadman expects some debate about the cap in coming months. Unemployment among electrical and electronic engineers reached 7 percent in early 2003, Steadman testified at a congressional hearing in September.

"I would be surprised if Congress raises the cap a long ways above the 65,000," said Steadman, an engineering professor at the University of South Alabama.

Spokesmen for cap-raising opponents Senator Dianne Feinstein, a California Democrat, and Representative Thomas Tancredo, a Colorado Republican, said they know of no current efforts in Congress to raise the H-1B cap. There seems to be more interest in L-1 visa reform at the moment, said Tancredo's spokesman.

Raising the cap may be a difficult sell in Congress right now, although Intel believes shortages of some specialized IT workers and engineers exist, Koon said. "Everybody understands that the political climate right now is such that this is a difficult issue," she said. "Hopefully, we're on the verge of an economic recovery this year."

The congressional cap on H-1Bs has had no connection to actual hiring data, Koon said. Although 195,000 may have been a bigger number than needed for the past year, 65,000 would go too far the other way, she said. "Why doesn't Congress allow the free market to work?" she asked.

The caps have little connection with real-world hiring trends, the Commerce Chamber's Brown agreed. "We'd like to look at the issue in a broader way so that companies that need access to talent can gain that access the way they need it," she said.