Intel’s Stock Crashes as Visa Worker Population Rises

Investors lost $40 billion last week when Intel Corp. admitted a technical flaw has delayed a new generation of computer chips.

The company’s stock crashed 18 percent even though the company is a leading user of the visa worker pipelines that advocates say provide CEOs with “the best and brightest” foreign graduates.

But those pipelines should be shut down because they sideline American professionals, suppress meritocracy, and damage the U.S. technology sector, says Kevin Lynn, director of U.S. Tech Workers. Intel’s crash “seems to follow the trend of other companies that become dependent on visa workers,” he said. “Can we point directly and say [reliance on visa workers] is the cause? No, but it is indicative.”

On June 22, President Trump temporarily shut down a few of those pipelines, amid furious opposition from universities and corporate lobbyists. In response, Fortune 500 companies are pressuring administration officials to reopen the flows of “top tier talent” in January, despite massive unemployment in the U.S. economy.

Intel’s stock crashed July 24, shortly after CEO Bob Swan said, “We have identified a defect mode in our 7nm [seven nanometers]  process that resulted in yield [production quality] degradation.”

“We’ve root-caused the issue and believe there are no fundamental roadblocks, but we have also invested in contingency plans to hedge against further schedule uncertainty,” he added. The contingency plan is to outsource some production from Intel’s chip-making plan to a Taiwan company, Taiwan Semiconductor Manufacturing Co. (TSMC).

The response from Wall Street stock experts was brutal — even though the company also reported higher sales and larger profits.

“We view the roadmap missteps to be a stunning failure for a company once known for flawless execution, and could well represent the end of Intel’s computing dominance,” said Chris Caso, an analyst at Raymond James, according to a Bloomberg report.

“With the latest push out of process technology, we believe that Intel has zero-to-no chance of catching or surpassing TSMC at least for the next half-decade, if not ever,” Susquehanna analyst Chris Rolland said, according to Bloomberg.

Intel’s bad news comes after multiple other shocks.

In March, Wired News reported:

Newly discovered hardware flaws seem to bedevil Intel every few months. This time it’s a flaw in Intel’s Converged Security and Management Engine’s mask ROM, a particularly nasty spot for a bug because it can’t be patched with a firmware update. “Because this vulnerability allows a compromise at the hardware level, it destroys the chain of trust for the platform as a whole,” wrote security firm Positive Technologies in a blog post announcing the issue. Intel argues that pulling off an attack would require local access, specialized gear, and a high level of skill, making it relatively impractical in the real world. Given the potential impact, though, it’s still a concerning flaw—one that affects every Intel CPU and chipset released in the last five years.

In July 2019, Intel sold its faltering smartphone business to Apple. ElectronicDesign.com reported:

Intel said on Thursday that it plans to sell the majority of its 5G smartphone modem business to Apple for $1 billion, washing its hands of a business that had been weighing it down. As part of the deal, around 2,200 employees from Intel will join Apple, which also agreed to acquire patents and other assets to help expand its effort to control all the major components inside its iPhone.

Intel is losing market share to Advanced Micro Devices. In late 2016, AMD held a 17.5 percent share of one major category of computer chips. By mid-2020, AMD had doubled its share to 35 percent, according to Statista.com.

Amid the bad and good news, Intel relies heavily on visa workers imported via the H-1B, L-1, and other pipelines.

For example, from 2017 to 2019, the company asked the federal government for roughly 4,300 H-1B visa workers and another 1,000 workers in 2020.

But Intel also hires many foreign graduates via U.S. universities’ Practical Training programs. In 2018, for example, they at first hired 1,348 foreign graduates, including 368 on one-year work permits and 1,111 on three-year work permits. In 2017, the company hired 1,683 foreign graduates, including 613 on one-year work permits and 998 on three-year work permit permits.

The data suggests the company employs roughly 3,500 of these Practical Training foreign graduates.

These visa workers are supposed to leave after several years. But many foreign graduates jump from one pipeline to another so they can extend their stay up to 12 or more years.

Also, Intel nominates many of these foreign workers for green cards. Once nominated, foreign workers are allowed to stay in the United States indefinitely. But the nominated workers usually cannot leave their employers until they can get their green cards, often decades later. From 2017 to 2019, Intel nominated roughly 4,800 foreign workers for green cards.

This visa worker inflow is reshaping the company. The company’s 2016 diversity report said that Asians comprised 40 percent of the technical staff, up five points from 35 percent in 2014. The company has not released 2020 diversity data.

This workforce shift is widespread among Fortune 500 companies. Fortune 500 companies keep at least 1.3 million visa workers. Also, corporate bios show that former visa workers now serve as top leaders of Microsoft, Google, Adobe, IBM — and also Intel. For example, Intel’s’ chief computer architect was born in India, and Bangladeshi-born Omar Ishrak is chairman of Intel’s board.

Many Americans tell Breitbart some of the visa workers are very good.

But corporate executives have not shown imported visa workers are better than Americans, said Jessica Vaughan, policy director at the Center for Immigration Studies.

That is a really important question. Everyone assumes the foreign workers are either better and higher-performing than Americans, or that they are equal substitutes competing equally for the jobs. In fact, they may be imported because companies prefer to bring in workers who are valued because they will accept lower wages and be more compliant.

It remains to be seen if this is really good for these companies. If there is much ethnic nepotism in the hiring process, is that making them stronger companies? Or are they eventually going to experience a decline and fall?

Intel’s green card requests reveal some details about the company’s hiring of visa workers.

For example, the company sought green cards for only 45 people who arrived with O-1 “genius visas” which are given to people with a record of “Extraordinary Ability or Achievement.”

In contrast, 77 percent of the green card nomination went to foreigners with master’s degrees — and only 13 percent went to foreigners with PhDs. Ten percent went to people with bachelor’s degrees.

MyVisaJobs listed the universities where Intel mostly recruits “the best and brightest” foreign graduates:

Arizona State University (583); University Of Southern California (423); Portland State University (365); San Jose State University (197); The University Of Texas At Dallas (186); North Carolina State University (184); Texas A&M University (167); California State University, Sacramento (145); University Of Minnesota (143); Georgia Institute Of Technology (110).

The company also sought green cards for 89 spouses of H-1B and L-1 visa workers.

Intel’s press office did not respond to emails from Breitbart News.

The company tries to hide its growing number of foreign workers.

The company’s 2019 diversity report hides the numbers of Indian and Chinese employees under the category “Majority Population,” and does not differentiate between Americans and foreign-born employees.

“The white male and Adian male majority population continue to represent more than 90 percent of the senior technical roles,” said a report about diversity in 2017.

The 2016 diversity report, however, said Asians comprised 40 percent of the technical staff, up to five points from 35 percent in 2014. The “white” share fell from 52 percent, down five points to 47 percent during the same period. All other demographic groups remained stable at just 14 percent of the technical staff.

The number of Asians in technical jobs grew from 15,048 to 16,794 in 2016. Just 15 percent of non-technical jobs were held by 1,155 Asians in 2016.

Just 21.4 percent of the company’s 313 senior executives in 2014 were Asians. By late 2016, that number had risen to 23.5 percent of 364 jobs.

The numbers understate the role of foreign workers because Intel also employes many additional Indian visa workers via contracts with Indian staffing companies, including HCL and Infosys. OregonLive com reported in April 2019:

Information technology (IT) professionals don’t usually develop new technology but they play an essential role in managing a company’s internal systems. Their work is particularly important at tech companies such as Intel, which depend on IT workers to keep systems secure and running smoothly.

These outside staffing employees — and the roughly 3,500 Practical Training graduates – may not be included in the company’s diversity reports.

Intel’s 2016 report touted the company’s pro-diversity efforts while underplaying the growing share of technology jobs held by Asian workers:

Last year, Intel set an ambitious goal to be the first high technology company to reach full representation of women and underrepresented minorities in our U.S. workforce by 2020. We committed $300M to support this goal and accelerate diversity and inclusion.

Intel’s diversity reports commingle data about visa workers from Indian, China, and other Asian countries.

However, the MyVisaJobs.com site shows the company hires far more Indian visa workers that Chinese workers. For example, the site records the home countries of Intel employees who were nominated for green cards:

India (4989); China (355); Taiwan (111); Russia (102); Mexico (96); Canada (95); Bangladesh (81); Nigeria (64); South Korea (58); Costa Rica (57).

Indians comprised 83 percent of Intel’s 6,008 requests for green cards.

Many of these Indians are forced to wait many years for their green cards, essentially giving the company a growing workforce of bonded workers. The delay is caused by Fortune 500 companies that nominate many more Indians for green cards than can qualify each year.

This corporate policy has created a huge backlog of roughly 400,000 Indian workers who must work while waiting for 20 or more years to get the approvals.

These visa workers are particularly vulnerable because they cannot easily leave the company to seek new opportunities, and they cannot argue with their Indian managers or their U.S. executives for fear of being fired and losing their chance to become an American, said Lynn.

This enforced compliance — and the “bonded labor” — suppresses the meritocracy and diversity of American-style professionalism, said Lynn. In offices run by professional principles, “everyone can compete equally because there are rules to the game,” he said.

American professionals need to provide quality services to customers if they want to maintain their peer status and income. They are expected to openly argue the merits of technical proposals with their customers, their fellow professionals, and their own executives. If they disagree with their customer and employers, they are expected to quit and find another employer, perhaps at a higher salary.

But the roughly 1.3 million white collar visa workers face workplace pressures that are fundamentally different from the incentives that shape American professionals.

Visa workers have almost no workplace rights during their years in the United States. Even when they are skilled, they are bound to the hiring managers who have the legal power to cast them out of the United States and send them home to live in relative poverty. They cannot easily change jobs, partly because they want their employer to nominate them for the green card that will let them stay in the United States.

These circumstances ensure that visa workers — European, Indian, or Chinese — must go along with their hiring managers, especially if the hiring manager wants them to focus on less useful projects, to hide problems, or even pay kickbacks to the hiring managers.

But this workplace-rights problem is exacerbated when U.S. executives let Indian managers impose India’s workplace culture on their visa-worker subordinates, say Americans and immigrants.

That culture encourages Indian managers to sell jobs and promotions for cash and favors, and to hire people within their family and their ethnic networks. The culture also encourages the group to punish workers who reveal problems that embarrass the Indian group.

Many of Intel’s visa workers put their group interest above American employees, the duties of professionalism, and the company’s performance, a former Intel employee told Breitbart News.

“I was brought up that if you find an [technical problem] issue, raise it immediately,”  the American professional said, However, the rules are different in an office run by Indian managers, he said:

When you find a bug, don’t announce it [to your department colleagues]. Announce it to your [Indian] boss [because] they want to make sure it’s not their problem and not their bug. Don’t go through the normal process.

“One of the things that got me in the biggest trouble with the Indians was when I found a bug,” he said. “It was clearly our device causing the problem,” he said, adding that he described the problem via a department email. The Indian manager “became unglued … screamed at me in a conference room and called me the worst engineer,” he said. 

“I saw this over and over at Intel,” he said. “They’ll get somebody in [your department] and if you — God help you — if you make the mistake of questioning somebody[‘s judgment] … everybody else rallies around [the person] and [claims to] fix the issue. So it’s like, it’s effing unbelievable. It’s the most frustrating thing.”

U.S. managers allow the Indian managers to import their workplace culture in American companies, as long as deadlines and budgets are met, Americans tell Breitbart News.

Breitbart reported July 3:

A California state agency is recognizing the quiet spread of India’s ancient caste discrimination into America’s Fortune 500 professional workplaces.

“The California Department of Fair Employment and Housing (DFEH) filed a federal lawsuit today under Title VII of the Civil Rights Act of 1964 … against Cisco Systems, Inc. (Cisco) and two managers for discrimination, harassment, and retaliation,” said a June 30 press release. The press release continued:

“The lawsuit alleges that managers at Cisco’s San Jose headquarters campus, which employs a predominantly South Asian workforce, harassed, discriminated, and retaliated against an engineer because he is Dalit Indian, a population once known as the “untouchables” under India’s centuries-old caste system.

The lawsuit alleges that Complainant was expected to accept a caste hierarchy within the workplace where he held the lowest status within a team of higher-caste colleagues, receiving less pay, fewer opportunities, and other inferior terms and conditions of employment because of his religion, ancestry, national origin/ethnicity, and race/color.”

U.S. managers are now exploiting the Indian workplace culture to impose a similar top-down hierarchy on American professionals, one U.S. software expert told Breitbart. Using the name, “Nathaniel from New Mexico,” he  continued:

It is a culture in a lot of these [Fortune 500 Information Technology] shops where I work. That is because these [Indian] folks come in and they have their caste system, and upper management somehow has keyed into that, and the way that their H-1B [Indian-born] managers … treat their [H-1B] employees.

American upper managers think they can treat American employees the same way. American [professionals] know we speak our mind, we speak up when things are not right, we speak up when we think things are going good. But nowadays, if you speak out of turn, you’re [soon] filing for unemployment because they will find some nitpicking things about you to get you gone.

Intel’s employees praise and slam the company at anonymous ratings sites. “Great place to work,” said one current technical employee.  But a former chip designer in Portland, Oregon, claimed in March 2020 that “Intel is nothing more than a political freak show. Managers brazenly hire their relatives and friends to bolster their own empires.”

Around 2015, “I would go into a room of 30 people, and 15 to 17 of them are from India, and then the rest of them are the American citizens,” the former Intel employee told Breitbart News. But, he added, “most of the managers are becoming Indian in there, and it is very hard for an American to get hired.”

“Americans are culturally oblivious to this idea that something so Third World would be in the United States,” said Jay Palmer, a consultant who helps India’s mistreated visa workers to sue U.S.-based corporations. “I’ve had so many Indians tell me it is an Indian Mafia — they use those words.”

“If you substitute favoritism for merit, your customers will substitute your competitors’ product for your product,” said Lynn. “This is the risk Intel is running.”

“What made Silicon Valley great? It was ideas generated by a professional population,” Lynn said, adding:

As these companies have matured, and gained huge market shares, they have moved for being innovative to monopolistic. They are no longer looking to solve problems … they’ve chosen to place quarterly returns over innovations, and they have adopted this employment-visa model because they are only looking at quarterly profits …  Now they are hurting their long term viability by delivering flawed products.

 

Follow Neil Munro on Twitter @NeilMunroDC, or email the author at NMunro@Breitbart.com.