Senate Hearing Expert: Guest Worker Program Could Deter Students from Tech Fields

Fewer students could enter the tech field as companies manipulate guest worker programs to drive down wages, Ron Hira, associate professor of public policy at Howard University, testified Thursday before a Senate subcommittee hearing examining the impact of the H-1B visa program.

“When you intervene with guest worker programs you’re intervening in that normal labor market to education market signal,” Hira said Thursday before the Senate Subcommittee on Immigration and the National Interest.

“And that pricing signal is very, very important,” he continued. “People will, students will, vote with their feet, they’re going to move into fields that they believe are going to be good careers. And so I think that we should be very concerned about that.”

Hira further warned that such intervention impacts not only future would-be American tech workers but also current tech employees.

“There is another set of workers that is really important and often overlooked and that’s the incumbent workers,” he said. “When a company can go to a cheaper H-1B worker they are going to be less likely to invest in workforce development of their current workers.”

Sen. Jeff Sessions (R-AL), the subcommittee chairman, further pressed Hira on the other unseen advantages companies achieve with foreign guest workers — including worrying about retirement, certain medical and retirement benefits, and salary promotions. Hira said:

There is definitely calculations going on in terms of age and age plays a role in terms of benefit costs to the company, as well as mobility. A young person in their 20s can be moved from client to client all around the country much more easily than somebody in their 40s. And so what you see is that even these wages that we’re talking about, in terms of the wage differentials, they actually understate how much cheaper the H-1B workers are to the employer.

Hira noted that the program also has detriments for foreign workers.

“Also their H-1B workers are captive in a lot of ways to that employer. So they are indentured in a lot of ways. They do not have a lot of mobility and bargaining power that an American worker would have.”