Why U.S. Firms Favor H-1B Workers: Cost, Control, and Policy

(WASHINGTON, D.C.) U.S. firms are leaning on the H-1B visa system not mainly to bring in rare “genius” workers, but to cut labour costs and gain more control over staff, according to a blunt new assessment by Howard University professor Ronil Hira. His comments, given in a recent interview, come as the United States reassesses how it admits highly skilled foreign workers.

Purpose and original intent of H‑1B

The H‑1B category was set up for so‑called “specialty occupations” — jobs that usually need at least a bachelor’s degree in fields like technology, engineering, finance, research, and healthcare. In public debate, it has often been described as a channel for exceptional global talent, especially for the tech sector.

But Hira, a long‑time researcher on U.S. work‑visa policy, argues the on‑the‑ground reality looks very different. He says the program now operates as a tool for companies seeking cheaper and more compliant labour, rather than a narrow path for unique experts.

“The program is supposed to be about filling real skill gaps. Instead, it has turned into a system that lets firms lower wages and keep workers tied to them.”

Wages: the economic incentive

At the center of Hira’s critique is pay. Under U.S. rules, employers must attest they will pay H‑1B workers at least a required wage level. But:

• The required rates often fall below what comparable American workers earn in the same region and occupation.
• This gap creates a built‑in incentive for employers to hire foreign workers over local applicants.

Studies Hira cites show that, especially in information technology and outsourcing, some firms pay H‑1B staff up to 36% less than U.S. workers doing similar work. Even smaller differences add up when companies hire thousands across multiple offices.

Hira calls this wage structure a “no‑brainer” for employers under cost pressure, since it lowers salary expenses without technically breaking the law.

Employer control and worker dependence

Beyond wages, Hira contends control may matter even more. Key features:

• An H‑1B visa is tied to a single sponsoring employer.
• To change jobs, a worker usually needs a new petition (typically filed via Form I-129) and faces uncertainty about approval and timing.

This dependence creates powerful leverage for employers:

• Workers are reluctant to complain, negotiate aggressively, or leave for better offers.
• During layoffs or restructuring, H‑1B workers have only a short grace period to find a new sponsor or risk having to leave the country.

“When your right to stay in the United States depends on one employer, you’re not in a position to bargain as an equal.”

Hira argues this makes the H‑1B system behave less like a high‑skill immigration channel and more like a modern guest‑worker scheme — but without the stronger labour‑rights protections some guest‑worker programs include.

Who uses H‑1B and why

Silicon Valley and large tech employers are among the most active sponsors, supporting thousands of H‑1B workers each year. According to Hira, this reflects both:

• Genuine need for specialized skills in some cases; and
• The benefit to employers of a stable, compliant workforce less likely to leave, strike, or demand rapid pay hikes.

The political debate

There is a long‑running political fight over H‑1B:

• Business groups and many university leaders argue for more H‑1B slots to keep the U.S. competitive and fill roles U.S. graduates cannot supply in enough numbers.
• Worker advocates and some lawmakers say companies are using the program to replace U.S. employees with cheaper foreign labour — especially in routine tech and back‑office jobs.

Hira disputes the notion that most H‑1B roles are beyond the capability of local workers. He describes many positions as involving “ordinary skills” — basic software development, quality testing, or support services — work that requires technical knowledge but is widely taught.

This raises questions about how the government should define and police “specialty occupations.” If employers classify broad, mid‑level roles as specialty jobs and fill them with lower‑paid foreign workers, critics say the program drifts from Congress’s original intent.

Human stakes and workplace effects

Hira’s remarks highlight the personal consequences for many H‑1B holders:

• Many leave families, invest in U.S. degrees, and build lives in American cities hoping for a long‑term future.
• When their status depends on one employer, they can feel trapped — afraid to report unfair treatment, unpaid overtime, or stalled promotions.

Researchers have heard H‑1B workers describe staying silent when managers increase workloads or delay promised raises, fearing that complaining could end sponsorship and their ability to remain in the U.S. Hira says this quiet pressure is part of the program’s appeal to some companies, beyond the headline labour‑cost savings.

Demand, rules, and proposed reforms

Government data show continued high demand:

• The annual H‑1B quota for most new private‑sector workers is quickly oversubscribed each year, requiring a lottery to decide who can file a petition.
• The U.S. Citizenship and Immigration Services lays out the basic rules on its official H‑1B information page for “H-1B Specialty Occupations” and related categories, available on USCIS.

Critics like Hira argue formal rules and real‑world practice still differ widely. Proposed reforms include:

• Stricter wage rules to require employers to pay H‑1B workers closer to true market wages for their occupation and region.
• Easier job mobility so workers can switch employers without risking their right to stay in the country, thereby reducing employer leverage.

Business groups warn that too‑sharp tightening could push high‑skill jobs and investment out of the U.S. and into countries with more open work‑visa systems. They also note many H‑1B workers later become long‑term residents, startup founders, and innovators.

Conclusion: tension at the program’s core

Hira does not deny that some H‑1B workers are highly skilled and contribute significantly. However, he insists policy should reflect how the majority of positions are actually used — often to manage labour costs and worker dependence rather than to fill narrow, exceptional skill gaps.

For now, employer demand remains strong and the H‑1B visa continues to be a main legal path into the American job market for foreign professionals. As Congress and the White House debate broader immigration changes, lawmakers face pressure from both sides: companies claiming they need access to foreign talent, and workers warning they are being sidelined in favor of a more dependent, cheaper workforce.

The choices policymakers make will shape who benefits most from the H‑1B visa in years ahead — and whether the promise of “specialty occupations” will match the reality in American workplaces.