Population Research and Policy Review 20: 143–156, 2001.
© 2001 Kluwer Academic Publishers. Printed in the Netherlands.
The H-1B visa: Free market solutions for business and labor
JULIE R. WATTS
European Union Center of California, Scripps College, Claremont, California, USA
Abstract. The H-1B visa program opened the US information technology labor market to
temporary, skilled immigrant labor. But the immigrant worker was bound to a speciﬁc em-
ployer for the duration of the visa. The non-portability of the H-1B visa has beneﬁtted the
employer at the expense of immigrant and domestic workers. Much of the political debate sur-
rounding the H-1B program has focused on raising the annual visa cap based on inconclusive
evidence of a domestic IT labor shortage. The labor shortage question has obscured the more
important issue of reforming the H-1B program to level the playing ﬁeld between business
Keywords: H-1B visa, Immigration, Information technology, Labor supply and demand
The H-1B visa program, created as a channel to facilitate temporary, skilled
immigration to the United States, has become the center of a charged political
debate. This debate, between information technology (IT) industry executives
and H-1B foes, largely has focused on whether to increase the visa cap to alle-
viate what the industry describes as a shortage of domestic IT labor. I argue,
however, that this debate obscures fundamental ﬂaws in the H-1B program
that deserve greater attention. These ﬂaws privilege the IT industry at the
expense of H-1B holders and domestic IT workers, and should be remedied
to ensure that both business and labor abide by free market principles. The
employers’ ability to hire globally must be balanced by workers’ rights to
seek out better opportunities.
The H-1B program expands the labor supply of IT workers, but at the
same time restricts the ability of H-1B holders to compete in an open market.
Workers who hold H-1B visas are bound to a speciﬁc employer for the dur-
ation of their six-year visa. As a result, employers can abuse the program by
paying a salary often below market value. Moreover, this restriction indirectly
affects the wages and job security of domestic IT workers because employers
can threaten to replace them with cheaper, temporary immigrant labor.
In this article, I examine industry claims of a shortage of domestic IT
labor, as well as efforts to refute these claims by employee organizations,