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September 1998, Volume 5, Number 9

Congress: H-1Bs, HIV, Haitians

H-1Bs. The H-1B compromise reached by Congressional Republican leaders in July 1998 was not considered by the US House of Representatives after the White House threatened to veto the compromise. The Senate approved a bill increasing the H-1B quota in May 1998, but it did not include the worker protection and training measures demanded by the White House.

A spokesman for the National Economic Council said that the Clinton administration was "willing to raise the cap (on H-1B visas) to address the skills shortage as long as we couple that with some training for American workers and provisions to make sure the program is not abused." John Fraser, acting administrator of DOL's wage and hour division, said "There's no way to explain to people how it is that U.S. employers can reach out to India or Bangladesh or China or any other foreign country without even trying to find a US worker to fill the job. And there's absolutely no way to explain to people why a US employer can fire or lay off US workers and replace them with foreign workers. That's just ill-conceived public policy."

An Intel vice president said that the probability of raising the H-1B quota in September has dropped below 50-50. However, in August, prominent California Democrats including Senator Barbara Boxer and Democratic gubernatorial nominee Lt. Gov. Gray Davis urged President Clinton to sign the Senate bill, which does not have the new worker protection standards.

There may be less industry interest in a higher H-1B cap because of a slowdown in high-tech tied to the Asian economic crisis. The management consulting firm of Challenger, Gray & Christmas reported that the high-tech industry laid off 51,000 workers in July 1998, the largest number in five years. Employment in electronic components manufacturing, which includes semiconductors, peaked at 681,000 in March 1998 and fell 9,000 from that level by June.

Under the compromise reached by Republican leaders, HR 3736, H-1B dependent employers--those whose work forces include 15 percent or more H-1B workers with less than a master's degree--must certify that they tried to recruit US workers and did not lay off US workers within the past 90 days to make room for the H-1B workers. Other US employers requesting H-1B workers would not have to make these certifications.

The Clinton administration threatened to veto the compromise bill unless worker protections were strengthened to reduce the threshold from 15 to 10 percent, to permit US workers who think that they were laid off to make room for H-1Bs to recover lost wages if they can prove their case, and to require employers requesting H-1B workers to pay $500 for each application or $1,000 for each H-1B worker admitted, not the $250 for each application in the compromise.

Economists associated with the Sloan Semiconductor Program at University of California/Berkeley reached the following conclusions: "To determine if there is currently a shortage of high-tech workers, we looked at their wage growth in the economy. If there is indeed a labor shortage, we would expect to see earnings of high-tech workers increase more rapidly than earnings of other workers. This did not happen. Although average earnings for engineers have increased over the last ten years, we find that the increased earnings for engineers have not been transmitted fully to the more experienced workers. In addition, we find that high-tech engineers and managers have experienced lower wage growth than their counterparts. This is strong evidence against the existence of a labor shortage."

Since the H1-B program began in 1991, the Labor Department has received about 300 complaints. In 91 cases, investigators concluded that companies owed almost $2.3 million in back wages and assessed about $215,000 in penalties. "Job contractors" or "job shops" are the most frequent users and abusers of H1-B workers in high-tech fields.

HIV/AIDS. The case of a 56-year old New Zealand man with AIDS highlighted US policies on the payment of Social Security benefits to green-card holders overseas. The man worked 30 years in the US, but traveled frequently, and was out of the US too much to qualify for naturalization. He got AIDS in 1994, and began receiving $680 a month in Social Security benefits. He returned to New Zealand, but the Social Security Administration would not mail his monthly benefit check to New Zealand because New Zealand has no reciprocal agreement to pay pension benefits to its citizens permanently residing in the US.

Social Security requires overseas beneficiaries to spend a month in the United States every six months, which this man could not do because foreigners with AIDS are barred from the US.

Doctors. Some 22,000 of the 104,000 medical residents training in US hospitals are non-US citizens and one-fourth of the 600,000 US doctors were born abroad. Foreign-born doctors must pass an exam given in English, obtain a visa to come to the US for residency training, and then about 1,000 physicians a year are permitted to remain in the US if they agree to work for at least three years in medically underserved areas.

The American Medical Association has proposed legislation that would reduce the number of residency training slots available to foreign doctors.

Caribbean. Florida is closer to the capitals of 16 other countries than it is to Washington, D.C. The Florida state government, aware that the state is vulnerable to immigration pressures, has launched a series of projects to ease them.

Florida has sponsored $533,000 of "preventive diplomacy" projects in Haiti, 700 miles south, that range from cancer prevention and treatment programs to clean well-water projects and disaster-preparedness training--the state is seeking to prevent new waves of migrants from coming ashore, and thus ease anti-immigrant fears in Florida. Florida has a Florida International Volunteer Corps that has sent experts to 20 Caribbean and Central American nations.

There is reported to be an upsurge of Haitians reaching Florida in summer 1998; an estimated 1,500 have reached Florida in smugglers' boats. Many depart from Freeport, Bahamas, 50 miles from Florida, paying a fare of $3,000 a person, up from $300 two years ago. In mid-August, a 33-foot boat with 38 Haitians hit a sandbar and two Haitians drowned trying to swim to shore. One person said that there were so many boats shuttling between Freeport and West Palm Beach that: "It's like there is a bus service now between here and Florida."

About 40,000 Haitians live in the Bahamas, including 10,000 in Freeport--the Bahamas has 280,000 residents. Many Haitians obtain tourist visas, arrive in the Bahamas and make contact with smugglers in Freeport. Some work in the Freeport area while awaiting a chance to go to Florida. One Haitian who is now a legal US immigrant recently returned with a video camera to record his passage to the US.

In 1994, some 48,000 Haitians were intercepted at sea while trying to come to the United States.


E.A. Torriero and Merle Augustin, "Smuggling of Haitians surges," Sun Sentinel, August 16, 1998. Mike Clary, "Florida Sees Domestic Issues as Foreign Affairs," Los Angeles Times, August 13, 1998. Stuart Silverstein, " A New Era of Job Cuts Hits High-Tech Firms," Los Angeles Times, August 7, 1998. Louis Freedberg, "Congress Can't Jibe On Extra Tech Visas," San Francisco Chronicle, August 7, 1998. Majorie Valbrun, "Florida Is Working in Islands to Prevent Flow of Migrants," Wall Street Journal, July 27, 1998.