US think tank wants H1B cap raised to 195,000

April 8th, 2009 - 10:54 am ICT by IANS  

By Arun Kumar
Washington, April 8 (IANS) Debunking the myth that H-1B visas steal American jobs, a US think tank has asked the Congress to instead raise the cap on them to promote economic growth and generate much needed tax revenue.

Congress must raise the cap on H-1B visas coveted by Indian techies back to 195,000 visas per year - the maximum allowed as recently as 2001 - from the current 65,000, The Heritage Foundation analysts Jena Baker McNeill and Diem Nguyen said Tuesday.

“Raising the cap for H-1B visas will not steal American jobs but will help promote economic growth and generate much needed tax revenue,” they said, calling the notion a “popular myth”.

“There is a popular myth that H-1B workers displace Americans because foreigners will work for less than Americans even if they have greater qualifications.”

This notion is so widespread that Congress recently passed an amendment barring companies receiving bailout money from hiring H-1B employees “but this notion is entirely false”, McNeill and Diem said.

The researchers cited a survey by the National Foundation for American Policy to show that 65 percent of high-tech companies employed people outside the US due to their inability to obtain H-1B visas.

In reality, H-1B visas spur economic growth, they said. As shown by the survey on average, for every H-1B employee hired, an additional five American employees were also hired.

If Congress were to increase the H-1B cap to 195,000 visas, the US government would receive an additional $2 billion of tax revenue each year, the two researchers said.

Noting that as the US economy fluctuates through its business cycles, the demand for H-1B visas will rise and fall, McNeill and Diem suggested making the cap flexible.

Congress should establish a quota that, if met, automatically increases for the next year. In addition, unused visas should be recaptured for the next fiscal year.

“Allowing the appropriate levels of high skilled workers into the United States helps the American worker, the economy, and America’s federal budget,” they said. “There is no good reason not to act.”

Congress has failed to raise H-1B caps for several years despite the wide range of support to do so, they said. “Raising H-1B caps will provide businesses the professionals and skills they need to develop their business when ready.”

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