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H-1B workers are better paid, more educated, study finds

Patrick Thibodeau | Feb. 6, 2012
H-1B workers are better educated than U.S. born workers and earn more, according to a new study by an independent research group.

H-1B workers are better educated than U.S. born workers and earn more, according to a new study by an independent research group.

The report by two economists at the non-partisan Public Policy Institute of California, also found that, on average, H-1B workers are about 10 years younger than U.S. born workers.

The report's findings concerning pay indirectly challenge beliefs about the H-1B program held by backers like Alan Greenspan, former chairman of the Federal Reserve.

In a recent column in the Financial Times , Greenspan argued that restrictions on the H-1B program protect "many high earners from skilled migrant competitors." He called the H-1B program "a subsidy for the wealthy," meaning well-paid IT workers.

Greenspan has previously called for raising the visa cap.

But according to this study, Greenspan conclusion U.S. IT workers are a " privileged elite is wrong." It found that the average annual earnings of H-1B workers are about 10% higher than the average annual earnings of U.S. workers, after adjustments for age, occupation and education.

The study is drawing reaction from those who see current H-1B policies as a detriment to U.S. workers.

The research may also underscore arguments made by H1-B opponents despite their criticism of the findings, particularly in regard to age. The study found that average age of H-1B workers are 30.6-years-old versus 40.6 for U.S. born IT workers.

In his newsletter, Norman Matloff, a professor of computer science at the University of California at Davis and a longtime critic of the H-1B program, wrote a detailed response in two parts ( Part One and two ).

On the issue of age discrimination, Matloff believes the H-1B visa plays a paramount role with employers looking to save money by hiring younger, "thus cheaper, H-1Bs, instead of older, thus more expensive Americans."

The study didn't look at some of the broader H1-B issues, such as the types of companies, including offshore outsourcing companies, that use them. President Barack Obama weighed in on that issue this week, at least indirectly, when he said the visa "should be reserved only for those companies that say they cannot find somebody in that particular field."

The study by Magnus Lofstrom and Joseph Hayes does combines data gathered through Freedom of Information Act requests to the U.S. Citizenship and Immigration Service and the U.S. Census to paint its picture of H-1B workers.

The researchers got individual level data from USCIS that included occupation, industry, education, age and annual earnings collected off the I-129 form.

They assembled data about U.S. workers from the U.S. Census American Community Survey, which is based on a sample of 1% of the U.S. population.


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