New H-1B Visa Bill to Double Minimum Wage

A legislation has been introduced which among other things calls for more than doubling the minimum salary of H-1B Visa holders to $130k (currently set at $60k). Foreigners at large tech firms were underpaid relative to their American counterparts as companies exploited the broken system for years.

My question - how does this impact international college students that are sponsored to work in "low" paying jobs (i.e., Big 4 Audit where the starting all-in comp is under $60k)? I can see this leading to a major shift in recruiting / thousands of rescinded job offers.

Thoughts?

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Comments (91)

Jan 31, 2017

thank god my foreign buddies were smart enough to break into PE before the exodus

that being said Trump is an American president and will serve the interests of Americans. It's a pity though because immigrants from my experience work much harder, but they aren't children of Uncle Sam

What concert costs 45 cents? 50 Cent feat. Nickelback.

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Feb 1, 2017

This bill is to curtail the number of jobs filled by those requiring work visas. The thought being that it will lead to jobs being filled in cases only where an American cannot fill it---the steep pay is mean to be a deterrant to companies to see how much they really want to hire an international worker. As you said, this will result in a significant shift away from international hires--what it won't do is make jobs that used to be $65,000 jobs $130,000 jobs. I don't agree with this policy but the intent is pretty clear.

One thing that's interesting is that at the MBA associate level, associates currently start out at $125,000 for the stub year (before it rises to $150,000, which is under the threshold. I'd guess most banks would bump this up the $5k to be compliant and reduce the stub or signing bonus, rather than eliminating hiring international students, but it's worth monitoring.

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Feb 1, 2017

H1B application goes in during spring, so associates would be over that threshold at that point.

Feb 1, 2017

Good news. 2nd year analyst salary (for everyone with an MS) will go to $130K.

The congresswoman from CA is a shrewd lady.

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Feb 1, 2017

Just an observation, please correct if I'm wrong. H1b biggest drawback is the lottery system where employers cannot be certain if international students can obtain a Visa after getting the offer. Many do not hire non-US workers as a result. If minimum wage is raised to 130k, doesn't it make hiring international undergrad impossible now coz no positions pay 130k base first year? If so, the number of applicants for the Visa drops a lot from today's level, and assuming the space available remains relatively flat, doesn't it make post-MBA PE positions open for non-US MBA students? Since obtaining a Visa for high-paying job is almost guaranteed now. Last time I checked, post-MBA PE comp is above the new floor limit.

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Feb 1, 2017

I agree. If this goes through I think the US is about to lose a lot of talent. The tech giants like Apple/Google/Microsoft may be able to raise wages for top undergrads (whether they will is another question entirely), but I doubt other firms will be able to follow.

Post MBA positions may be more attractive for people that can get into a school that pretty much guarantees a salary above the 130K minimum, but grad school for other fields will become entirely unattractive to internationals.

I made around 100K for salary+bonus first year out of college - over three times the median personal income in the US. It's weird that the government thinks being so much higher/more productive than the median person is "not good enough" to warrant a work Visa. If this passes I think it'll be a huge mistake - all the talented internationals will just find a new country to go to.

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Feb 1, 2017
econecon101:

I agree. If this goes through I think the US is about to lose a lot of talent. The tech giants like Apple/Google/Microsoft may be able to raise wages for top undergrads (whether they will is another question entirely), but I doubt other firms will be able to follow.

Post MBA positions may be more attractive for people that can get into a school that pretty much guarantees a salary above the 130K minimum, but grad school for other fields will become entirely unattractive to internationals.

I made around 100K for salary+bonus first year out of college - over three times the median personal income in the US. It's weird that the government thinks being so much higher/more productive than the median person is "not good enough" to warrant a work Visa. If this passes I think it'll be a huge mistake - all the talented internationals will just find a new country to go to.

And we still have moronic socialists on this forum who are attempting to justify their protectionist delusions.

The world is a marketplace, and countries with the most freedom will be the ones who experience the most success. Up until now, that has been the U.S. but there is no reason that this must remain the case; there are plenty of other countries striving to take the United States's position in the world.

Oh well. People voted for this and they will face the benefits and consequences of their decision.

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Feb 1, 2017

We'll take the tech talent don't worry, wouldn't want them "taking" American jobs.

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Feb 1, 2017

Wow, you clearly have no idea how the foreign worker program in Canada works do you? Kind of sad considering you claim to be a Canadian. It is far more difficulty for Canadian firms to hire foreign workers than it will be fore American firms even if this passes.

Follow the shit your fellow monkeys say @shitWSOsays

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Feb 1, 2017

Wow, it's pretty sad you think that my comment is some how associated with the actual policy of the Canadian Federal Government. Congrats on the beautiful straw man you built.

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Feb 1, 2017

Well you made an authoritative statement, would be nice if you actually understood the policy that went behind your easily debunked statement.

Follow the shit your fellow monkeys say @shitWSOsays

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Feb 1, 2017

I made a statement that Canada will gladly take the tech talent ie. tech firms in Ontario are begging for the talent. I never stated that the Canadian Federal Government will allow the tech talent to enter. Important distinction, but you can keep reaching further and further if you'd like. You're obviously not Canadian otherwise you'd know that the will of the people is, in most cases, not the will of the government.

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Feb 1, 2017

Your last sentence proves nothing because that is the case in pretty much every country on the planet. However, your evasion still doesn't prove your statement. You made an authoritative statement that Canadian companies would be sucking up all of this talent easily when that is not the case. Even with new restrictions on the HB-1 program foreign workers would have a far better chance of landing a job in the USA than in Canada. Go ahead and look at the rules.

Follow the shit your fellow monkeys say @shitWSOsays

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Feb 1, 2017

Lol you're really butt hurt eh? It's a one off comment on a forum, and you want to delve into the nuance of Canadian Foreign Labour Policy. Definitely not a straw man.

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Feb 1, 2017

Can you take all the refugees as well? Thanks!

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Feb 1, 2017
econecon101:

I agree. If this goes through I think the US is about to lose a lot of talent. The tech giants like Apple/Google/Microsoft may be able to raise wages for top undergrads (whether they will is another question entirely), but I doubt other firms will be able to follow.

Post MBA positions may be more attractive for people that can get into a school that pretty much guarantees a salary above the 130K minimum, but grad school for other fields will become entirely unattractive to internationals.

I made around 100K for salary+bonus first year out of college - over three times the median personal income in the US. It's weird that the government thinks being so much higher/more productive than the median person is "not good enough" to warrant a work Visa. If this passes I think it'll be a huge mistake - all the talented internationals will just find a new country to go to.

Talented how, though? In my experience, top decile programmers can earn $130K pretty easy and they have 5-10x the productivity of a median developer. (I say this as a top 20%, not top 5% programmer). I argue the same holds in finance, and I also argue that salaries will get pushed up towards this $130K figure. Bad news for google, good news for workers.

$130K is pretty steep-- I'd rather see $100K phased in over a few years or maybe have us get to $130K over six or seven, with a 20% reduction in the required salary for people in rural communities where the community signs up for an exemption. But I'd argue the US is still going to get the top decile under this policy.

I'm not saying it's fair, but we have to be honest here. The dude who can design and build a fusion reactor in a semi-trailer for Lockheed is still going to get a job here. The dude who can rewrite all of Morgan Stanley's corporate bond analytics code when he gets bored some weekend is still going to get a job here. The guy making seven figures trading options out of his dorm room will still be ok. The other 90% of us (including me) wouldn't be able to. But we're not necessarily make-or-break for a country's economy. We're good productive people who can take care of ourselves whatever the circumstances (including working in our country of origin), but we're not quite as indispensible as we think we are.

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Feb 1, 2017

This isn't aimed at finance, it is aimed at the big tech firms who are exploiting the system to hire techs at 60k when the going rate for the same tech from America is 80k.
To clarify, there are a surplus of people who meet the talent, education, and experience required for these positions but the big tech firms are hiring foreign workers for the express reason of saving money on their employee expenses. The idea that America would be the only country in the western world that has protectionism for its citizens in regards to employment would be a laughably naive position to take.

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Feb 3, 2017

Correction: the big tech consulting firms that act as body shops. Big tech companies hire in internationals at market rate, which is pretty substantial at the moment.

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Feb 1, 2017

Good old intervention...

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Feb 1, 2017

As an international student with a SA IBD offer (and have friends with FT offers), how should I address these concerns to HR? I am from a EU country, and hope to be proactive with this, even though there's not much I can do. I would really appreciate any advice - if anyone has experience dealing with work authorization, etc.

Feb 1, 2017

Well, naturalize quickly. Unfortunately, that is easier said than done.

Feb 2, 2017

Yup, the naturalization process is not quick and can take up to 3 years. That said, this is only legislation that has been introduced in the House, there is no telling if and how long it will take to pass on to the Senate and Trump.

Gimme the loot

Feb 1, 2017

But I thought the 130K number was base salary + bonus number? In that case at least, 1st year analyst may be able to satisfy the hurdle. And for now, the hurdle seems to apply only to "dependent" employers, in which more than 15% of its employees are internationals. I'd doubt this would apply to BBs...

Feb 1, 2017

130k is for base salary, same as with the current 60k. I have not read about dependent employers only and not to BB. A few EBs in some instances outright told offer holders that they could not sponsor even though they're clearly not "dependent".

Feb 1, 2017

I think those EBs just don't sponsor at all in the first place. Moelis doesn't sponsor at all, when I went through the process I found this out the hard way. According to my firm's immigration lawyer, $130k is not a 'minimum' wage, but a threshold wage at which H1B employees are considered "exempt". I think employers can still pay H1B workers a prevailing wage. Employers who have a certain amount of H1B workers (15% for a firm with more than 51 employees) are H1B 'dependent' employers and it is much harder for them to displace American workers and must make an extra effort to hire domestic workers (advertise first in the US). If they pay the foreign employee above the proposed exempt wage of $130k, the H1B workers are considered "exempt" H1b non-immigrants and will not be counted as part of the firm's H1B statistics.

Also, the proposed bill has a clause to allocate 20% of visas to small businesses like startups, and I'm not sure how they'd pay $130k to all employees if it wasn't the above condition. This bill is worrying for me of course, though there is a clause that aims to build a bridge between F1 student status and green card status, though it's not clear how this will be accomplished. I'm not a lawyer, but this is what I am being told. Still very worrying, I am trying to be proactive on my end

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Feb 1, 2017

+SB for the facts./

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Feb 1, 2017

It is incredibly stupid to send back ambitious foreigners who are educated by elite US schools or refuse those educated at top foreign schools who will now build up their own economies instead of America's.

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Feb 1, 2017

Why is everybody attributing this bill to Trump? It was introduced by a Democrat.

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Feb 1, 2017
thurnis haley:

Why is everybody attributing this bill to Trump? It was introduced by a Democrat.

I only saw one mention of Trump in this thread.

Unfortunately, protectionist ideology is not isolated to a single individual.

Feb 1, 2017

Alternative facts, bro

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Feb 1, 2017

The idea that you couldn't find all lower and mid level employees domestically is absolutely mind boggling given our current un- and under-employment levels. Are there jobs you couldn't fill through the domestic labor pool? No doubt, but they should have been high paying anyway. If anything this would force employers to not take advantage of them. Surprising that low and mid level internationals wouldn't like this idea.

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Feb 1, 2017

The point is that there will dramatically fewer "low and mid level internationals", because there won't be an opportunity for most of them to start in the US out of undergrad.

Feb 1, 2017

Did you even read my post before throwing shit? That's literally the whole point. It would price internationals out from easy to fill positions (ie "low" pay) and force domestic hiring. I said (albeit sarcastically) I knew given the demos on this site that butts would be hurt by this.

Feb 1, 2017

I didn't throw the shit, and tech jobs aren't "easy to fill". There aren't enough qualified tech employees in today's market which is why almost all the major tech companies are always hiring, and if this were to go through, there would be even fewer.

Talk to a couple people in the tech industry, but it's honestly necessary to pull software engineers from across the planet. There are more people in the tech industry than ever before, yet there is still a massive pay discrepancy in tech (people making 60k vs 250k out of undergrad). Talent is hard to find

Feb 1, 2017

Doesn't that greatly help me as a Canadian looking at NYC after my undergrad? My understanding is Canadians can get in using the TN Visa (economist-ish) under NAFTA meaning Canadians would be the only internationals eligible for analyst positions.

That is unless Trump scraps NAFTA altogether...

Feb 1, 2017

Can somewhat speak to this as I'm currently working based on a TN1 Visa in another industry. You're correct if Trump doesn't scrap NAFTA (still up for debate) it makes Canada in particular more competitive relative to other countries. From my experience smaller firms do not want to bother / do not feel comfortable with Visa sponsorship when they have candidates at their doorstep though. All things equal, why would they bother, right? For the extra expense/hassle you'll have to be an exceptional candidate.

Another thing for you to personally consider is that the TN1 Visa does not offer a path to citizenship under any circumstance. The H1B does. TN1 does get you into the country, although it isn't a comfortable feeling to think if your company fires you that you also have to leave the country immediately.

Feb 1, 2017

.

Feb 1, 2017

Haha, again you're somewhat correct but a bit too simplified. A firm needs to sponsor or petition for your Visa (the company sends this to DHS ahead of time) and you basically show up with your paperwork (Degree, letters of reference, resume, employment contract, etc.), get pulled into a side room and asked basic questions for 30 minutes, then you're either instantly approved or rejected. No real wait time.

The H1B Visa is dual-intent (intent to work + intent to immigrate). The TN1 Visa is a single intent (work) with no immigration intent. You actually have to prove you have significant ties in Canada that will make you want to come back (Ie. family, house, mortgage payment, whatever). Why would someone claiming you have no intent to immigrate then be allowed to concurrently apply for an H1B that is stating the complete opposite? Doesn't make sense and I was actually warned against it. The only way I see your hypothetical working is if you were to time the expiration of your TN1 Visa (max 3 years before renewal) with your sponsoring company, go on a month vacation while they process paperwork, and be able to re-enter with H1B.

I sound like a lawyer right now. Promise I'm not. But I do think what you read is misleading.

Feb 1, 2017

Thank you very much for the detailed reply. I do have one question that you may be able to answer, since you do seem to be very knowledgeable about the subject. Could you work on your TN1 Visa for two or three years and sign up for an MBA after?

Feb 1, 2017

Nothing prevents you from doing so (to my knowledge), but recognize these are two separate issues. The TN1 (work-only) Visa will allow you to work, not in itself allow you to sign up for an educational program. For education (undergrad or MBA) you'd want the F1 Visa.

Feb 1, 2017
qzatti:

Doesn't that greatly help me as a Canadian looking at NYC after my undergrad? My understanding is Canadians can get in using the TN Visa (economist-ish) under NAFTA meaning Canadians would be the only internationals eligible for analyst positions.

That is unless Trump scraps NAFTA altogether...

"They're sending people that have lots of tar sands, and they're bringing those tar sands to us. They're bringing natural gas. They're bringing timber. They're hunters. And some, I assume, like warm weather!"

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Feb 1, 2017

To paraphase a world leader, this bill is "wrong." The negative impact of closing our borders may be subtle at first, but over a generation we will see the rotten fruits of this counterproductive, protectionist legislation.

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Feb 1, 2017
Synergy_or_Syzygy:

To paraphase a world leader, this bill is "wrong." The negative impact of closing our borders may be subtle at first, but over a generation we will see the rotten fruits of this counterproductive, protectionist legislation.

We did the same thing in the 1920s. 30 years later, it was the 1950s and the US economy was booming.

Furthermore, the very best and brightest-- those who can earn over $130K/year-- are still welcome here under this legislation. This 5% probably accounts for half of all H1B productivity.

The rest of the world is going to be unhappy that the US is doing this. But India acts in the best interests of their citizens and plays the mercantilist game-- they exempt technology businesses from taxes. Japan does it-- they give their automakers an export credit. Dubai does it-- they even have a caste system with Emiratis on the top, Americans and Europeans in the middle, and Indians on the bottom. China's culture excludes Americans and other westerners even if they speak perfect Mandarin. Not to mention all of the dumping. It is no surprise that the rest of the world would loudly complain if we try to do the same thing. But every country that is complaining about US mercantilism is being totally hypocritical. How about you get rid of your export subsidies and tax exemptions and we'll talk?

My take is that we don't want to disrupt peoples' lives and make them hate us for a generation, but we ought to start acting in the best interests of our citizens. That means pursuing free trade with countries that play fair (Canada, UK, Northern Europe, Australia, New Zealand, Israel, maybe South Korea) and having more mercantilist policies towards countries that don't.

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Feb 1, 2017

Whataboutism aside, we are supposed to be leading the way, you know, shining city on the hill? If India, Dubai, China, etc. turn inward, our best weapon of counterattack is to literally import their best and brightest, or at the very least, their very good and bright. America has plenty of space for talent to thrive.

Ramping up legal immigration would also work positively toward making America more inwardly self-sufficient, a goal which I see many here espousing. I'm on board - let's onshore manufacturing, balance our economy, become more competitive. What I do not believe in is drawing a line in 2017 and saying, "Okay, everyone who came in before is a 'true American,' and we don't need anyone else." Patently absurd.

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Feb 1, 2017

Whattaboutism aside, we are supposed to be leading the way, you know, shining city on the hill? If India, Dubai, China, etc. turn inward, our best weapon of counterattack is to literally import their best and brightest, or at the very least, their very good and bright. America has plenty of space for talent to thrive.

We're still going to import their best and brightest; just not their very good and bright. Top 5%; not top 20%.

Ramping up legal immigration would also work positively toward making America more inwardly self-sufficient, a goal which I see many here espousing. I'm on board - let's onshore manufacturing, balance our economy, become more competitive. What I do not believe in is drawing a line in 2017 and saying, "Okay, everyone who came in before is a 'true American,' and we don't need anyone else." Patently absurd.

I agree, and America has gone through phases in immigration policy. We had a lot of immigrants from 1840-1920. Then Congress moved to curtail it. During the postwar boom from 1950-1970-- the greatest growth period the US had seen, only about 4-6% of the population was immigrant. Today the figure stands at 14%. (I am not arguing that a lack of immigrants helped-- just providing a counterexample to the claim that having 1/8 of the country be immigrant is a necessity to strong economic growth)

And the question is whether and how quickly the US can absorb these immigrants into our culture, and also whether a cultural melting pot of Eastern and Western Europe along with China can still work if you throw in the Middle East, or if some of the different reagents might react dangerously with each other unless you slow down the process a bit.

I don't believe in drawing a line after 2017 and slamming the door, but I believe in reducing immigration a bit, curbing abuses (eg Infosys), and focusing on higher wage earners.

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Feb 1, 2017

I respect your opinion and appreciate the polite and spirited debate. I think we agree more than we disagree, at this point it's an argument about where to draw the line. Top 20% (top quintile) is considered pretty great performance in the hedge fund world, is it not? What would be the consequence of, to make an analogy, America losing the funds that perform in the top 5-20%?

Feb 1, 2017
Synergy_or_Syzygy:

I respect your opinion and appreciate the polite and spirited debate. I think we agree more than we disagree, at this point it's an argument about where to draw the line.

Top 20% (top quintile) is considered pretty great performance in the hedge fund world, is it not? What would be the consequence of, to make an analogy, America losing the funds that perform in the top 5-20%?

I'm not sure. Is the framing on this is that immigrants are better and brighter than all or nearly all Americans and then saying they're 20% of the population by putting them at the top end of this distribution? I'm not sure I buy that. I was born in the US; I think I'm probably a better contributor to the economy than some (not all) immigrants and that there are many other US citizens like me. Are the best funds based on ex-ante averaged factor-adjusted returns or ex-post results?

Furthermore, the way it works in the hedge fund world (and often in VC too) is that the best funds (and this is a single digit number) attract a point mass of capital and ultimately get something like 50% of the total CAR.

There's a lot of different ways to look at this. Again, my hunch is that 20% of workers with H1B visas do 80% of the work. And while it's not entirely fair to immigrants, some immigrants compete with some Americans for jobs, and the US's fiduciary duty is to its citizens. I favor a gradual phase-in of higher minimum salaries for H1Bs, as well as a gradual constraining of student visas. The H1B constraint is easy-- salaries. For student visas, you could have an entrance exam or quotas by school. The goal is to implement a policy that provides for a gradual stabilization of US culture and executes the country's fiduciary duty to its citizens better without leaving any existing immigrants in the lurch.

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Feb 1, 2017

The following is purely my opinion, and admittedly very biased by my experience as a former expatriate in another country and the husband to an immigrant.

The rough framing is that the top 20% of immigrants are deserving, in my opinion, of a swift path to citizenship and should compete on an equal playing field with existing American citizens. I was born in the US, my grandparents were not. My wife was not. The notion we should clamp the spigot of talent incoming to the USA just as other emerging economies such as India and China are rapidly becoming more talented and competitive is counter-intuitive to me. Again, I know this opinion is unpopular, but if I had the choice between halving or doubling the number of green cards / immigrants, I would double. If it were quartering or quadrupling, I would quadruple.

If we are making a factor performance analogy, legal skilled immigrants are the value play and profitable to the country from a net burden on taxpayer perspective. Adjusted for their human capital inputs, immigrants outperform and have huge upside if they raise their children in the USA (these kids grow up highly educated and are a huge net benefit to society). Does this dilute the existing shareholders of US Citizenship? Yes. Unquestionably. But the upside is, to extend our analogy to death, having that minority stake activist investor which puts the needed pressure on existing shareholders to improve value.

For what it is worth, I also favor swift processing and if necessary, deportation of all illegal immigrants. We have a large low-skill employment gap for existing American citizens, and illegal immigrants completely unfairly tilt the playing field and are not vetted by the system. Legitimize them or kick them out, but the status quo is untenable.

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Feb 1, 2017

That totally depends on how that quintile stacks up against the rest of the population. There are plenty of places on earth where the top 20% would barely tread water with the bottom 20% in America. The question is relative, you can't just draw a percentage line.

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Nov 26, 2017

nvmd

"Work ethic, work ethic" - Vince Vaughn
Feb 1, 2017

so your argument is that backwoods countries like the UAE and India (where rape laws are lax and their caste system still pervades their entire economy) and the nationalistic Japanese (who could use some immigration to spur growth and burgeon a populous that will soon hit a retirement wall) are protectionist so we should be too? Your argument is that maybe if we have a 3rd world war maybe we can have a boom like the 50s? Man, people are really drinking this protectionist Kool-Aid. No issue with questioning the protectionist policies of other countries but do we not do the same with certain industries? Since America embraced free trade, almost every other country in the world has gone in the same direction, we are leaders not followers. So if (or when) we go protectionist, the world will follow, and we will all suffer (some more so than others) as a result.

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Feb 1, 2017
BobTheBaker:

so your argument is that backwoods countries like the UAE and India (where rape laws are lax and their caste system still pervades their entire economy) and the nationalistic Japanese (who could use some immigration to spur growth and burgeon a populous that will soon hit a retirement wall) are protectionist so we should be too?

Yes. What's good for the goose is good for the gander.

I think we should be more gentle with our allies and countries that don't engage in this. But India, China, and Singapore (not South Korea, and as an ally we should give Japan the opportunity to terminate its export credits before cutting them off) are all fair game.

Your argument is that maybe if we have a 3rd world war maybe we can have a boom like the 50s? Man, people are really drinking this protectionist Kool-Aid. No issue with questioning the protectionist policies of other countries but do we not do the same with certain industries?

No, my point is merely that the boom happened in spite of the fact that we had very few foreigners.

Since America embraced free trade, almost every other country in the world has gone in the same direction, we are leaders not followers.

And leading has gotten pretty darned expensive and we're not getting anything for it.

So if (or when) we go protectionist, the world will follow, and we will all suffer (some more so than others) as a result.

Many countries in the world are already protectionist. What's good for the goose is good for the gander and they have no moral high horse to sit on.

I support free trade and even free movement of people with Canada, the UK, Australia, and New Zealand. Similar cultures and economies, and no mercantilist policies. (You'll notice I left out Ireland and its corporate tax mercantilism) I don't support us getting taken advantage of by mercantilism. The US is going to stop giving away its trade bargaining chips for free.

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Feb 1, 2017

1.) please leave culture out of this, America's culture is a culture of multiculturalism, lets discuss economics, conversations on culture are based in emotion.
2.) Why are you conflating protectionist trade policies with immigration policy? We are discussing the validity of heavily limiting legal immigration, I am not really concerned with what Japan does with tax credits when having this conversation (as far as what they've done with legal immigration, most would agree it has been a failure and it is a drag on their aging economy).
3.) Since we are on protectionist trade policy, you didn't answer my question regarding the reality that the U.S. engages in its own industry protectionism.
4.) I get your point on the boom, but we needed a world war and women flooding into the work-force to make that happen. Since women are already in the work-force and (hopefully) we are not going into another world war, idk how the 50s is a relevant case-study moving forward.
5.) Your argument that many countries in the world are already protectionist is fair but, again, may not be relevant to how we should behave. The question is, will protectionism lead to optimal economic outcomes for our nation? How much has protectionism helped these protectionist economies vs. hurt them? Would China be growing at 13% instead of 8% if it were more liberal with its policies on foreign investment and more liberal with its trade policy? That is a question that deserves answering before we go off the protectionist deep end.

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Feb 1, 2017
BobTheBaker:

1.) please leave culture out of this, America's culture is a culture of multiculturalism, lets discuss economics, conversations on culture are based in emotion.

America's culture is a culture of law, liberty, and free speech. It is a country where people don't riot because someone rips up or burns a book.

2.) Why are you conflating protectionist trade policies with immigration policy? We are discussing the validity of heavily limiting legal immigration, I am not really concerned with what Japan does with tax credits when having this conversation (as far as what they've done with legal immigration, most would agree it has been a failure and it is a drag on their aging economy)

Same concept. Which people and what businesses have access to our country's markets and consumer economies? You may be a democrat, but as someone who understands how businesses work, businesses and people look pretty similar in the context of trade and the flow of goods.

3.) Since we are on protectionist trade policy, you didn't answer my question regarding the reality that the U.S. engages in its own industry protectionism.

We do it a bit in steel, largely in response to foreign subsidies. That's about it.

4.) I get your point on the boom, but we needed a world war and women flooding into the work-force to make that happen.

The share of women in the labor force increased from 29.7% in 1950 to 33.4% in 1960, or 3.7%. From 1970 to 1980 (after the boom) this increase was from 38.5% to 42.7%, or 4.2%. I don't buy that women's workforce participation caused the postwar boom. While an increase in womens' labor partially overlaps with the postwar boom, I don't think there's a causal relationship between the two or even a correlation.

https://www.dol.gov/wb/stats/facts_over_time.htm

5.) Your argument that many countries in the world are already protectionist is fair but, again, may not be relevant to how we should behave. The question is, will protectionism lead to optimal economic outcomes for our nation? How much has protectionism helped these protectionist economies vs. hurt them?

This is an extreme libertarian argument. My argument comes from the prisoner's dilemma.

For countries we trust (UK, Canada, Australia, NZ, maybe SK, maybe Germany, maybe Poland), we should have free trade. Win-win. For countries that are willing to screw our citizens to help theirs', we should pursue mercantilism. The proper response to tariffs is retaliation, but China etc started it, and we can hurt them more than they can hurt us.

I agree that both countries benefit more from free trade than mercantilism, but if one country plays mercantilist and one country plays free trade, the free trade country loses, and would have been better off being mercantilist in its trade relations with that country.

Would China be growing at 13% instead of 8% if it were more liberal with its policies on foreign investment and more liberal with its trade policy? That is a question that deserves answering before we go off the protectionist deep end.

It's irrelevant. There's two Nash Equilibriums on bilateral trade-- either both countries pursue free trade or both countries pursue mercantilism. I wish China et al. would pursue free trade, but they're not doing it. Therefore, the US must pursue mercantilism with them.

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Feb 1, 2017

1.) Agreed, but just because Russians are under an authoritarian regime that stifles free speech and has lax domestic violence doesn't mean Russians can't assimilate into our values. We seem to only behave as if people can't assimilate when they don't look like the majority in this nation.
2.) I'm a democratic-leaning libertarian but wouldn't consider myself a democrat. My point is, why are we punishing Indian engineers who want to come here and contribute to the United States' economy because India's government is protectionist? It makes no sense.
3.) Willing to concede on this, although last I checked, steel industry doesn't even break into the top 5 most subsidized industries in this nation. Can't find my sources so I'll leave this one alone.
4.) Fair point, WWII was the biggest factor in that boom which is (hopefully) not repeatable so that makes the era not a valid case-study. I could easily point to the protectionism during the 1930s making the world depression worse than it needed to be.
5.) My point regarding China is not irrelevant. Your assumption is that protectionism will work to the benefit of the United States, if it is working to the detriment of protectionist nations then why would we assume it will work to our benefit? If retaliatory tariffs against China will only hurt our growth (regardless of their protectionist stance) then why should we engage in such actions?

p.s. I am all for sticking it to China btw, but not in a retaliatory tariff sense, heavily limiting their investments in American companies (for example, banning govt. owned companies from investing) will do just fine

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Feb 1, 2017
BobTheBaker:

1.) Agreed, but just because Russians are under an authoritarian regime that stifles free speech and has lax domestic violence doesn't mean Russians can't assimilate into our values. We seem to only behave as if people can't assimilate when they don't look like the majority in this nation.

Actually, this is where I disagree. Assimilation can only happen at a certain pace.

2.) I'm a democratic-leaning libertarian but wouldn't consider myself a democrat. My point is, why are we punishing Indian engineers who want to come here and contribute to the United States' economy because India's government is protectionist? It makes no sense.

Because we want the best opportunities for US citizens. If the US has 160 million jobs and we get 8 million immigrants, we'll certainly have more than 160 million jobs by the time we're done, but we probably won't have 168 million. Furthermore the question is at what pace can we assimilate new immigrants?

I think Indian and Chinese immigrants can do very well here, but the pace of cultural change is moving too quickly. The goal is not to punish Indian engineers; it is to ensure (1) our kids get jobs and (2) to ensure the Indian engineer's kids (and ideally also the engineer) are Indian-American, not Indian.

My point regarding China is not irrelevant. Your assumption is that protectionism will work to the benefit of the United States, if it is working to the detriment of protectionist nations then why would we assume it will work to our benefit?

This is just where we have to disagree. I think export subsidies help Chinese and Japanese labor demand and therefore workers and hurt American manufacturing and therefore workers when goods are sold below the cost of raw materials. It's possible Chinese residents would prefer to sit at home all day and collect a check. But I think most people would feel better getting $5 that they earned than just getting a $5 handout.

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Nov 25, 2017

I can't put my finger on it. For the longest time, I passionately disagreed with almost everything you said. The last 2 years or so, I find myself not recognizing you--like, I've agreed with practically all Illiniprogrammer for 2 years or so now. Is that just happenstance (issues have changed), have I changed, or have you changed? There was a time that I wanted to cane you in the head until your heart stopped beating, but I don't feel that way anymore about you...

Feb 1, 2017

I don't know why people are freaking out about this bill. I don't want to walk through NYC and see piles of homeless people all over the place. We should put all of our effort on lowering the income gap and giving jobs to as any Americans as possible. I could care less if we have the "top" economy or if we are "the most powerful nation on earth", I just want a job that pays well enough where I can get drunk, go skiing, and play golf. We need to build a strong middle class that America was built on.

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Feb 1, 2017

Unfortunately, homeless people are not going to be doing the jobs of H1-B workers. Additionally, non-H1B legal immigrants to this country have a predilection toward starting small businesses and, you know, employing existing Americans.

Illegal immigration is a scourge on this nation, but legal immigrants, having jobs and being taxpayers, are clearly and objectively a net benefit to our society.

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Feb 1, 2017

The U.S. has not had this amount of isolationism since the 1930's.

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Feb 1, 2017

As a Republican (or maybe at this point, RINO? Libertarian?), I feel like I am taking crazy pills.

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Feb 1, 2017

The majority of these H1-Bs go to Indian outsourcers. Bumping it to $100k plus actually would likely shift the H1-B allocation to companies that are hiring top talent, rather than body shopping.

Feb 1, 2017

Vastly increasing the quota of H1-B could accomplish the same thing without the ridiculous consequence of pricing out labor of young talented immigrants.

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Feb 1, 2017

https://i.imgflip.com/8vl28.gif

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Feb 1, 2017

The first person on here to actually state the reason why this is being enacted...

Feb 1, 2017

Immigrants have something to prove, most locals don't in comparison.

Some Enlist in the Military to earn their right to a Citizenship by serving to defend the USA. These people are the hardest working I've ever seen in my life. Compared to the "locals", the ones who are coming out of third-world Countries can easily outwork the typical entitled American in and out of the uniform.

Granted, there are a ton of hard working Americans. I'm stereotyping the trend that we all see which is this growing sentiment of going backwards in terms of maturity and dedication going forward into the Corporate America workforce. Absolutely unacceptable when people of the same age are bleeding, dying, and sacrificing themselves to defend this Country while the entitled citizens feel like the USA, their parents, and the World at large owes them something.

Feb 1, 2017

False - assuming people are going to a company that values performance over the flat out number of years worked.

...

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Feb 1, 2017

The Fat 500 has a lot of lazy bums of all types. Compare this with the Samurai mentality of Japan and you will notice a cultural difference between the America today vs what made this Country great back in the Industrial Age and the insane national mentality of besting everyone else as exhibited by the Japanese. Ever seen little kids walking around at middle of the night from the train station after getting done at Cram schools?

Most Generational Wealth fizzles out after 3-4 Generations. Where are the Vanderbilts today?

This land belonged to the Native Americans. So, essentially, it's one group of Immigrants who got here early to the Gold mine feeling entitled and scared of their loot being diluted or distributed preventing others from doing the same, right?

Singapore has better living standards and quality of life as does Japan. If you don't need to feed on your local land and can monetize with an internet based business, I see no reason why this is the best Country to remain as a resident. For anyone who has been overseas, there are definitely greener pastures elsewhere.

@differentialequations12 @Xiiixiii

Feb 1, 2017
BreakingRich:

False - assuming people are going to a company that values performance over the flat out number of years worked.

Ever seen people die of overwork here in the USA? Working 120-140 hour weeks were normal in the Military. In Japan, if you are not dying, you are not trying! They used my people, the Chinese, as mortar to build the Great Wall.

Old Wise Chinese Saying:
"Yep, this poor bastard overworked himself and died. Good! Now his body shall hold up the Wall as we use his remains for filling in voids and can report more efficient cost-savings with reduced material consumption while also saving on funeral and severance costs."

People who slept 4 hours a night were having beauty sleep, normally your lucky if you slept 3, and you wake up and walk 2mins to the Office and 5mins to chow hall (cafeteria). A true work from 'home' experience! models and bottles? What's that? For some it was mortars and RPGs, for others it was Drills and Damage Control all hours of the day. You don't have that luxury in the middle of the Ocean, underneath it, or in a flaming hot Desert.

Work-Deployment Balance. Work is life. This is why Veterans transition well into WallSt like the various VIP programs. This is easy. Most of you haven't been to 3rd world countries, bled in them, or volunteered in disease ridden hospitals with blood and other human fluids all over the ground and walls. Most of you haven't had experiences or never will have experienced being deployed. Per hour pay for Enlisted is well below minimum wage and now the wage is going to double, the per hour pay of Enlisted will be even worse. It might be more profitable to flip Burgers at McDonalds than to defend your Country against all Enemies, Foreign and Domestic. That's a scary thought because who's going to join now when the incentives are drastically worse financially?

Then again, when we weren't deployed... :)

Feb 1, 2017

As someone who has lived, worked, and studied abroad in multiple countries - with family across 6 of 7 continents (additionally, my parents are immigrants) I still disagree with what you are saying. Your broad sweeping statement does not apply to every single immigrant out there, nor does mine apply to all domestic residents.

I think you missed my point entirely, (And correct me if I missed yours), but just because you are an immigrant does not mean you are the hardest worker in the room. Especially in the case of H1B sponsored individuals. How many small business are sponsoring these candidates? Not too many right? More so, most immigrants do not go on to become founders of Google or make partner at Goldman.

I don't know how you can say most residents do not have something to prove compared to immigrants. Look at the investment banking scene, try and tell me that every immigrant applicant is a harder worker and better than your average applicant.

You also spoke about the military. Just so happens that I work in the defense industry where my company has a very large % of our workforce who are veterans. I can't think of any of the veterans that I met who enlisted because they thought they were going to receive a killer base salary and absurd bonus. People may join because of the health benefits and educational assistance GI Bills can offer, but I would say the majority enlist because they feel they have a duty to serve their country.

Locals vs immigrants comes down to far more than place of origin, it matters substantially more what your social & economic background was.

My personal belief of the workforce in Asian countries is that most workers are not hard-workers by choice but because they are programmed to meet that standard (as you pretty much alluded to). There is greater consequence for not putting those hours into your studies there than in the USA. Your social standing is critical to how you are perceived from a financial future and workplace stature. (Don't believe me? See what happens if a 1st year Analyst were to look directly into the eyes of a Japanese CEO. Often considered an extremely disrespectful action).

Sorry, post is all over the place but I am working as I write. :)

...

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Feb 1, 2017

Hard workers:

Hardworkers are a rare breed these days at large. Those who can make it out of their countries are typically cream of the crop for the most part especially if they can make it into top prestigious Universities in the USA.

Having been vetted by School, which is why there are target schools, as they make recruiting easy, since the education process is streamlined, the coursework predictable, and GPA meaningful, those who can immigrate to USA and graduate from top Institutions are typically prized above just the typical immigrant and certainly the typical resident of their Native country.

This is why America is the greatest Country for brain draining talent from other Countries AND organically breeding top talent who are, at their core, hardcore grinders with talent born and raised in the good ole USA.

Hindering Brain Drain has long-term consequences that are not yet realized yielding a very immediate short-term gain. You would have to assume that there is enough top talent here equally if not better than those artificially blocked out to justify this strategic maneuver. If not, the long-term consequences can be quite dire.

Immigrants:

Locals are just children of previous immigrants... This entire nation was built by Patriots migrants who escaped from the rule of British Empire.

Military:

People Enlist to:

  • Escape from broken homes and neighborhoods
  • GI Bill (as you've mentioned)
  • Serve the Country (obvious)
  • Earn their US Citizenship (Officers must be Citizens)
  • Join the Brotherhood and Network of Veterans
  • Travel the World
  • Having cool stories to tell for rest of their lives
Feb 1, 2017

Correct me if I'm wrong, but I'm looking at the bill, and the $130000 min wage applies only to H1B-dependent employers (ie outsourcing companies, not BBs or EBs).

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Feb 1, 2017

I think you are right. Most of the popular companies on here are not H1B dependent companies therefore won't be affected by whatever it is, be it 60K or 130K or 500K.

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Feb 1, 2017

60 to 130 is a 117% increase, which is an outrageously drastic shift in terms of the relative magnitude of the change. This will cause not only the number of foreigners working in the US to plummet going forward, but also the number of foreigners wanting to study in the US - since the chances of them working here after graduation will be slim

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Feb 1, 2017
Going Concern:

60 to 130 is a 117% increase, which is an outrageously drastic shift in terms of the relative magnitude of the change. This will cause not only the number of foreigners working in the US to plummet going forward, but also the number of foreigners wanting to study in the US - since the chances of them working here after graduation will be slim

Sweet. More seats for Americans at universities, too.

In all seriousness, $60K is low, but $130K is extreme. I favor a minimum that's $10k above whatever Street is for a first year analyst these days. Is it still $80K? But raising the H1B minimum wage is going to push up middle-class wages, especially for young employees with STEM backgrounds.

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Feb 1, 2017
IlliniProgrammer:

In all seriousness, $60K is low, but $130K is extreme. I favor a minimum that's $10k above whatever Street is for a first year analyst these days.

10k above market average (by region) for an analyst would make perfect sense. 130k minimum wage is ridiculous

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Feb 1, 2017

10k above market average would make perfect sense. 130k minimum wage is ridiculous

There's some asterisks in all of that. If your firm is less than 15% H1B, the $130K minimum is irrelevant.

Lofgren is going after Infosys, not Google (who's minimum wage is pretty darned close to $130K), and I don't think she thinks she's going after the banks. I know they definitely hire a number of H1Bs, especially in technology, QR, and analytics, which I suspect is enough to push them over, but I'm not sure the rest of the firm is over 15%.

I'll give you that $130K is unusually high; not sure it is ridiculous. I would much rather, instead of a Visa lottery, have firms have a Visa auction based on employee salary. Maximizes income tax revenues and GDP, but no H1B Visa holder will ever be paid a round number salary again (Ebay sniping game theory).

This is good news for any 21 year old studying CS or EE if this bill passes. If you have a pulse and know how to write "hello world", you can now earn $90K/year as an IT guy. Oh, and S&T should expect 10x more bugs and glitches in just about every system they use.

Idunno. I'd go with $110K; $80K in rural areas that specifically volunteer for it, as long as there is a 1:1 H1B:Citizen employee ratio.

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Feb 1, 2017
IlliniProgrammer:

10k above market average would make perfect sense. 130k minimum wage is ridiculous

There's some asterisks in all of that. If your firm is less than 15% H1B, the $130K minimum is irrelevant.

Lofgren is going after Infosys, not Google (who's minimum wage is pretty darned close to $130K), and I don't think she thinks she's going after the banks. I know they definitely hire a number of H1Bs, especially in technology, QR, and analytics, which I suspect is enough to push them over, but I'm not sure the rest of the firm is over 15%.

I'll give you that $130K is unusually high, not ridiculous.

You just love to argue don't you. I didn't know about the 15% rule, so that adds some clarity. Though I'd guess that a lot of tech firms are over that threshhold. Also the 15% number seems pretty arbitrary, no real rhyme or reason. My guess is firms will just lower their Visa employee base until it's just below the threshhold

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Feb 1, 2017

Apparently the $60k rule was set in 1989. Inflation adjusted amount in 2017 would be $120k, pretty close to what they are suggesting.

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Feb 1, 2017
altoidsc:

Apparently the $60k rule was set in 1989. Inflation adjusted amount in 2017 would be $120k, pretty close to what they are suggesting.

Damn you're right. Reality is mind blowing sometimes

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Feb 1, 2017
Going Concern:

IlliniProgrammer:10k above market average would make perfect sense. 130k minimum wage is ridiculousThere's some asterisks in all of that. If your firm is less than 15% H1B, the $130K minimum is irrelevant.Lofgren is going after Infosys, not Google (who's minimum wage is pretty darned close to $130K), and I don't think she thinks she's going after the banks. I know they definitely hire a number of H1Bs, especially in technology, QR, and analytics, which I suspect is enough to push them over, but I'm not sure the rest of the firm is over 15%.I'll give you that $130K is unusually high, not ridiculous.

You just love to argue don't you. I didn't know about the 15% rule, so that adds some clarity. Though I'd guess that a lot of tech firms are over that threshhold. Also the 15% number seems pretty arbitrary, no real rhyme or reason. My guess is firms will just lower their Visa employee base until it's just below the threshhold

Sorry no argument intended; I think we're in 99% agreement. And I think we're both adjusting our views to altoidsc's point.

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Feb 2, 2017

I've seen a lot of news articles with the headline "Come to Canada" "Canadian Tech companies optimistic in face to Trump's immigration restriction"

  • More than 200 Canadian technology company founders, executives and investors called on Sunday for Ottawa to immediately give temporary residency to those displaced by a US order banning the entry of people from seven Muslim-majority countries.
Feb 2, 2017

Here's a contrarian trade for you. Sh*t like this will raise wage artificially, with no additional productivity. Higher wages will decrease earnings. So short labor intensive companies.

You killed the Greece spread goes up, spread goes down, from Wall Street they all play like a freak, Goldman Sachs 'o beat.

Feb 2, 2017

A higher salary threshold will be hurt Infosys and similar cos, but I don't think big players like Google, Apple etc will feel a lot of pain on this. In theory this might even be good for them, since pushing outsourcing companies out of the game more visas would be available - But maybe offset by that 20% allocation to SMEs (which combined to a high salary requirement essentially means these probably won't be used).

Also, if I'm not wrong there is also a requirement that priority should be given to hiring Us citizens - while it does make sense, I believe this is already the case (correct me if I"m wrong) so I don't know how this would impact internationals more than they are today.

As mentioned in the first topic, this will probably lead to a shift in recruitment for internationals in low to medium pay roles, but I don't think this will necessarily mean a lot of high paying jobs for US citizens.

Feb 2, 2017

I'd also add that this legislation applies only to companies where >15% of their workforce are on H-1Bs. This excludes companies such as Accenture and IBM, allowing them to meet the $60K old cap.

Source: http://www.bbc.com/news/world-asia-india-38828181

Feb 3, 2017

First, it all was leaked and has never been confirmed.
Second, this potential 'raise' only applies to so-called 'dependent employers' (http://www.visapro.com/h1b-visa/h1b-dependent-empl...). I doubt that every big firm (not to mention smaller boutiques) meets the requirements.

If you follow rumors, try to read every paragraph.

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Feb 4, 2017
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Nov 24, 2017

"If you're afraid - don't do it, if you're doing it - don't be afraid!"
-- Genghis Khan

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