The U.S. Department of Homeland Security (DHS) needs better information on foreigners working in the United States under H-1B visas, a congressional research agency says.

Reporting October 2 on H-1B workers and changes in their visa status, the General Accounting Office [GAO] said DHS's incomplete information about H-1B worker entries, departures and changes in visa status does not allow it to provide key information needed to oversee the H-1B program and its effect on the U.S. workforce.

The H-1B visa program allows employers to fill specialty occupations with highly skilled foreign workers. It has been a contentious issue between U.S. workers and employers during the recent economic downturn.

In the report, GAO recommends that DHS take actions to ensure that change of visa status data are entered into DHS's computer system and integrated with departure data. The agency also recommends that DHS issue regulations addressing the extent to which unemployed H-1B workers are allowed to stay in the United States.

The H-1B nonimmigrant visa category was created in 1990 to assist employers seeking workers in specialty occupations. In order to hire H-1B employees, an employer must attest they would not adversely affect the working conditions of other people similarly employed in the area.

The full report is available at: www.gao.gov/cgi-bin/getrpt?GAO-03-883.

Results in Brief

H-1B beneficiaries were approved to fill a wide variety of positions, and the number of H-1B petition approvals in certain occupations has generally declined along with the economic downturn, as have employment levels of U.S. citizen workers in these occupations. In contrast with 2000, most H-1B beneficiaries in 2002 were approved to fill positions in fields not directly related to IT, such as economics, accounting, and biology. In 2002, 40 percent of all H-1B beneficiaries were approved to fill IT-related occupations, such as systems analysis and electrical engineering, compared with 65 percent in 2000. We found that in most of the five occupations we examined (electrical/electronic engineers, systems analysts/programmers, biological/life scientists, economists, and accountants/auditors), H-1B beneficiaries with petitions approved in 2002 were younger and a higher percentage had an advanced degree than the population of U.S. citizen workers in 2002. In the three occupational groups (electrical/electronic engineers, systems analysts/programmers, and accountants/auditors) for which there were sufficient data to compare earnings, salaries listed on petitions for younger H-1B beneficiaries (18-30 years old) approved in 2001 who did not have advanced degrees were higher than salaries reported by U.S. citizen workers of the same age group and education level. However, salaries listed on petitions for older H-1B beneficiaries (31-50 years old) were either similar or lower than the salaries reported by their U.S. counterparts. Both the number of H-1B petition approvals and U.S. citizens employed in four of the five occupations we examined decreased from 2001 to 2002. However, it is unclear whether this decrease in U.S. workers employed was paralleled by a decrease in H-1B beneficiaries employed in these occupations, because BCIS [Bureau of Citizenship and Immigration Services] is unable to determine the actual number of H-1B beneficiaries who are employed in the United States.

The majority of the 36 employers that agreed to be interviewed said they recruited, hired, and retained workers based on the skills needed, rather than the applicant's citizenship or visa status. Among employers who said visa status was a factor in their decisions, several noted that they hired H-1B workers only when qualified U.S. workers were not available. Half of the 36 employers we interviewed reported that they did not go abroad to recruit workers for U.S. positions, but instead found U.S. citizen and H-1B workers through employee referrals, the Internet, and U.S. graduate schools. About two-thirds of employers said that most H-1B workers hired were already in the United States on foreign student visas or working for another employer on an H-1B visa when they were recruited. In discussing their recruiting efforts, many employers said that intense competition for IT-related workers in 1999 made it difficult to find qualified workers in the United States, but that the supply of workers has since increased while the demand for workers has decreased. However, most employers said that finding qualified workers in some engineering and other science-related professions remains difficult. Employers that laid off workers after the economic downturn told us that they made these decisions based on changes in business needs, regardless of employee citizenship or visa status. The majority of employers interviewed cited cost and lengthy petition processing times as major disadvantages to hiring H-1B workers; however, they said they would continue to use the H-1B program to find candidates with the skills needed. Some employers said that they hired H-1B workers in part because these workers would often accept lower salaries than similarly qualified U.S. workers; however, these employers said they never paid H-1B workers less than the required wage. Labor is responsible for, among other things, ensuring that employers do not violate H-1B wage agreements, and continues to find instances of employers not paying H-1B workers the wages required by law; however, the extent to which such violations occur is unknown and may be due in part to Labor s limited investigative authority.

Little information is available regarding H-1B workers entries, departures, and changes in visa status due to the limitations of current DHS tracking systems, but new systems are being developed to provide better information. One reason DHS is unable to determine the number of workers who are in the United States at a given time is because it maintains two separate tracking systems that do not share data. The Non-Immigrant Information System (NIIS) has data on entries and departures and the Computer Linked Application Information Management System 3 (CLAIMS 3) has data on changes in visa status. Data from both of these systems are needed to calculate the number of H-1B workers in the United States. In addition, while DHS collects information on change of visa status and jobs held, this information is not consistently entered into CLAIMS 3. Because these data are not consistently entered, it is not possible to determine the extent to which H-1B workers become permanent residents or remain in the United States on other employment-related visas to work in the same occupations. DHS has recognized the need for more comprehensive and reliable immigration data and is working to develop improved tracking systems. One system, the U.S. Visitor and Immigrant Status Indicator Technology System (US-VISIT), is intended to incorporate data managed by DHS as well as other agencies, such as the Department of State, in order to provide a foreign national's complete immigration history. DHS plans call for these histories to include details about entries, change of status, and departures that can be aggregated for reporting purposes. US-VISIT will be managed by DHS and is mandated to be fully implemented by December 2005. In addition to information systems issues, we also determined that DHS s ability to provide information on H-1B workers is limited because it has not issued consistent guidance or any regulations on the legal status of unemployed H-1B workers who remain in the United States while seeking new jobs. While BCIS has the authority to issue regulations and has been working to establish them, more than 2 years have passed since the agency began this work. With inconsistent guidance and without regulations, unemployed H-1B workers and their potential employers may be unsure about whether these workers can be hired for new positions without first having to leave the country. In addition, allowing unemployed H-1B workers to remain in the United States to seek new positions may have implications for public services, such as Unemployment Insurance, and the labor force competition faced by U.S. workers.

To provide better information on H-1B workers and their status changes, we recommend that DHS consistently enter change of status data in its computer systems and integrate these data with that for entry and departure. Furthermore, we recommend that BCIS issue regulations that address the extent to which unemployed H-1B workers are allowed to remain in the country while seeking other employment. In its written comments on a draft of this report, DHS agreed with our recommendations.