As a Berkeley professor, I see the impact H-1B visas and AI have on students’ job opportunities

He H-1B visa program It was intended to attract specialized talent from abroad, but instead it has become a tool for employers to hire lower-cost labor for ordinary jobs.

The result is a distorted labor market, where highly skilled workers are being excluded from the H-1B visa program by spamming applications for rank-and-file workers who then fill entry-level positions that are already in short supply. This misuse of H-1B visas has a negative synergy with growth Impact of AI on the labor market. and it is part of a larger problem that needs urgent attention.

The impact of this visa problem is particularly acute among young people and recent college graduates, who face a bleak job market despite moderate overall unemployment rates. According to government data, the unemployment ratio between college graduates under 25 and those over 25 has reached an all-time high of more than four to one. This means that entry-level jobs are already four times rarer than jobs that require advanced experience or knowledge.

Program applicants must explicitly be people with specialized skills, and those specialized skills must not be readily available in existing resident workers.

I have seen firsthand the symptoms of declining demand for entry-level technology jobs. These symptoms include fewer job ads from recruiters targeting recent IT graduates, job fairs with fewer companies, and worried advisors receiving fewer offers at lower salaries or, in some cases, no offers at all. Granting H-1B visas to low-paid, unskilled workers only exacerbates this shortage and does little to meet the real demand for workers with specialized skills.

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The problem here is not the number of visas issued, but how they are used. Program applicants must explicitly be people with specialized skills, and those specialized skills must not be readily available in existing resident workers. However, the bureaucratic review process allows employers to exaggerate claims and hire workers with ordinary skills at low wages. There is an entire subprofession of human resources personnel and lawyers who specialize in disguising pigeons to look like peacocks.

This abuse of the application process has created a lottery system where workers with the necessary special skills often lose out to those without any specialized skills. As a result, recent graduates find it harder to get an entry-level job, while at the same time, companies that really need specific specialized skills are unable to obtain visas for those workers. Imagine a person who suffers from malnutrition and diabetes because, instead of vitamins, they have been taking sugar pills.

I want to emphasize that I am not advocating insular restrictions on number of H-1B visas. The point is to ensure that people with real specialized skills that are really needed are welcomed through the H-1B program. When used correctly, an H-1B visa attracts someone who complements the workforce with necessary and specialized skills, potentially benefiting the entire country. Whether retaining a graduating international student or bringing in someone from outside the country, the United States has historically benefited immensely from immigrants with the necessary skills.

Many visa investors unconvincingly insist that H-1B visas are already intended for skilled workers as intended, but the statistics on H-1B visa recipients do not add up.

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According to the U.S. government’s Bureau of Citizenship and Immigration Services’ annual report, nearly 63,000 of the 2023 H-1B visa recipients were in “computer-related occupations” and the median salary for this group It was $99,000 a year, and 25% of them earning less than $85,000. A salary of $99,000 or $85,000 per year is certainly a good amount to earn, but it’s pretty low for what you’d expect someone with rare specialized skills in this field to earn.

You might think that people with specialized, hard-to-find skills would earn exceptionally good salaries, but this data shows otherwise. In fact, the more I dig into the data in the agency’s annual report, the less it appears that approved applications are for exceptional people for specialized jobs. It looks more like some specially skilled workers mixed in with many regular workers who are paid below what you would expect.

These observations are consistent with my own experiences hiring tech workers and mentoring computer science students, what others have told me firsthand, and numerous recently published analyses. The only clear explanation I see for these inconsistencies is that employers are presenting entry-level positions, not those requiring rare special skills, that even for entry-level salaries are low, and that those non-compliant applications are not being rejected.

Looking at the bigger picture, the misuse of H-1B visas is not the only obstacle facing job seekers in the United States because AI automation is also eliminating jobs, exacerbating the shortage. Currently, the impact of AI is disproportionately on entry-level jobs, exacerbating the problems caused by abuse of the H-1B program. However, AI will continue to improve, both in capability and ease of use, and its impact on the labor market will grow as the range of tasks it can perform expands.

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While AI and H-1B visa abuse may seem like distinct problems, they interact in a way that most people do not appreciate. Even when it cannot fully replace a human worker, AI makes working on the move easier away from regular employees to contractors or remote workers.

The explanation is that AI often eliminates the need for an advanced specialized skill or knowledge and replaces it with a lesser requirement of needing only the ability to review work for correctness. The result is that tasks that were previously too complex to hand off to contractors or remote workers are now made simpler by AI and more suitable for outsourcing.

As AI technology continues to improve, employers will find that more and more jobs can be performed by lower-skilled workers, and there will be greater motivation to use H-1B visas to hire those lower-skilled workers cheaply.

The H-1B visa program review process needs to be reformed to prioritize applicants with truly specialized talent and ensure that recipients do not compete unfairly with workers already in the U.S. We must also address the growing threat of AI automation and its growing impact on the labor market.

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Approximately 90% of all US tax revenue It comes from taxing workers’ income, so if unemployment continues to rise, tax revenue will be drastically reduced. At the same time, the number of unemployed people who will need public assistance will skyrocket. That combination doesn’t work mathematically and is a clear recipe for disaster.

This situation requires radical change to avoid a dystopian future. Overall unemployment numbers may look strong, but high levels of initial unemployment and overall underemployment indicate that a much larger problem is developing.

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Disclaimer: Any opinions expressed in this article are solely those of the author as a private individual. Nothing in this article should be construed as a statement made regarding the author’s professional standing at any institution.