Immigration
Paper Session
Friday, Jan. 3, 2025 8:00 AM - 10:00 AM (PST)
- Chair: Joelle Saad-Lessler, Stevens Institute of Technology
Political Directors and the Recruitment of Foreign Workers
Abstract
Companies strive to gain a competitive advantage by recruiting highly qualified employees. One way to achieve this goal is by recruiting foreign workers, frequently through the H-1B visa program. However, immigration has become a contentious political issue in the United States, making it more difficult to recruit foreign workers. We examine how politicians on the board influence recruitment strategies aimed at attracting foreign workers. Using former President Donald Trump’s election and “Buy American, Hire American” policy, we estimate the impact of political directors on recruiting strategies. By analyzing the near-universe of job advertisements in the U.S., we develop novel firm-level measures of employment barriers for foreign workers. We find that the presence of political directors increases the employment barriers for foreign workers after Trump’s inauguration. We also argue that the information processing capabilities of the board moderate this effect: diverse boards and boards with HR committees decrease the employment barriers for foreign workers, whereas shareholder meetings during periods of heightened political risk increase these employment barriers.H-1B Program, Entry Visa Type and Skilled Immigrant Earnings
Abstract
At the time of its creation in the year 1990, 65,000 annual H-1B visas became available for the new applicants and the H-1B cap was increased to 115,000 in the year 1999 and further increased to 195,000 for the years 2001-2003 when the H-1B cap was not binding. H-1B cap dropped to 65,000 from 2004 onwards and has been binding because there is excess demand for skilled workers on H-1B visas by the U.S. firms. This paper uses various years of data from National Survey of College Survey (2003, 2010, 2013, 2015 and 2017) and a quasi-experimental setting to examine the earnings of immigrants who came on work visa during various H-1B cap periods and whether the cap was binding or not. Earning of immigrants is estimated relative to natives and earlier cohorts who came on work visa before 1990. We compare work visa immigrants in non-academia versus academia as well as cap bound and cap exempt countries. In the non-academic sector we find that immigrants who entered during 1990 - 1996 the first non-binding period when the cap was still 65,000 and then raised to 115,000 immigrants earned on an average 17.8 % more than natives but during the second non-binding period of 2001 to 2003 when the cap was drastically increased to 195,000 immigrants had no significant premium in earning compared to the natives. This is not seen for the academic sector. With an increase in H-1B cap and the cap not binding there is a possibility that many immigrants who came on work visa are less positively selected and H-1B workers are tied to their employers, the immigrant groups who come on H-1B often face wage penalty compared to natives and often employers pay them substantially less.Discussant(s)
Phanindra V. Wunnava
,
IZA and Middlebury College
Ethan Lewis
,
Dartmouth College
Jorge Medina
,
Stevens Institute of Technology
JEL Classifications
- J6 - Mobility, Unemployment, Vacancies, and Immigrant Workers