The 1940s were the highest at 38% because of WWII. We needed to build a great many ships, airplanes, tanks, rifles, and other weapons to defeat Imperial Japan and Nazi Germany.
The 1950s figure of 24% reflects the reduction in production immediately after WWII.
The 1960s came in at 31% for many reasons, but the Vietnam War certainly played a part.
The 1970s were the third-highest at 27%, reflecting the fact that the U.S. was still a manufacturing powerhouse.
Then came the 1980s and 1990s, which dropped still lower, to 20%. China was given diplomatic recognition by Nixon who naively believed it would follow in the footsteps of the U.S. (the book, The Hundred-Year Marathon: China's Secret Strategy to Replace America as the Global Superpower by Michael Pillsbury, deals with this subject in depth). In fact, Chinese imports equaled our exports to it in 1985, coincidentally the first year for which data is available from the Census Bureau. The Reagan, Bush I, and Clinton administrations pushed for greater and greater imports from China, even giving it WTO membership and Permanent Normal Trade Relations. As the above graph shows (data is from the Census Bureau), Chinese imports have taken off like a rocket. And right in the middle of the period is when the H-1B visa program was created by Congress, in 1990.
But then came the aughts. Those who chant the mantra that tax cuts create jobs need to explain how the decade of Bush II's tax cuts resulted in zero job growth.
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The H-1B visa was created in the Immigration Act of 1990 and signed into law by Bush I in 1990. Senator Charles Grassley defines an H-1B visa as "a temporary, employment-based visa status for skilled foreign guest workers." He notes: "Contrary to popular misconception, employers are generally not required to demonstrate that no U.S. workers were available to do the job being offered to the H-1B worker. Nor do employers have to offer the job to an American even if they are equally or better qualified." Continuing on his position that H-1B visas are often abused: "Rampant fraud weakens the integrity of this visa program. A 2008 federal audit of the H-1B program found brazen violations and examples of non-compliance, such as forged documents, workers not being paid promised wages and even ghost business locations and no evidence of business activity as outlined in the H-1B petitions."
On a more ominous note, the Homeland Security Department does not know how many H-1B candidates are in the country due to "limitations in agency data."
* * * * *
One story that is neglected in these days of mass layoffs, entire industries being outsourced to China and other countries, and CEOs paid over one hundred million dollars per year regardless of the fact that the highest paid CEOs are often the worst performers is the one regarding Henry Ford. He famously doubled the salary of his employees in 1914 to $5.00 per day. Sure, a major consideration was to allow his employees to purchase Ford cars and trucks, but he was a smart businessman. As the Saturday Evening Post noted: "In 1914, the company sold 308,000 of its Model Ts -- more than all other carmakers combined. By 1915, sales had climbed to 501,000. By 1920, Ford was selling a million cars a year ... In 1919, Ford raised his minimum wage again, this time to $6.00 a day. Again, the wage hike produced higher production numbers."
* * * * *
Many American companies try very hard not to reveal the percentage of employees based in the USA. Pfizer, IBM, HP, Apple, and AT&T refuse to reveal that information. Two years ago, Procter & Gamble only had 35,000 out of 127,000 total, or 28%. HP and GE have outsourced well over a hundred thousand jobs between them, with former-CEO Jack Welch referred to as "Neutron Jack" because he acted like a neutron bomb, eliminating people but leaving buildings intact. Macworld reported two years ago that 60% of Apple employees worked in Apple Stores, with its retail wages similar to other low-paid retail jobs, so even the god-like Steve Jobs was a slum lord.
It goes without saying that the reason these multinational American companies are reticent to reveal their percentage of American workers is that they have outsourced most of their jobs to China, India, Vietnam, and other countries.
More than 90% of jobs created in the U.S. are in retail, restaurants, and other parts of the low-paid service sector. And the U.S. employment-population ratio just keeps on sinking, with the people who have been tossed out of the traditional job market having nowhere to go. The U.S. is in its present economic funk because it has outsourced millions of jobs, with those former American workers struggling to survive and not able to buy many consumer goods.
Here's how things used to work before outsourcing. The country would suffer a downturn, people would reduce buying, people would lose jobs in factories. But eventually the warehouses would run out of goods, factories would start hiring again, those newly hired workers would spend money, and the recession would end.
But now, instead of Americans being hired in factories, people in foreign countries are hired in factories built by companies which have outsourced their workforce to that country. This is why we will never see a drastic improvement in our economy regardless of what the Federal Reserve does.
* * * * *
One city in the Denver area used to have an area filled with very large containers for recyclables, about as large as typical tractor-trailers. For many years this arrangement worked very well, with individuals and families arriving with newspaper, bottles, cans, and cardboard separated for easy disposal.
One day I noticed that the containers were filled to the brim with trash, including hazardous material. My inner tree-hugger was offended by this selfish action.
On another day I arrived there in the evening. While I was there, a truck arrived and a few men emerged, swarming like ants to remove trash from their vehicle and deposit it into the bins. I pondered calling the police, as depositing trash, especially from non-residents, was illegal, but they were gone before one could have read even a few pages from Mao's Little Red Book.
Not surprisingly, the recycling park closed not long after that.
* * * * *
I first ran into H-1B visas many years ago while working for a major telecommunications company. Our Indian director decided to eliminate all legacy COBOL systems and replace them with custom-built C++ systems. He announced a schedule to eliminate the old programs. Some, but certainly not all, of the legacy developers would be retained and retrained, with the rest being laid-off. After a few years of only partial success, he reversed direction and announced that they were returning to the old legacy systems. This struck me as monumentally stupid, as many of the experienced people were long gone.
One day my manager told me of some gossip. One of our director's direct reports was his wife. He did not see any problem with that, even though company policy strictly forbade it.
A few of my Indian co-workers would tell me from time-to-time that they worked until midnight or even later on a software issue. The next morning they were back at work at the usual time. I could not understand this at the time, given that productivity drops when working long hours, but later I realized that as H-1B visa holders, they could not refuse to work these hours, as their visas only allowed them to work for that specific company. And the company used their work habits as a bludgeon for the rest of us at performance reviews.
* * * * *
The Senate's immigration Gang of Eight -- Senators Michael Bennet (D-CO), Richard Durbin (D-IL), Jeff Flake (R-AZ), Lindsey Graham (R-SC), John McCain (R-AZ), Bob Menendez (D-NJ), Marco Rubio (R-FL), and Chuck Schumer (D-NY) -- in June rammed through a bill, S.744: Border Security, Economic Opportunity, and Immigration Modernization Act, which in part translated to welfare for multinational corporations.
Most people concentrate on the section which gives amnesty to illegal immigrants, usually from Mexico and Central America. There is a certain amount of fairness to this, given that we often use these people like slaves in meatpacking plants and as domestic servants, often after their passports are confiscated to make them more pliable.
Walmart is a world-leader in this respect, with it having been fined a record $11 million for using hundreds of illegal immigrants to clean its stores during the night; falling prices in this context must refer to their wages. As is typical for corporate cases, no one was charged with a crime. Walmart insisted that none of its executives knew anything about it, which makes them either politician-quality liars or incompetent. $11 million is chump-change compared to sales for the previous year of $288.2 billion.
Walmart claimed that a sub-contractor hired the illegal immigrants and therefore the company executives were not to blame, but a Walmart manager was responsible for choosing that sub-contractor. And that manager was working under Walmart budgets set by his superiors.
Walmart is a world-leader in another respect. As many as 525,000 full-time hourly employees earn less than $25,000 a year, a poverty-level salary. Not surprisingly, a congressional report noted, just as one example, that the 300 employees at one Supercenter in Wisconsin required some $900,000 worth of public assistance a year, essentially transferring the burden from the private to the public sector. Add to that the fact that many Walmart stores are given tax breaks by the local city and that Walmart tends to drive small businesses into bankruptcy, and it becomes clear that it is a world-leading parasite.
The solution to illegal immigration is simple: severe fines and prison time for the employers of illegal immigrants. Walmart should have been fined a significant percentage of sales and the person(s) who made the policy decision should have gone to prison. When jobs disappear for illegal immigrants, they will return home of their own accord.
However, the liberal Huffington Post did not even mention the fact that S.744 will allow into the country even more foreigners, largely Indian, who are replacing American workers via H-1B visas, but then again, neither did ABC News, Politico, CNN, or U.S. News and World Report.
According to the Department of Labor, 65,000 people are allowed into the country under the H-1B visa program, with an additional 20,000 under the H-1B advanced degree exemption, meaning that the first 65,000 are only required to have a B.S. degree.
But there must be many loopholes in the law because 134,780 H-1B petitions were approved last year. 20% of those petitions went to four firms: Cognizant Technology Solutions, Tata Consultancy Services, Infosys Limited, and Wipro Limited. The last three are Indian-owned and the first might as well be, as its SEC filings included this tidbit: "The vast majority of our technical professionals in the United States and Europe are Indian nationals."
The largest users of H-1B visas are offshore outsourcing firms, but IBM, Microsoft, Qualcomm, Amazon, Intel, Google, Oracle, Cisco Systems, Facebook, and Apple all play their part as well.
Migration News noted: "Under S.744, more H-1B visas would be made available ... The number of regular H-1B visas would increase from the current 65,000 a year to 110,000, and the number of visas for foreigners who earn advanced degrees from US universities would increase from 20,000 to 25,000. A High Skilled Jobs Demand Index could allow the number of H-1B visas to rise by 10,000 a year to a maximum 180,000, and H-1B workers sponsored by their US employers for immigrant visas would not be counted against the quota."
That "High Skilled Jobs Demand Index" is a Trojan Horse, allowing the number of H-1B visas to just keep increasing and increasing. That 10,000 figure can easily be modified upwards later by a simple attachment to an otherwise innocuous bill, escaping the attention of people interested in fairness to the American worker.
Migration News continued with: "S.744 as originally introduced would have required all employers of H-1B workers to try to recruit US workers for at least 30 days before hiring H-1B workers. Employers would have had to post job openings on a web site and certify that they did not lay off US workers to open jobs for H-1Bs and pay "significantly higher wages" to H-1B workers than currently. During markup, however, the Senate Judiciary Committee accepted amendments that would exempt most employers from these try-to-find-US-workers requirements, and rejected amendments that would have required DOL to audit at least one percent of H-1B employers each year. Silicon Valley leaders ... opposed provisions that require employers to certify they did not lay off US workers to hire H-1B workers."
So companies won't even have to pretend to attempt to hire Americans before hiring Indians to replace them.
And this completely eliminates the stigma of companies refusing to hire the unemployed but pretending that they do, something which is very common in the U.S. today.
According to the Department of Labor, workers in the software industry make up 93% of H-1B visas -- Computer Systems Analysts, Computer Programmers, Computer Occupations - All Other, Software Developers - Applications, Computer and Information Systems Managers, Software Developers - Systems Software, Network and Computer Systems Administrators, Management Analysts, Accountants and Auditors, Electronics Engineers - Except Computer -- resulting in the situation today in the software business where Americans have great difficulty finding work in an industry we largely created.
According to the Department of Labor, the top three companies using H-1B visas are Wipro, Infosys, and Cognizant, with 76,365, 49,633, and 40,168 employees, respectively, resulting in 166,166 jobs lost by Americans.
Back in 2008, Businessweek found that 13% of petitions filed for H-1B visas are fraudulent, with another 7% containing some sort of technical violation. A USCIS report, H-1B Benefit Fraud & Compliance Assessment, found that visa workers with only bachelor's degrees were subject to higher fraud or technical violation rates (31%) than those with graduate degrees (13%). This makes perfect sense because workers with only bachelor's degrees are being brought in to replace American workers, while those with advanced degrees might be bringing in some new ideas.
CBS News confirmed that fraud is still a regular occurrence in the Indian H-1B visa industry, reporting that Infosys will pay $34 million to settle charges of visa fraud, the biggest fine of its kind in American history.
CBS News senior correspondent John Miller interviewed a whistle-blower and former Infosys principal consultant, Jay Palmer:
Miller: "So then what's the motive to bring [Indians under an H-1B visa] in? You could hire an American who is trained in that particular discipline and do better."
Palmer: "It's purely profit."
Miller: "Did you find that they were all people who had some special expertise that we couldn't find here?"
Palmer: "Absolutely not. Not even close."
Palmer echoed a claim made by many Americans who were replaced by Indian H-1B visa holders, that they were unqualified for their position and had to be trained by the same American workers whose jobs they were taking. The usual tactic to coerce American workers into doing this is to tie it to severance pay: no training, no severance.
Senator Marco Rubio, one of the Gang of Eight, disingenuously declared on the subject of his gang's immigration reform: "I, for one, have no fear that this country is going to be overrun by PhDs."
Someone needs to inform Rubio that his precious bill does not restrict H-1B visas to people with advanced degrees.
At least some members of the Tea Party agree with Rubio on the subject of increasing the number of H-1B visas, with one member writing in a letter to him: "The need for an increase in the number of high-skilled H1B visas is a simple fix that could be done tomorrow." Perhaps this member, like Rubio, does not understand that H-1B visas are mainly used for people with only a bachelor's degree.
Palmer and Bloomberg News also confirmed that Infosys had been bringing Indians in on B-1 visas which are intended only for meetings and conferences, after which the recipient is supposed to return home. The State Department's website for visitor visas quite clearly states that B-1 visas are only to be used for four purposes, all of them short in duration: consult with business associates, attend a scientific, educational, professional, or business convention / conference, settle an estate, or negotiate a contract.
One of the only good parts of S.744 is that companies with more than 15% of U.S. staff on work visas will not be able to place those employees at client sites, possibly placing a virtual stake in the hearts of outsourcing companies like Wipro, Infosys, and Cognizant. This proposed measure will "undermine the competitiveness of Indian information-technology business in the U.S." according to India’s Trade Minister Anand Sharma via Steve Van Andel, chairman of the U.S. Chamber of Commerce, with the latter organization being known for pushing the use of H-1B and other visas to improve the bottom line of corporate executives and shareholders at the expense of American workers.
Of course Indian information-technology business will suffer, but why is that more important than jobs for Americans?
When S.744 is modified in conference between the House and Senate, the H-1B program must be modified to eliminate the use of them for anyone with less than a master's degree. B-1 visas must include a fine as well as a criminal penalty for abuse, with both petitioner and sponsor liable for prison.
Anything less would be a slap in the face of American workers.
Originally posted in 2013 and edited in 2015, with graph data being updated through the end of 2014.