Report: No Cowboys Riding the Range on Montana Dude Ranches; H-1Bs in the Saddle

Published on May 9th, 2017

The Economic Policy Institute, a Washington, D.C. think tank that generally favors higher immigration levels, is nevertheless an ally on the adverse effect temporary employment-based non-immigrant visas have on American workers

Recently EPI published its fact sheet that focused on the H-1B visa, outlined its flaws, and made realistic but elusive suggestions about how to improve the 30-year-old program. In the first paragraph, EPI identifies the problem, old news to many long-time American worker defenders, but concise.

H-1B visa employees include pre-school teachers,
downhill skiing instructors, sports coaches and cowboys.

EPI wrote that the H-1B program’s biggest beneficiaries are outsourcing companies that use between one-third to one-half of the visas to replace thousands of U.S. workers with much lower-paid H-1B workers, and also to send tech jobs abroad, another form of displacement. The vast majority of employers that hire H-1B foreign-born nationals legally pay them wages below the local average for the occupation. H-1B workers can be 40 percent cheaper to hire than Americans.

An example: The average software developer in the Silicon Valley makes $147,000 per year, but an H-1B software developer earning the Level 1 wage is paid $102,000. That’s a savings of $45,000 per H-1B worker per year for up to six years, more than enough money to explain the constant Silicon Valley lobbying to increase the 85,000 annual cap.

The fact sheet also points out the indentured servitude component of the H-1B visa, which the media largely ignores. The employer owns and controls the visa. Should the H-1B worker be fired, he becomes instantly deportable. This has led to workplace abuse in the form of long hours without additional compensation.

Lax H-1B visa oversight also has contributed to its scandalous misuse. The Center for Investigative Reporting as part of its “Techsploitation” series chronicled numerous incidents that include one example of an H-1B employer, Tesla, which paid Eastern European workers $5.00 an hour, and a Montana dude ranch that filled its summer openings not with local cowboys, but with H-1B visa holders.

Facts belie claims that Americans don’t want to do ranch work. Colleen Hodson, executive director of the Dude Ranchers’ Association, said that the average ranch gets 50 to 100 applications for any open position.

EPI offers a standard fare menu of reforms that include simple-sounding solutions like hiring Americans first and guaranteeing an H-1B pay rate equal to or above the prevailing local wage. Such proposals have been offered up before but have never advanced an inch. President Donald Trump has taken baby steps to correct H-1B inequities, but they’re unlikely to go anywhere either.

The best fix is to use the EPI fact sheet as a rational for ending, or at least imposing a moratorium on, the dozens of employment-based visas. The United States doesn’t need more workers, some of whom never return home, shutting Americans out of future jobs, and eventually adding to the chain that adds more people to an already overcrowded nation.

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