Canada Continues to Benefit From U.S. H-1B Confusion

Canada continues to benefit from the confusion over United States immigration policy, according to a new report from NPR.

That NPR report cited a new study by CBRE, a real-estate services firm that regularly analyzes the job market in North America. According to CBRE’s data crunching, Toronto gained 80,100 tech jobs between 2013 and 2018, for a net brain gain of 57,634—placing it ahead of Silicon Valley and Seattle.

Another major city in Canada, Vancouver, came in fifth place on the chart, with a net brain gain of 11,160. Although the CBRE report attributes the tech-worker expansion across North America to a number of factors, including a robust educational pipeline in some of the largest cities, NPR also points to recent U.S. immigration policies for the influx of tech talent to Canada.

“While the States has gone, ‘Let’s make it difficult to get the employees here on a visa,’ Canada’s gone the exact opposite, and it’s beneficial for Canada,” Alex Norman, the other co-founder of TechToronto, told the media outlet. “You had a fast-growing ecosystem here that’s been getting a shot of steroids.”

This isn’t a new situation, of course. In mid-2019, Vox and other publications cited the migration of tech talent to Toronto and other locations in Canada. “Talented international professionals choose destinations other than the United States to avoid the uncertain working environment that has resulted directly from the agency’s processing delays and inconsistent adjudications,” Marketa Lindt, president of the American Immigration Lawyers Association, told a U.S. House of Representatives hearing during July testimony (hat tip to Time for the quote).

A 2019 study from Envoy Global found that 65 percent of employers consider Canada’s immigration policy more favorable to their operations than U.S. policy, with 38 percent thinking of an expansion into Canada. Twenty-one percent said they already have an office in the country.

Over the past few years, the U.S. government has denied an increasing rate of H-1B applications. As part of this crackdown on H-1B visas, consulting and “business services” firms (which petition for thousands of H-1B workers, which they often subcontract to other firms) have ended up particularly targeted by this rise in denials:

However, that spike in denials might be ending. In the first quarter of fiscal year 2020 (which includes October-December 2019), the federal government approved a higher percentage of H-1B applications compared to the year-ago quarter (83.4 percent for Q1 fiscal 2020, versus 75.4 percent in Q1 fiscal 2019). Meanwhile, denials declined year-over-year, from 25,080 to 18,607. (If you want a full breakdown of the numbers, check out this handy PDF spreadsheet pumped out by USCIS.)

The big question is: Will that trend hold? And if it does, will tech companies regard that as “stability” and stop attempting to outsource tech work to Canada and other countries? Much will hinge on the policies that U.S. Citizenship and Immigration Services (USCIS) attempts to enact this year, and which legal battles it ends up winning; for example, the court fight over the government’s attempt to end the H-4 EAD, which allows spouses of H-1B visa holders to work in the U.S., is still very much underway.

26 Responses to “Canada Continues to Benefit From U.S. H-1B Confusion”

  1. While lobbying Congress for more H-1B visas, industry claims H-1B workers are the “best and brightest”. Come payday, however, they’re entry-level workers.

    The GAO put out a report on the H-1B visa that discusses at some length the fact that the vast majority of H-1B workers are hired into entry-level positions. In fact, most are at “Level I”, which is officially defined by the Dept. of Labor as those who have a “basic understanding of duties and perform routine tasks requiring limited judgment”. Moreover, the GAO found that a mere 6% of H-1B workers are at “Level IV”, which is officially defined by the Dept. of Labor as those who are “fully competent” [1]. This belies the industry lobbyists’ claims that H-1B workers are hired because they’re experts that can’t be found among the U.S. workforce.

    So this means one of two things: either employers are looking for entry-level workers (in which case, their rhetoric about needing “the best and brightest” is complete B.S.), or they’re looking for more experienced workers but only paying them at the Level I, entry-level pay scale. In my opinion, employers are using the H-1B visa to engage in legalized age discrimination, as the vast majority of H-1B workers are under the age of 35 [2], especially those at the Level I and Level II categories.

    Any way you slice it, it amounts to H-1B visa abuse, all facilitated by and with the blessings of the US government.

    The National Association of Colleges and Employers (NACE) has never shown a sharp upward trend of Computer Science graduate starting salaries, which would indicate a labor shortage (remember – the vast majority of H-1B visas are granted for computer-related positions). In fact, according to their survey for Fall 2015, starting salaries for CS grads went down by 4% from the prior year. This is particularly interesting in that salaries overall rose 5.2% [3][4].

    References:
    [1] GAO-11-26: H-1B VISA PROGRAM – Reforms Are Needed to Minimize the Risks and Costs of Current Program
    [2] Characteristics of H-1B Specialty Occupation Workers Fiscal Year 2016 Annual Report to Congress October 1, 2015 – September 30, 2016
    [3] NACE Fall 2015 Salary Survey
    [4] NACE Salary Survey – September 2014 Executive Summary

    • Canada’s IT is garbage quality and getting worse. Most of these people are being hired into government jobs so they don’t form economic ghettos and do stand around jobs racking up huge salaries and benefits and pensions … the average Canadian is being thrown into the gig economy. Canada is NOT benefiting from this … it’s just a migrating swarm of tech locusts that arrive when there is a harvest … travesty all around … look at the effect of Bo’ing’s global workforce … now you won’t even get on their plane and that was all due to H1B abuse … and US worker betrayal.

    • There is fundamental flaw in this argument. First of all the GAO report is 10 yrs old. Much has changed since then. Merely because the job level is not IV, does not in anyway negate a specialty occupation. In fact USCIS backed out of a law suit brought against for taking a position that level 1 does not constitute specialty occupation. Further, a mere look at DoL disclosure of 2019 gives over a few 1000 Level 1 filed by research institutions and universities for Professoriate. So a Ph.D. from Harvard University that joins JHU as an AP is filed at level 1 H-1B just like an IT company filed for a programmer with few years of experience. Likewise a Pharmacologist at MD Anderson is also a level 1. These levels do not represent competency as GAO claims. Instead they are a reflection of experience. DoL’s definition itself is inconsistent. Finally, I think this notion that any H-1B is a brown skinned IT employee who left India to steal job from a well qualified US Worker is nothing but an overgeneralization grounded in nothing more than pure xenophobia. It is difficult to educate people in public policy for ignorance is more common than we can imagine. Besides, it requires both concerted effort to understand public policy and perspective taking at individual level.

  2. Is it possible that Canada doesn’t have enough trained and experienced technology workers? If so, the country can afford to absorb the foreign workers.
    The issue in the U.S. is that there are citizen tech workers who are being shut out of employment, many of those by the H-1B program recipients.

    • Chuck, is either that or Trudeau simply wants to antagonize us by showing the world how nice as a leader he is by allowing these h1b frauds (political posturing in other words). In any case, being indians the bulk of h1b visas, they will not change their ways and will continue to scam IT jobs from canadians as well, will continue hiring other indians only, will continue to create “premier” staffing companies (aka body shops) until canadians get fed up and kick them out, it is just matter of time. Many countries are already taking notice about the way these people operate, on time they will run out of places to go and will have no choice to either go back to India or abide by immigrations laws.

  3. First Canada has only 37.5 million people in the whole country. That is the same population size as California so the immigration policies are more lax. There is also not the professional base that exists in the US. Second the so called diversity only is occurring in the big cities like Vancover, or Toronto. I have a lot of family in Canada and they all are saying Canada needs to wake up to what they are creating. These government sponsored companies in India and China have thousands of people they can send all over the world and once they arrive, it is almost impossible to get rid of them and they immediately applying for citizen status. In addition, they no interest in being a part of Canada they simply see it as a way to make money and send it home to what ever third world mess they came from. H1B has been a disaster from the start built on a false premise that technical expertise does not exist in the host country, total nonsense.

  4. Are these people simply going to Canada (and Mexico) becoming a citizen there, then coming back to the US using a TN visa? (NAFTA allows for these special TN visas.)
    Regardless, for thirty years we’ve had “high skilled” workers undermining pay scales in the USA–to the delight of the business cheap labor addicts.
    There are plenty of US citizens that will do STEM jobs, but perhaps not for as low as 40K-80K in San Francisco or NYC.
    Is it time for the US to add tariffs and higher taxes for those companies that can’t seem to hire Americans? Better yet, the government could fund start-ups in smaller cities and give them government contracts, if they hire Americans of course.

  5. Brian Quinn

    We will have to keep an eye on greedy US companies using Canada as a way around reducing offshoring jobs to other countries here in the US. Greed has no boundaries. Bernie Sanders is not giving away American jobs.

  6. Having personal knowledge of Canadian practices, I can say that in the past Canada did a MUCH better job of vetting their immigrants and while the majority of H1b visa holders I work with here are sub-standard and don’t measure up to their resumes, of the foreign workers I knew in Canada there were only 2 who could be said to be sub-standard. I can only assume the qualifications are not as well checked if so many of the H1b people are able to enter and stay for work. It won’t be long before there are complaints from the Canadians. Remember, when the Royal Bank tried some of the tactics we see int the US and tried to replace Canadians with foreign workers the government stopped it and *apologized* for the situation. Let’s see how well this works.

  7. Tim Edwards

    Thank you, Canada for picking up the H-1 B’s from the US. They left a trail of IT destruction and ignorance behind. they also have way fewer ethics meaning iF one of them is running a large group you can bet that all the people under them will be H1-B. See you in 10 years Canada :-).

    Expect your wages to go down
    Lots of earnings leave the country back to the other countries of origin
    Inability to form a Union
    Subpar work
    Failing networks and infrastructures

  8. Ohhhh, madam Liberty! Save America from these bunch of hatreds and have a reason for your presence. I am too much worried about the future and the future generation on how these guys transform them into if we keep maintaining the silence. These guys talk as if they are lawmakers and assembled here to create laws for America’s future forgetting the fact lot of their families are still living in Canada for some. Being a foreigner I have the confident that I and my kids have a great future here if we continue do the hard work but why don’t you guys have that confident and always live in fear and make others fear? Be nice and let your kids be nice. Don’t work hard for spreading negative thoughts.

  9. The filth of hatred towards foreigners is amazing on this page. The world we live in is a global community and people will move around. You guys are talking as if you just magically appear from a rats ass.