What Amazon, Google H-1B Workers Earn Over the Prevailing Wage

The U.S. Department of Labor (DOL) is arguing that the “prevailing wage” for H-1B workers has been set far too low, allowing companies to use the visa to replace domestic technologists.

That argument comes as part of the DOL’s sweeping attempt to redefine the parameters and salary of the H-1B visa. This Interim Final Rule, which may go into effect within weeks, will require H-1B applicants to have a college degree in their actual field, shorten the visa lengths for certain kinds of contract workers, and boost the salaries that employers must pay their H-1B workers. 

The DOL broke down what some of the largest corporate users of the H-1B program pay visa applicants, and then compared that to the prevailing wage rates for H-1B workers. Here’s that chart; as you can see, some firms (such as Amazon and Google) pay significantly above the prevailing wage, while others (such as Oracle) are almost level:

“If the Department’s current prevailing wage levels accurately reflected earnings for similarly employed U.S. workers,” the DOL wrote, “then these major differences between actual wages paid to some H-1B workers and the otherwise applicable prevailing wage levels would not be as common.”

If the wages are well about the prevailing wages, according to the DOL’s logic, then the latter is too low, and “thus can be abused by other firms to replace U.S. workers with lower-wage foreign workers in cases where those firms do not have similarly employed workers on their jobsites whose actual wages would be used to set the wage for H-1B workers.”

As you might expect, though, not everyone agrees with the DOL’s decision to radically retool the H-1B visa. In a column in Forbes, Stuart Anderson, the executive director for the National Foundation for American Policy (NFAP), suggests that the Interim Final Rule is basing its arguments off outdated statistics, especially with regard to the unemployment rate.

In essence, Anderson argues that the true unemployment rate among technologists is too low to justify such sweeping reforms, especially if the DOL is basing those changes on the assumption that domestic technologists can’t find jobs. To support that argument, he quotes an NFAP report: “The 4.6% unemployment rate in those occupations has been exceeded in 51 individual months… and the Department of Labor never previously cited it as a reason to issue a regulation to change H-1B prevailing wage rates, including immediately as an interim final rule.” 

Meanwhile, an opinion piece by Nolan Rappaport in The Hill argues that raising the prevailing wage for H-1B visas is the only way to prevent general suppression of salaries for everyone in tech. 

Whether any adjustments to the H-1B’s prevailing wage will “stick,” of course, hinges largely on the upcoming election. Trump’s temporary ban on the H-1B and other visas was struck down recently by United States District Judge Jeffrey S. White’s ruling in National Association of Manufacturers, et al. v. U.S. Department of Homeland Security,forcing a major change in the Trump administration’s overall visa strategy. 

12 Responses to “What Amazon, Google H-1B Workers Earn Over the Prevailing Wage”

  1. Larry Peteet

    Very good information to be aware of here. I am a 30 year Senior Software Developer and have a LOT of experience in the IT industry and also with Onshore H1B developers. Having been and Independent Software Consultant for 20 years; I have seen many times where there are a LOT of H1B workers at companies I worked at. I also know of many American Developers that have a hard time getting a job when they are very experienced and are not even asking for a Top-Level wage. Anyone who looks at how many H1B workers there are in the IT Industry they would be amazed. And they are almost always paid a lot less than a US Citizen from many of my Anecdotal experiences.
    Help the US Citizens first and foremost. Once they are good to go then we can discuss how the laws should affect foreign workers working in the United States of America. If most countries took care of their citizens then that would be a great starting point towards making the world a much better place IMNHO.

  2. Outsourcing

    Look at the peanuts – TCS, Infosys, Wipro, HCL, Accenture Federal Services ( not sure why these get Federal contracts when they hire mostly H1B on all Federal contracts – Public Money wasted on Foreigners ). Just like US banned Huewai networks on national security reasons, should ban Outsourcing on national security reasons. Offshoring has its own downfall – US customer / consumer data, company login credentials, intellectual property, Data center keys, sensitive documents, company information, Data, company code in hands of foreign nationals outside US ? US corporations will learn not to outsource hard way but sure they will learn.

  3. The money most employees make in stock rewards and bonuses is crazy in FAANG. Stock rewards exceed base pay for senior and above, principal make even twice of base pay. Go check teamblind to see current offers developers are getting.

  4. The question to be asked is what would employers be required to pay if the H-1B and other sources of foreign labor not exist? If they are allowed to pay less then American workers are harmed. The nation is also harmed in that the addition wages that would be paid to American workers would act as a Keynesian stimulus to the economy.

  5. GoHKNoCCP

    I don’t believe the claim that company hires H1B workers because they want to cut cost. In fact, most H1B workers at large companies earned their degree from top American universities. Based on what I am seeing, there’s a significant shortage of capable engineers across the tech industry. Many claim that they have many years of experience only to be found out later that they spent the last couple of years writing basic UI code with no depth. Companies should hire based on candidate skills but not nationality. Curbing H1Bs will only help to ship jobs to places like Canada (as it’s already happening with Google, Facebook, Uber). IMO the government should only take out scam companies like InfoSys and Tata and enable more high skilled workers with American degrees to get the visa.

  6. easy to fix the system is make the client to post the job ad, conduct interviews and hire qualified candidate. If a visa holder is hired, submit recruitment results to USCIS.
    Make USCIS funded by government not to depend on visa fee to stop flooding visas and green cards.
    Trump is the only one who is doing great in last decade for Citizens and for the nation, building border wall or stopping few Asia countries to take over control of US businesses and immigration, building economy and creating more jobs even during pandemic all over the world.