Renowned Portland consulting firm Ziba Design draws inspiration from around the world for its work, dreaming up imaginative food packaging, kitchen appliances, electronic gadgets and vacuum cleaners.
And it hires from around the globe, too – nearly 10 percent of its 75 Portland employees come from other countries. They work on a class of visa known as an H-1B, meant to allow foreign workers with highly specialized skills.
Christof Mees.
“If you want to innovate something meaningful, you have to have more than one perspective in the room,” said Ziba chief executive Christof Mees, himself an immigrant from Germany.
So Ziba, along with Intel, Nike and many other large Oregon employers, is watching closely as the Trump administration contemplates overhauling the program. Those businesses defend the visas as essential to their research and say the U.S. doesn’t issue nearly enough visas to meet their needs.
The visas infuriate many information technology professionals, however, who charge that some employers abuse the program. They focus their ire on Indian outsourcing firms, who use an outsized share of visas in Oregon to import contractors from overseas for comparatively unsophisticated technical work at the low end of the H-1B pay scale.
Oregon H-1Bs, by the numbers Total, 2016: 4,135 applications certified (number of visas actually granted is likely lower.) Oregon’s total nonfarm employment was 1.9 million in 2016. Average wage: $77,488 (many employers submitted a wage range for certain jobs; this average reflects the bottom end of that wage.) Oregon’s average wage in 2015 was $48,312. Note: Data is for visas certified by the U.S. Department of Labor. Some visas are not issued.
Longstanding tensions over the program have only grown amid a larger immigration debate under President Donald Trump, who has sent contradictory signals on the visa program. A draft memo leaked last month was followed by silence from the Trump administration, leaving workers in the U.S. and abroad – along with their employers – confused about what’s coming next.
So companies like Ziba, alarmed by the new administration’s overall approach to immigration, are coping with an uncertain future. Mees said he relies on a staff that includes people from Britain, Korea, Japan and elsewhere to bring insight from a variety of cultures.
“You can’t be innovative without diversity,” Mees said.
Overall, H-1B visa holders represent a tiny share of the American work force: They’re capped by law at 85,000 per year, with recipients chosen by lottery. Fewer than 40 percent of applicants actually receive visas.
Companies typically pay several thousand dollars in legal and government fees for each H-1B visa, and must pay their workers a “prevailing wage” for each occupation.
But those jobs are concentrated in technology, one of the nation’s hottest sectors, with companies like Google, Microsoft and Intel topping the list of visa sponsors.
Relative to other states, Oregon employers do not use a high volume of H-1B visas. The Department of Labor says it certified 4,135 applications from Oregon employers last year – though the number of visas actually granted is likely lower than that.
Certified H-1B visas in Oregon, 2016 Company, certified applications, minimum average wage
Companies in bold are information technology consultants using outsourced labor. Source: U.S. Department of Labor Note: Visas certified by the Department of Labor are sometimes not issued. Some applications include a range of salary; the average pay reflects the minimum of that range.
That ranks Oregon No. 24 among states, both in the total number of certified applications and certifications per capita. Since the visas typically last for three years, there could be more than 10,000 people working in Oregon on H-1B visas at any given time.
H-1B certifications were for jobs that paid, on average, a minimum of $77,000 annually. That’s 60 percent above Oregon’s average wage for all jobs, reflecting the specialized nature of the work.
Some companies paid considerably more – Intel received 550 certifications last year for Oregon, the most of any company in the state, for jobs paying an average minimum of $90,500. The chipmaker is among the nation’s largest users of H-1Bs, with 1,836 visa applications certified in 2016 alone.
At top engineering schools such as MIT, Caltech and Stanford, more than 40 percent of graduate students are from other countries. At Portland State and Oregon State, more than half of graduate engineering and computer science degrees go to international students.
Intel has long maintained that the H-1Bs are essential to its business, especially given the dearth of advanced engineering degrees awarded to Americans at top research universities. The chipmaker has cultivated ties to Trump since his election last fall, and Intel CEO Brian Krzanich says H-1B visas are a key reason why.
“We believe that we must be part of the conversation to voice our views on key issues such as immigration, H1B visas and other policies that are essential to innovation,” Krzanich wrote in a letter to employees after he made a surprise visit to the Oval Office last month.
Intel declined additional comment, as did Nike, which had more than 100 H-1B applications certified last year. And several H-1B holders in Oregon also declined to comment, either directly or through their employers or attorneys, citing concerns about how immigration authorities might react to any public comment in Oregon.
But Oregon Health & Science University, which employs about 150 H-1B visa holders among its 15,600 Portland workers, said the program is an essential part of its operation. The university says they’re usually working on federally funded research projects, hired for specialized knowledge of research topics including HIV vaccines, cancer and cytomegalovirus.
“These people are usually either medical residents, postdoctoral students or physicians who are being recruited here for their specific skill set,” said vice provost David Robinson.
Intel, Nike, OHSU and Ziba are some of Oregon’s best-known names. But if you look at the list of top H-1B visa certifications in the state, many of the recipients are companies most Oregonians have never heard of.
They have names like Infosys, Wipro, Tata and HCL. They’re outsourcing companies from India that contract with large corporations to help manage their internal computer systems, a class of job known as information technology. That is relatively straightforward technical labor, very different from the kind of highly specialized design work at Ziba or cutting-edge research at OHSU.
Among the top 20 companies that had H-1Bs certified in Oregon last year, three-quarters went to these IT outsourcing companies. On average, the outsourcers paid just over $70,000 annually – 10 percent less than direct employers’ H-1Bs.
That’s where the main tension around the visa program emerges. Information technology workers complain the outsourcers bring thousands of workers to the country every year, inflating the labor pool and depressing wages.
In high-profile cases at Disney and Southern California Edison, large companies laid-off American workers and replaced them with foreign contractors.
Foreign contract employees often work at the very same companies that hire visa holders directly. Oregon’s largest concentration of these contract workers is in Hillsboro, where Intel has three large campuses. (Intel would not say whether it uses Oregon’s largest outsourcing firms, the Indian IT contractors Infosys and Wipro.)
Portland immigration attorney Jimmy Go says the outsourcers operate differently than companies looking to hire foreign workers directly, so it’s time to stop treating them the same way. He suggests two different classes of visa for two different types of jobs.
“One key part of the solution is that the H-1B visa category needs to be bifurcated,” Go said.
Trump has sent contradictory signals on H-1Bs, declaring during the campaign that “we need highly skilled people in this country” – but also stating that “companies are importing low-wages workers on H1-B visas to take jobs from young, college-trained Americans.”
To Lisa Ellis, a senior analyst with Bernstein Research, such contradictory positions suggest the new president hasn’t given the issue a lot of thought and hasn’t made it a priority. She doubts much will change under the new president.
Any edict from Trump is unlikely to be as sweeping as last month’s temporary ban on immigration from seven predominantly Muslim countries. Much of the H-1B program is enshrined in statute, so the president would need congressional authorization to make fundamental changes.
A draft executive order on the H-1B program began circulating last month, but Trump still hasn’t issued an official order. That leaves employers and workers scratching their heads, trying to plan for an uncertain future.
“The language of the leaked order, the language that was in the press, was fairly benign,” Ellis said. “It doesn’t actually tell anyone to change anything, per se.”
However, the president does have authority over implementing the rules and might be able to tighten requirements over wages or qualifications. And members of Congress from both parties are considering legislation to enact similar reforms.
“I get the frustrations that people have that the H-1Bs are coming and taking their jobs,” said Portland immigration attorney Brent Renison said. However, he said if the visas also provide very real value to U.S. companies that might otherwise move their research work abroad.
It would be perfectly sensible, Renison said, for the new administration to evaluate wage levels in the program or to limit the number of visas awarded to outsourcing companies. But he said early signals from the administration suggest a less constructive approach.
“The question is: What are they going to do to correct these abuses without destroying the whole system?” Renison said. “I’m not entirely confident they won’t do the latter.”
The Oregonian/OregonLive data editor Melissa Lewis contributed to this report.
— Mike Rogoway; twitter: @rogoway; 503-294-7699
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