Business groups advocating for expanding the H-2B visa program argue that the program is essential to filling labor shortages with low-skilled temporary guestworkers. However, a new analysis by Economic Policy Institute Director of Immigration Law and Policy Research Daniel Costa demonstrates a lack of credible evidence that labor shortages exist in the industries that employ H-2B workers. The real reason behind businesses’ support for the expansion of the H-2B program, Costa argues, is that they are able to pay H-2B workers less than comparable U.S. workers.
Costa examines trends in employment and wages in the top 15 H-2B occupations over the past decade. If there were genuine labor shortages, one would expect to see low unemployment and rising wages. Instead, despite above-average employment growth in some of the top H-2B occupations, wages have been stagnant or declining and unemployment has been persistently high in all of the top 15 H-2B occupations. This suggests that there are no labor shortages at the national level in these occupations.
“It’s clear that there aren’t national-level labor shortages in H-2B jobs that would justify expanding the H-2B program or watering down rules requiring that employers first recruit U.S. workers before hiring an H-2B worker,” said Costa. “Members of Congress and the administration should take claims to the contrary from employer groups and corporate lobbyists with a grain of salt.”
In the overwhelming majority of cases, wage rules allow employers to pay hourly wage rates to H-2B workers that are far lower than state and national averages. As a result, employers save several dollars an hour by hiring a lower-paid H-2B worker instead of a U.S. worker earning the local average wage for the occupation. This suggests that the below-average wage rates employers are allowed to pay H-2B workers are too low to attract U.S. workers, and thus not high enough to ensure compliance with the requirement that an H-2B worker not be hired unless “unemployed persons capable of performing such service or labor cannot be found in this country.”
Costa also criticizes the use of private wage surveys for setting H-2B wages. Evidence clearly suggests that the shift to the use of private wage surveys was a systematic response by H-2B employers to keep wages lower than the average wage rate set by the Department of Labor’s Occupational Employment Statistics, which would otherwise be required under 2013 and 2015 updates to the H-2B wage rules. Fiscal year 2016 appropriations legislation recently passed in Congress broadly permits the use of private wage surveys to set H-2B wages, with the result being continued downward pressure on the wages of workers employed in construction, landscaping, forestry, seafood, and hospitality.