No Hiring New H-1B Visa Holders For The Next 15 Months

“Companies that didn’t file a visa petition before this week must wait until April 2013 to try again and won’t be able to employ an H-1B worker until October 2013,” explains the San Jose Mercury News.
Why is that?
U.S. Citizenship and Immigration Services just announced, “On
June 11, 2012, USCIS received a sufficient number of petitions to reach the statutory cap for FY 2013. On June 7, 2012, USCIS also received more than 20,000 H-1B petitions on behalf of persons exempt from the cap under the advanced degree exemption. USCIS will reject petitions subject to the cap for H-1B specialty occupation workers seeking an employment start date in FY 2013 that are received after June 11, 2012.”
It will still be possible for those already in H-1B status to change jobs to another employer or for someone to obtain a new H-1B visa to work at a university or nonprofit research institute. But other than in such circumstances and perhaps a few others, such as transferring in existing employees from abroad on L-1 visas, the door is effectively shut.
Some would respond: “This is good, now more Americans will be hired.” Things aren’t so simple.
The law of unintended consequences tells us that unexpected things happen when government laws interfere with the natural flow of economic activity. Economist Mark Perry, citing James Gwartney, recently described an example of unintended consequences on his economics blog Carpe Diem:
“In the former Soviet Union, managers and employees of glass plants were at one time rewarded according to the tons of sheet glass produced. Not surprisingly, most plants produced sheet glass so thick that one could hardly see through it. The rules were changed . . . Under the new rules, Soviet firms produced glass so thin that it was easily broken.”
Preventing U.S. employers from hiring skilled foreign nationals, including recent graduate students in engineering and other tech fields, inside the United States encourages opening offices and expanding resources for placing foreign-born personnel outside the United States. It could also discourage more investment in the United States. Small employers unable to find the right skilled people may simply grow less.
In a study for the American Enterprise Institute and the Partnership for a New American Economy, economist Madeline Zavodny found a connection between companies hiring H-1Bs and overall employment: “The data show that states with greater numbers of temporary workers in the H-1B program for skilled workers and H-2B program for less-skilled nonagricultural workers had higher employment among US natives. Specifically: Adding 100 H-1B workers results in an additional 183 jobs among U.S. natives.”
Others might say: “I don’t mind foreign nationals working in the U.S. but it’s better if they worked on green cards.” Yes, it would be ideal if employers could sponsor valued individuals for permanent residence in a timely fashion. Unfortunately, that is easier said than done.
A new report from the National Foundation for American Policy found, “Over the past several months, skilled foreign nationals have seen no improvement in their prospects for obtaining green cards and, in fact, wait times are likely to increase in employment-based immigration categories.” An earlier analysis by the National Foundation for American Policy concluded (in October 2011) that wait times for employment-based green cards sponsored today can last 5 years or even decades, depending on the category and country of origin.
A 15 month moratorium on hiring new H-1B visa holders will hopefully at least lead to a moratorium on blaming skilled foreign-born scientists, engineers, and other professionals for economic problems in the United States. If history is a guide, we shouldn’t count on it.

-Forbes