{"id":1989,"date":"2008-01-20T12:33:00","date_gmt":"2008-01-20T12:33:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/h1b-visas-the-12000-question\/"},"modified":"2008-01-20T12:33:00","modified_gmt":"2008-01-20T12:33:00","slug":"h1b-visas-the-12000-question","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/h1b-visas-the-12000-question\/","title":{"rendered":"H1B Visas: the $12,000 question"},"content":{"rendered":"

You may recall the feisty debate on the H1B Visa and outsourcing issue here<\/a> and here<\/a> last year.  With the 2008 campaigning now in full swing, the "O" issue is noticeably absent from the candidates’ agenda and our old friend Lou Dobbs<\/a> is waiting in the wings to shoot pot-shots at any of the candidates who say anything that remotely supports offshoring, outsourcing or increasing H1B visas.  Step up Hillary Clinton (see video clip below, taken from Lou Dobbs’ CNN show last year).<\/p>\n

Yes, she’s supporting Silicon Valley businesses and has them contributing substantially to her campaign, but at least she’s openly discussing the issue and – more importantly – attempting to tie together the realities of outsourcing, offshoring, immigration and the need for the US government to invest in developing technical and engineering talent.  I respect Lou Dobbs a great deal – he’s a passionate man who sincerely believes in his vision for American workers, has a great sense of humor, and conjures up some excellent – and entertaining – political discussion.   However, this H1B argument just isn’t holding up.  <\/p>\n

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One key reason is the fact that the average salary differential between a "domestic" worker and his\/her supplanted job to an H1B worker is….$12,000 per annum.  Having advised on several offshoring and outsourcing engagements over the last three years, I can state categorically that I have yet to see companies go through an offshoring or outsourcing process – driven by the goal of cost containment – at such a low cost-saving per FTE.  Most companies will not entertain outsourcing business cases if they cannot achieve cost savings in excess of 25% from their original budget – it’s simply not worth the transition cost, complexity and risk to many firms.  I would add that some companies have moved into outsourcing engagements at cost-savings lower than 25% from original budget, but their reasons for outsourcing were nearly always driven by motives beyond mere cost-reduction (for example, the need to re-design and standardize processes and drive rapid change to their enterprise that an outsourcing environment could bring).  Bottom-line, most companies can’t be hiring H1B workers for the sole purpose of saving a few bucks… they generally need these staff.  More key points regrading this issue:<\/p>\n