Microsoft Lobbied for More H-1Bs Before Announcing Layoffs

According to a Business Week article, Microsoft posted a policy proposal on Barack Obama’s transition website on Jan. 5 requesting that his administration remove the caps on visas for high-skilled foreign workers. The company announced just 17 days later that it was planning to eliminate 5,000 jobs as well as contract jobs.

Unemployment rates in the United States hit a 16-year high in December of 2008 when the rate reached 7.2 percent. According to a Chicago outsourcing firm, job cuts by tech companies increased by 167 percent in the second half of 2008. There were 186,955 jobs cut in the telecommunications, comupters and electronics industry in all of 2008 up 74 percent from the previous year.

 Yet compnaies like Microsoft continue their efforts to bring in skilled foreign labor. Their actions prompted a letter from Iowa Senator Charles Grassley who on Jan. 22 urged Microsoft to give priority to U.S. workers when considering layoffs.

The current cap on H-1B visas is 65,000 per year. The Department of Labor is responsible for making sure that H-1B visas do not displace American workers. But companies are often eager to hire foreign skilled workers over American workers because they can usually pay them a lower wage. The law requires that companies pay foreign workers under the H-1B program a fair wage, but companies will typically use the lower end of the government wage scale and hire younger workers who will demand less than American workers.

More on this story can be found at Business Week.