>They are just paying the correct price determined by the market for that particular aggregated job function.
If 47% and 85% of H-1Bs at bodyshops are being significantly underpaid compared to their peers, what is your argument that they aren't driving down wages? If these employees weren't on visas, do you really think they would still all be paid below the market rate?
And even still, why are visas for "specialized knowledge" workers going to what you call "maintenance type contracts" for "legacy software"? There's a huge disconnect between the intent and purpose of the visa programs and their actual use.
Who are the peers ? People in similar job functions ? It's very hard to know just by the report. A 'software engineer' job function is the same on paper across Facebook and Infosys. While the software engineer in Infosys is mostly performing maintenance related tasks and nowhere on par with the software engineer in Facebook, talent wise. There are exceptions of course and they always find better jobs.
"There's a huge disconnect between the intent and purpose of the visa programs and their actual use."
Yes absolutely. That's mostly because there is no other legal option for these companies to hire. L1 was an option, but the USCIS hiked L1 fees and it's now very expensive. Also L1 requires the employees to have spent a year at the home branch.
Given how competitive the market for talent is, H1B employees of these companies are always free to find other jobs. Since they already have a H1B visa, transfers are possible. Agreed not all companies will sponsor a transfer but many do. Even startups. Some lower quality body shops try to enforce some 'bonded contract' but that is illegal and will never fly in labour courts.
So no, the outsourcing companies are not underpaying talented people. They are just paying the correct price determined by the market for that particular aggregated job function.