The H1B visa program only serves to depress wages, take advantage of foreign workers, and eliminate the high-tech advantage that the US has developed over decades.
Its imposing a positive skew to the salary distribution.
Many aspects of the H1-B suck. The same is true for their European and Asian counterparts. Just eliminating non-immigration visas would not solve the problem in a highly-integrated world-wide economy - it would make things worse.
This.
The H1B program is essentially indentured labor.
Surely if a company says they want to employ a specific person, and that person is the best for the job, that should be enough?
Do you trust a government minion to competently assess either A) this highly specialized person's skillset, or B) the forthrightness of the applicant company's statements?
Sometimes an emperical "good enough" on the international scale is the best you're going to get. In the case of H1B visa program, from the host country's view, lowering the bar will increase the administrative overhead in a system where one could instead apply any increase in administrative capacity toward the already largely exluded applicant pool with high caliber credentials.
However, only one of the reasons. I did not necessarily want to stay forever, just like I didn't want to stay forever in London (no restrictions for an EU citizen).
Also, I just don't see the wage-depression, at least not in any of the cases I am aware of (and there were quite a few at the companies I was working for in the Bay Area). I remember one smarty-pants ranting about H1B wage-depression after an otherwise fun EE380 session. I challenged him to guess my salary. He was off by a factor of three.
And not for lack of trying, IBM, Google, Microsoft, and many other tech giants have subsidiaries here in Brazil for example.
Yet, everytime you hear about a brazillian that achieved something great recently, was NOT inside Brazil.
I can tell you, my personal reasons why I don't even applied to MS, IBM, etc here in Brazil: You have all problems of working in a big corporation, yet the pay is still terrible.
But I DID applied for US MS for example, because although it obviously has the same problems as working in BR MS, the pay is much, much higher (inside MS itself the US pay is about 4 times the BR pay for a entry level position).
Thus the best talent from Brazil (or India, or China) don't stay in their countries, they end leaving their countries, even if to work in companies that do exist in their countries, seeking a better life.
Now, why MS US and MS BR has so drastic pay gap? Basically, because of the things that made the US a great place to create startups in first place: much less regulation in general, much less corruption, and better infrastructure, in Brazil the mininum costs of running a company, without counting the employee wages, is so high, that not much money is left to actually pay the employees, we call this here "Brazil Cost".
Some examples: Brazil is the country in the world that is most complicated to pay the taxes, as result is the country where companies use a largest portion of their money paying accountants and tax lawyers.
Brazil has second highest taxes of the world (first place is Sweden).
Yet Brazil security, roads, etc... suck, to the point that most big companies in Brazil are concentrated in a private-built city named AlphaVille, companies and rich people living in AlphaVille built with their own private money their streets, guard stations, walls, electricity lines, etc... and pay with their own private money for cops, schools for their children, firefighters, etc... And STILL pay all the taxes normally too, as you can expect, running a business there (or living there) is crazy expensive.
Yet running our business there, is a necessity, when you have people assaulting business in São Paulo and Rio using heavy military weapons (even Bazookas were witnessed), you have no choice but to run your business in a private ran fortress, and pay everything doubled (once in form of taxes, and once in form of private contracts that actually solve your problem).
Obviously it's a complex topic, but why are you so sure?
Why is the competition "unfair"? If it's unfair because we don't offer "social programs such as free higher education", then the solution ought to be offering those programs, not hamstringing US companies.
There'd be a one-time cost to creating a campus in India, but honestly, it would be more than compensated for by the fact that they could almost certainly pay Indians in India a considerably lower wage than Indians in the Bay Area.
The reason they don't make their major campuses in other countries versus the US is because they feel that they have talent that is determined to stay in the US and which will not cross-pollinate well with physically remote offices, not because they think that it is cheaper to employ foreigners in the US than it would be in their home countries.
This has resulted in industries being shut down at a massive scale in US where labor costs are higher and moved to a country where labor is cheap (China, India and so on) and also less regulated ("flexible" is the word used). As a bonus companies get to flout just about every environmental regulation which are non-existent in third world countries (think Bangladesh's textile manufacturing plants producing for luxury brands).
The net result of this combination of "free capital movement + restricted labor movement" is reduced wages across nations and industries. And over the time you end up having no skilled labor in a company's nation of incorporation (Apple?).
The supreme irony I see here is that the advocates of "free market" for capital tend to advance amazingly absurd arguments when it comes to having a similar free market for labor.
I highly recommend watching this talk by Noam Chomsky titled "Free Markets?": https://www.youtube.com/watch?v=WHj2GaPuEhY
Additionally, it's my understanding that getting a shot [1] at the big leagues in law requires a top-12 school. Are mid-tier law schools pumping out lawyers who make $150k as first year associates? I'd be surprised, but I don't have the data.
[1] Even attending a top school is no guarantee. Law school is fiercely competitive, and only top-scoring students from top schools get the really lucrative & prestigious positions.
You seem to be missing the economic realities at play. The cost of law school does not matter. All that matters is the supply and demand for lawyers and programmers. And if you've been keeping your ear to the ground, you may be aware that there is a significant oversupply of law grads nowadays.
There is no economic law that says that lawyers should make more money than programmers because they choose to be ripped off in pursuit of their training. If in the future, the salary of the average lawyer were to drop below that of the average programmer, Adam Smith would not bat an eye.
"There is no economic law that says that lawyers should make more money than programmers because they choose to be ripped off in pursuit of their training."
You don't NEED a degree to do programing. Arguably a computer science degree is standard but even then, you don't need 7 years of schooling. In order to be a lawyer, you need to complete law school.
At the end of the day, it's fair for a lawyer to charge more. Why? Because someone is willing to pay the premium.
From the company's perspective, whatever an individual put into their experience is almost completely inconsequential if they are doing their job. In a healthy, functional market, pay isn't about "fairness", it's about bottom-line results, and programmers and engineers make the products and services these companies use to generate revenue which in turn creates demand and subsequently the available funds for legal counsel!
I don't think that's how capitalism works. Your pay doesn't scale with your value, otherwise teachers and firefighters would be making bank. It's completely guided by supply and demand.
EDIT: Let's consider that "supply and demand" has artificially increased the price of programmers above their value. It's now a losing proposition for a company to continue to employ a programmer as the company is losing money, so the demand goes down and with it the price.
Conversely let's consider that the price of a programmer is artificially lower than his value. Any new company can come along and pay a bit more (but still less than actual value, for now!) and attract the best programming talent. Other companies must keep up in order to keep the talent, so the price returns to the actual value to the company.
Uh, no, that is not how supply and demand works. See <http://en.wikipedia.org/wiki/Economic_surplus>.
The gap between what people are willing to pay vs. what people are willing to sell for is often substantial. People spend a lot of time fighting over the distribution of the value in that gap between consumers and producers (see, e.g., price discrimination).
Replace x with "fair salaries" and "y" with "Tech companies making non-poaching agreements"
The CEO is essentially the face of the company when things happen (good or bad) and has huge responsibilities. Managing a company is easy from the armchair.
As far as lawyers are concerned, their wages just reflect the fact that they (should) have been trained as A-list negotiators, and it is common practice for lawyers to have a fee based on a percentage of the deal they negotiated.
There is a corollary for programmers for the above: start-ups. Though not trained negotiators, skill and work ethic can get you far enough. And it is common practice to receive a percentage of the reward.
The grass always looks greener on the other side.
Not in California.
So, you _do_ need to 'attend' law school, even if it's over the internet. (Unless you "study in a law office or judge’s chambers", which I guess is a type of apprenticeship.)
Though there are successful independent lawyers. And an awful lot of unsuccessful ones.
Despite the expense of law school, there are about 25-35k jobs per year for 40-45k graduates per year. And maybe 5k per year of those pay the kind of salaries people think lawyers make. What keeps supply limited in law is that the growth of supply is gated by the amount of legal work in the economy. Law is unlike engineering in that nobody wants to hire fresh grads. They want the seasoned veterans who have been to trials or handled a big deal. Preferably a bunch of them. There is only so much of that work to go around, which bottlenecks the supply pipeline in the stage between fresh graduate to employable lawyer.
The moral of the story is that economic systems are more complicated than simple neoclassical tropes admit.
Education in the ingenious arts, and in the liberal professions, is still more tedious and expensive. The pecuniary recompence, therefore, of painters and sculptors, of lawyers and physicians, ought to be much more liberal; and it is so accordingly.... We trust our health to the physician, our fortune, and sometimes our life and reputation, to the lawyer and attorney.... Fifthly, the wages of labour in different employments vary according to the probability or improbability of success in them. The probability that any particular person shall ever be qualified for the employments to which he is educated, is very different in different occupations. In the greatest part of mechanic trades success is almost certain; but very uncertain in the liberal professions. Put your son apprentice to a shoemaker, there is little doubt of his learning to make a pair of shoes; but send him to study the law, it as at least twenty to one if he ever makes such proficiency as will enable him to live by the business.
http://www.gutenberg.org/files/3300/3300-h/3300-h.htm#link2H...
SUPPLY SIDE: "send him to study [x], it as at least twenty to one if he ever makes such proficiency as will enable him to live by the business." He is making is quite clear that the supply of qualified [x] is low (and giving a reason as to why it is low, but as Adam Smith himself would surely admit, the laws of supply and demand do not [directly] care about the 'why').
DEMAND SIDE: There is no explicit mention of the demand for these services, but as educated readers, we are able to deduce that during the time of Adam Smith, the demand for certain [x] heavily outweighed the supply.
*[x] blocked out because its specific value is not germane to the underlying logic of the argument.
You cannot turn this quote into a formula, because it's a description of how wages ought to be, and the reasons therefore. And it is completely irrelevant to discussion, as I'm sure if Smith were alive today, he would count the art of programming among the liberal professions. There is more to making a useful application than to be able to think mechanically. Because programmers create and shoemakers copy.
Of course, today you could point to a plethora of professions for which a long and expensive education is required, but for which compensation lags, often painfully. Though in some cases job security may be higher.
It is true that a tiny number of lawyers make a lot of money straight out of school, but as noted their numbers are small and their hours (and often lives) awful.
That said is more than obvious that in a digital world the future belongs to developers, because the demand for them will go up, it's inevitable.
Mid-tier law schools are definitely not pumping out lawyers who make $150k as first year associates. Even coming out of a top-20 school, you have to be ~top 20% to be competitive.
High cost of law school can only impact the supply side of lawyers. One need to understand trends in both demand and supply of these professions to get the larger picture.
Law school is competitive and software is not, will not be a valid argument that can justify higher salaries of lawyers.
In the same vein if you raised the salaries at certain large faculties the technology degrees may end up competitive as well.
Also, the opportunity cost for law students is different than it is for engineers, since you can attend law school with a degree in art history.
When I was in grad school in engineering at UC Berkeley, I saw the average salary for MS and PhD level graduates relative to law and MBA programs in various surveys. It was pretty remarkable - not even a PhD in CS matched the average salary for a JD or MBA out of Boalt and Haas, respectivel. This was just during the first dot com boom, when silicon valley companies were lobbying congress for an increase in visas due to a severe shortage of UC citizens pursuing these degrees.
I always wondered why this question so rarely came up during the debates - why do you think you should be able to hire someone who majored in physics and went to 6 years of a PhD program in EE for 2/3 of what people are paying top law grads? I remember one part of a floor debate with Feinstein and a biotech CEO - the CEO was trying to get someone with a PhD in Biology with a focus on genetics, unix ability, and programming skill - and couldn't find one in spite of offering 90K, stock options, and a "lease on a new BMW" (which makes it sound like they're giving a BMW, but really they're just letting the worker drive it, a perk probably worth about 6k a year). Feinstein replied "what was the name of your company again?" and everyone laughed. Feinstein didn't say "why do you think you can hire someone like this for 2/3 the starting salary of an art history major with a law degree that can be completed in half the time with 1/50th the attrition rate?"
I get the feeling the gap isn't as pronounced as it used ot be, but it is still a good question for framing this debate.
http://en.wikipedia.org/wiki/List_of_law_firms_by_profits_pe...
This is as opposed to finance, where even associate level positions will generally pay a large portion of total compensation in the form of an annual bonus, tied to the firm's performance. In a good year, these can exceed 100% of base salary after a few years of experience, but this is not the case for any non-partner lawyers I know of.
The response: 'Not according to your billable hours.'
Pretty interesting reading:
http://www.skadden.com/sites/default/files/ckeditor/files/Ho...
Traditionally, in the US, the law professions have restricted the entry of new lawyers into the market. This has artificially inflated prices for lawyers. They do this by folding in layers of complexity into the law, by imposing greater restrictions on the practice of law, and by imposing huge costs on participation.
Also, since in the US, most legislators are also lawyers, they have innate incentive to add more and more complexity and requirements into the law. More complexity and requirements increases the demand for lawyers.
I agree that the practices were unethical, illegal, and infuriating as a developer, but it is an enormous jump to claim that the actions of several Silicon Valley companies lowered industry-wide wages by tens of thousands of dollars per year.
I don't even know how to begin calculating this cost to your typical dev, so I couldn't say whether tens of thousands is or isn't in the ballpark, but I feel pretty secure in theorizing that there is an impact.
One funny thing about making the engineer-to-lawyer comparison regarding this salary fixing issue is that law actually has a much more obvious salary fixing problem, since almost every biglaw firm pays 160k and firms don't tend to compete for entry-level hires with compensation.
And I think you misunderstand how big companys set wages - they use some very secretive "surveys" which they do not share with the employees to set the quanta for pay increases.
Illegally colluding. The only reason they hire people is to make money. If they think paying more for employees will raise salaries all round and cause them to loose profit, they won't do it. It was cost benefit analysis.
And you're basically right, it was a cost-benefit analyses. And it was illegal to act upon it the way they did, which is the whole point.
But those sort of jobs dont face a lot of the issues that come with professional ones - if your a docker you boss is not going to trick you out of your vested stock and cost you millions ala silver lake partners.