The H-1B application process has been known to eat up time, money, and patience. For Hardik Desai, trying to secure an H-1B visa, which allows foreign workers to be employed by American companies, also delayed his wedding plans.
After completing his MBA at Ohio State University, Desai, 28, planned to fly to India to marry his girlfriend in November 2010. Before he left, he received grim news from the U.S. Citizenship and Immigration Services: They had turned down his visa application.
"They said 'it did not satisfy any of the criteria,'" said Desai of his application. He had applied for an H-1B visa to work at IR Diagnostyx, a company he helped start that produces software that can diagnose diseases like irritable bowel syndrome and fibromyalgia. The immigration service had looked at all the positions at IR Diagnostyx and found that the operations analyst job he was applying for was similar to an administrative service manager position that had already been filled, Desai said.
The government is precluded by U.S. immigration law and The Privacy Act from discussing specific cases, a USCIS spokesman said.
"I had already booked the tickets. I did not anticipate the visa would be rejected," he said. After appealing the decision, Desai said he was approved for an H-1B visa in January 2011. But the headaches that came with the application process were enough to make Desai consider moving back to India.
"You come here to get an education, maybe in six-to-eight months you can find a good, proper job. If not, it's not the end of the world. You can go back to India," said Desai, who married his bride in India last month.
H-1B Drop
The H-1B program has been a popular way for American software companies to attract overseas tech talent. H-1B holders are seen as being technically proficient in specialized fields like architecture and computer engineering. They are allowed to work in the country for three to six years and are paid the prevailing wage. H-1Bs were in especially high demand just before the recession hit in late 2008, said Christine Troy, a San Francisco-based attorney.
In April 2008, the quota of 65,000 H-1B visas for fiscal 2009 ran out in just one day as employers rushed to apply, according to records.
"If you didn't file by April 1, the quota numbers would be gone," said Troy.
The number of people and companies applying for H-1B visas fell almost 50% in fiscal 2010, according to recent government figures. While some experts cite the U.S. economy's slow recovery from the recession, applicants and immigration attorneys also blame high costs and increased scrutiny from the Department of State.
"The H-1B visa process is costly, fees have gone up, employers have to pay lawyers fees, and there are far more compliance issues," said Cyrus Mehta, an immigration attorney based in New York City who handles H-1B petitions for clients in software and finance.
Frustrating the Flow of Talent
In 2009, USCIS set up its Administrative Site Visit and Verification Program, an initiative that investigates, often at random, companies that are sponsoring an H-1B candidate to see if it is a legitimate business, said Luz Irazaba, a USCIS spokeswoman. Since its launch, the program has conducted more than 14,000 inspections, said Irazabal. The program was started months after the indictment of Vision Systems Group, a New Jersey-based IT company that prosecutors said paid their H-1B visa-holding employees far below the prevailing wage, among other charges.
In August 2010, Congress passed a law that slapped a new $2,000 fee on the H-1B visa application, in addition to a base fee of $325. All told, extra charges and lawyers fees can cost an applicant or a company as much as $9,000 for each petition.
The fees and the scrutiny may serve as a "disincentive" for companies and potential H-1B applicants, said Mehta.
"A lot of that stuff is very frustrating, and if someone's gone through it once, they may say 'I don't want to do this again," she added.
ThoughtMatrix, a San Francisco-based digital design and development firm, said it had to hand over detailed documents -- including a work chart showing who works at the company and what position they held -- when they put in H-1B petitions for two Indian-born candidates. The Department of Homeland Security sent the firm a letter stating that the vacant position of Unix systems administrator, a job that one of the H-1B candidates was up for, did not require a bachelor's degree, contrary to what the firm put in its job description.
"We had to go through a process of trying to explain to them why it did require a bachelor's degree, and there were a bunch of hoops we had to jump through," said Trevor Fagerskog, co-founder of ThoughtMatrix.
For ThoughtMatrix, both of its H-1B petitions would eventually be approved, and Fagerskog said he would apply for H-1B workers again should the chance presents itself again.
"It's easier if you're a citizen of the United States, or you already have a right to be here with a green card. But if that person is the best person and they need to get a H-1B, we'll go through the process again," he said.
American Dream Disappearing Act
The drop in H-1B visa applicants could also be a sign that America is no longer seen as the final destination for foreign-born tech talent, said Vivek Wadhwa, a visiting scholar at the University of California-Berkley who studies immigrant entrepreneurs.
"A decade ago, if you were a foreign national this was it," said Wadhwa. "You would do everything you could to stay here permanently."
That's changed. A recent Kauffman Foundation study conducted by Wadhwa of 1,224 foreign nationals studying in the United States before 2008 found that 60% of Indian respondents and 90% of Chinese respondents said that economic opportunities in their home countries were a strong motivating factor in leaving the United States.
Wadhwa estimates that 150,000 highly skilled immigrants have returned to India and China in the last two decades. Almost 135,000 Chinese students have returned to China from the U.S. in 2010, a 25% increase from the year before, according to data released by the Chinese Ministry of Education.
"You have the cream of the crop coming over here getting educated, getting experience over here, and suddenly they become much more marketable and can do [just] as well anywhere else," said Wadhwa. And when they graduate, they are more likely to want to start their own tech companies than to join an American one, said Wadhwa, whose latest report is titled "Losing the World's Best and Brightest: America's New Immigrant Entrepreneurs, Part V."
Mumbai-born Anuj Agarwal completed his masters in computer science at the University of Southern California in 2008. He returned to Mumbai to start Nachofoto, a semantic search technology startup that also has an office in San Francisco. But a lack of a visa -- he has not sponsored himself for an H-1B -- has prevented him from visiting his own office in the U.S.
"My customers are in the U.S., like Yahoo, Bing and Google," said Agarwal, 26. The visa issue has forced him to conduct much of his business from afar.
"It's getting so difficult working from here, because those guys are calling me there to come over there and give a demo," said Agarwal. He's hired consultants to pitch Nachofoto to potential buyers in the United States, but he says "I badly need to be there."
What would help people like Agarwal would not be the H-1B, but the proposed Startup Visa Act of 2011, said Wadhwa. The act would give two-year visas to immigrant entrepreneurs who can raise a minimum of $100,000 for a startup. The Act, which was introduced on March 14, still has to go through both houses of Congress.
In the meantime, there are still H-1B visas up for grabs. Some 51,400 out of 65,000 H-1B visas have so far not been issued, according to the latest count by the USCIS.
Write to Daniel Edward Rosen here.
