Coping with H-1B Shortages: Firm Performance and Mitigation Strategies
The United States' H-1B visa program, which allows private firms to hire highly skilled foreign workers, was so severely over-subscribed in the years since 2014 that H-1B status was distributed by lotteries to a subset of applicants. Using data on H-1B applications and on a range of outcomes for publicly traded companies, we find that employers using the H-1B program experienced reduced employment, sales and profits, compared to non-users in the years since 2014. We also find that some employers anticipated the rationing of H-1Bs and retained a larger share of H-1B workers, mitigating the damaging effects of H-1B rationing on their performance.
The authors gratefully acknowledge funding from the National Science Foundation, Award 1535723, "The Effect of H-1B Workers on the Innovation and Productivity in US Firms." The grant was functional in developing the data used in this paper. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.