Laid-off foreign workers from US tech companies whose visas depend on their employment are scrambling to find new jobs to avoid being forced to uproot their lives and leave the country.
More than 150,000 US-based jobs have disappeared in recent months, dealing an economic blow to Silicon Valley not seen since the dot-com bubble that burst in the early 2000s.
As the huge wave of layoffs spreads among US tech firms, many of those who have lost their jobs remain in the country on H1-B or other visas that are contingent on their jobs, according to Congresswomen Anna Eshoo and Zoe Lofgren, Of California.
Both wrote a letter urging US immigration authorities to at least double the 60-day period that allows foreign workers, holders of work visas, to get new jobs.
Without a new job at a company that can get them a visa, the laid-off workers will have to leave the country.
“They’re completely panicking,” says Seattle-based immigration attorney Tahmina Watson. “They are at an absolute crossroads because they don’t know what they are going to do.”
According to Eshoo and Lofgren, foreign workers make up almost a quarter of the science and technology workforce in the United States.
Tech employees have often settled and started a family in the United States, their supporters told AFP.
“They went from being two-income families to being families with no income, with mortgages, marriages, car payments and children,” says Watson. “Sixty days isn’t enough time to sort things out; it’s not enough time to find another job and then apply for another H1-B visa.”
The Foundation for Indian Studies and the Indian Diaspora posted a petition on the Change.org portal asking US President Joe Biden to extend the visa grace period by one year for humanitarian reasons.
The petition has garnered more than 2,300 signatures since Wednesday.
“My request here is to increase the grace period and let them resolve,” says the director of the foundation, Khanderao Kand.
Brain drain
The US economy will take a hit if there is an exodus of migrant tech talent, advocates argue.
More than half of billion-dollar tech companies were founded by migrants, Eshoo and Lofgren wrote in their letter to US Citizenship and Immigration Services leaders.
“To ensure that the successful companies of the future are based in the United States, we must prevent this brain drain from happening,” the letter requests.
Silicon Valley is home to many migrants from China, Europe and India, many of whom are not just employees but job creators, with start-ups or investment capital, Kand tells AFP.
Talent forced to leave the United States, who incidentally leaves with their families and dreams, will settle elsewhere and probably won’t return, he warned.
Giving migrant talent a chance to stay could fuel a start-up boom, as some of those laid off are able to start their own companies, Watson says.
The future
“If we lose this talent, I think it will affect us in the future, because these people will realize that they do not interest the United States,” added the lawyer.
Among the tactics used by the newly unemployed is switching to tourist visas, which give them six months to find work or resolve paperwork, according to Watson.
“If they can’t find another job, it gives them time to sell their car, break their lease, do whatever they need to do, or try to get things done to go to Canada. Meanwhile we close the doors to migrants, Canada is doing the opposite by welcoming them.”
While layoffs by tech giants like Alphabet, Amazon and Microsoft are making headlines, younger companies are also laying off people, says Reza Malekzadeh, president of French Tech San Francisco.
“I think culturally Europeans are not used to that, especially the French, because they are not used to being fired easily,” Malekzadeh said.
“We try to help each other. I haven’t seen a big wave (of migrants) back to France yet; I think they still have hope.”
Unemployment
On the other hand, in the latest unemployment reports, the labor market exceeded all expectations in January in the United States and showed iron health, despite fears of an economic slowdown and tens of thousands of layoffs in the technology sector, which did not prevent unemployment from reaching its lowest level since 1969.
In the first month of the year the world’s largest economy created 517,000 jobs, the Labor Department announced Friday.
It is almost double that in December, when 260,000 jobs were created, according to upwardly revised data also published this Friday.
Analysts had expected almost a third of the result announced for January: 187,000 new jobs, according to the consensus compiled by Briefing.com.
With these numbers, the unemployment rate, which had been at its pre-pandemic level for several months (3.5%), the lowest in 50 years, falls even further, to 3.4% of the population economically active. The specialists expected an unemployment rate of 3.6%.
“The increase in employment was across the board, in the leisure and hospitality sector, professional and business services, and health care. Employment also increased in the public sector, partly due to the return of workers after a strike,” details the Department of Labor in its statement.
The employment market seems to be in iron health, despite the cooling of the economy caused by the increase in interest rates by the Federal Reserve (Fed, central bank), which tries to contain inflation by making credit more expensive and discouraging as well as consumption and investment.
On Wednesday, the monthly ADP/Stanford Lab survey had reported a sharp drop in the volume of jobs created in the private sector compared to December, mainly due to unfavorable weather conditions, with floods in California and snowfall in the center and east of the country.
But “we see a still strong job market outside of the weather,” ADP chief economist Nela Richardson said in publishing the report.
The rising rates are, however, having an effect on the rise in wages, which is moderating.
For almost two years, due to labor shortages, companies have to propose higher wages to attract or even retain their employees, in the midst of escalating inflation.
Higher wages push up prices in the economy.
The so-called “great resignation” saw millions of people leave their jobs to seek better conditions in other companies.
Layoffs
Amid these difficulties of a tight job market, companies are trying not to lay off employees they had a hard time getting and spent money training.
The exception is the technology sector which, after hiring massively since the pandemic began due to the increased demand for online services, backtracks and announces layoffs by the thousands, from Alphabet to Amazon, passing through Meta and Microsoft.
Other companies in other industries are also beginning to make announcements about job cuts, such as the shipping firm FedEX or 3M, with much demand for its services and products during the pandemic, and even the business bank Goldman Sachs.
Despite these very high numbers of job cuts, “the layoffs as a whole (…) are few and the ones we have registered in some sectors have not yet translated into an increase in new unemployment insurance claims,” remarked the Thursday Nancy Vanden Houten, economist at Oxford Economics.
Registrations for these unemployment benefits even dropped in the last week of January, to their lowest level since April, according to data from the Labor Department.
But it is a matter of time before this changes, estimates Ian Shepherdson, chief economist at Pantheon Macroeconomics: “The trend is upward (of layoffs) and registrations (insurance) will continue.” /AFP