Coping with H-1b Shortages: Firm Performance and Mitigation Strategies

38 Pages Posted: 25 Aug 2020 Last revised: 9 Apr 2021

See all articles by Anna Maria Mayda

Anna Maria Mayda

Georgetown University - Department of Economics; IZA Institute of Labor Economics

Francesc Ortega

City University of New York, CUNY Queens College - Department of Economics ; IZA Institute of Labor Economics

Giovanni Peri

University of California, Davis - Department of Economics

Kevin Y. Shih

CUNY Queens College

Chad Sparber

Colgate University

Date Written: August 2020

Abstract

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.

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Suggested Citation

Mayda, Anna Maria and Ortega, Francesc and Peri, Giovanni and Shih, Kevin Y. and Sparber, Chad, Coping with H-1b Shortages: Firm Performance and Mitigation Strategies (August 2020). NBER Working Paper No. w27730, Available at SSRN: https://ssrn.com/abstract=3679723

Anna Maria Mayda (Contact Author)

Georgetown University - Department of Economics ( email )

Washington, DC 20057
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Francesc Ortega

City University of New York, CUNY Queens College - Department of Economics ( email )

65-30 Kissena Blvd
Flushing, NY 11367-1597
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Giovanni Peri

University of California, Davis - Department of Economics ( email )

One Shields Drive
Davis, CA 95616-8578
United States
530-752-3033 (Phone)
530-752-9382 (Fax)

Kevin Y. Shih

CUNY Queens College ( email )

Flushing, NY 11367
United States

Chad Sparber

Colgate University ( email )

13 Oak Drive
Hamilton NY 13346, NY 13346
United States

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