As Corporations Lay Off Workers, Who Stays and Who Goes?

by Joe Guzzardi
June 10, 2011

The May Bureau of Labor Statistics report that indicated a mere 54,000 jobs had been added triggered a stream of excuses not grounded in reality. Several economists who had been bullish on the economy are now hedging their bets by projecting that job growth will begin in earnest later this year and pointed to declining gas prices as one reason.

But in recent days, energy costs have gone back up. And other stubborn problems keep the economy under siege. Home prices are stagnant or still falling. The average workers wages don’t keep up with the rising cost of living. Cutbacks in spending by state and local governments also contribute to slower growth.

Among the deepest job cuts are those in local governments which slashed 28,000 from their payrolls last month, the most since November. Nearly 18,000 were in education. Cities and counties have reduced employment for 22 straight months; since September 2008, 446,000 jobs have vanished.

Professions that were once considered to offer immediate opportunities to recent college graduates like social work or health care are no longer hiring. Last year, public schools alone accounted for nearly 40 percent of the nation’s total public sector job losses.

The relentless stream of bad news is a looming disaster for the incumbent president. Yet Barack Obama is paralyzed when it comes to taking a stand against one of the most destructive federal policies regarding employment: nonimmigrant worker visas that cost Americans jobs.

An interesting case in point is developing at Cisco Systems where Chief Executive John Chambers announced his goal of slashing costs by $1 billion. Analysts estimate that 3,000 workers will be fired, many directly related to Cisco’s dumping of the Flip camera business line.

But which workers will go: American citizens or H-1B visa holders of which Cisco is a heavy user? During the period 2001-2010, Cisco sponsored 5,220 H-1B visa workers. An estimated 1,000 work at the company today.

For Cisco, the rub is that according to the terms of an H-1B visa, the company must pay the costs associated with sending home a dismissed foreign-born employee. The question is whether Cisco will give preferential consideration to H-1B visa holders over Americans simply to avoid the substantial cost of returning foreign-born workers to their native countries.

If Cisco lays off 3,000 Americans and no H-1B visa employees, it sets itself up for a discrimination law suit especially if those Americans are over 40.

As it’s structured, the H-1B visa makes American corporation the arbiter of federal immigration policy. Cisco, in this case, decides based exclusively on profit motives who comes, who stays and who goes home. Corporations, whose intentions are suspect, become immigration middlemen with complete control over their employees’ economic and personal well being. In the meantime, the companies benefit from the cheap labor those employees provide.

During sustained periods of job loss and high unemployment, immigration should be severely restricted. Instead, the United States grants work permits to over 1 million immigrants each year. No matter what side of the political aisle you sit on, admitting working immigrants during troubled economic times is indefensible.

Joe Guzzardi has written editorial columns—mostly about immigration and related social issues – since 1986. He is a Senior Writing Fellow for Californians for Population Stabilization (CAPS) and his columns are frequently syndicated in various U.S. newspapers and websites. Contact him at [email protected].