H-1B has once again become a hot topic in the US AI circle.

There are two sides to the controversy:

• Americans Ahead, represented by tech giants, believe H-1B visas are critical to the success of U.S. businesses.
• The more traditional "Americans First" camp argues that tech companies should hire American workers, not foreigners.

Although the debate is fierce, there is an indisputable fact behind it - the US technology industry is highly dependent on imported labor.

At present, the talent gaps in fields such as software development, CS, engineering, etc. are mostly filled by Indian labor. With H-1B, executives can get these foreigners to come to the United States temporarily to work for them.

According to USCIS data, tech giants such as Amazon, Google, Meta and Microsoft are among the "biggest" H-1B visa recipients.

According to NFAP statistics, the TOP 20 companies in the United States in terms of the number of initial employment H-1B applications approved in fiscal year 2024 are listed below:

From 1990 to 2023, the number of software developers in the United States quadrupled to 2.85 million, according to Census data. Over the same period, the number of computer scientists has grown more than sevenfold, to 3.5 million.

Most of that is in the U.S. workforce, but the share of foreign workers has also more than doubled, to 26 percent.

Interestingly, in addition to tech giants, IT services companies such as Cognizant Technology Solutions, Tata Consultancy Services and HCL America are also issuing a large number of visas, mainly for lower-level, lower-paying jobs.

H-1B, there is a serious imbalance between supply and demand

The H-1B program was established by Congress in 1990 as the primary route for highly skilled foreign workers to enter the United States.

Eventually, visa holders can apply for a green card, which entitles them to live in the United States indefinitely.

The shortage of skilled workers in the United States has long been acute, especially in science, technology, engineering and math (STEM fields), where the demand for expertise has soared.

Job openings in the "professional and business services" sector, which includes most technology fields, outnumbered unemployed workers by two to one in October, according to the Labour Department.

However, with the annual cap on new visas (65,000+20,000 master's and above), the demand for H-1Bs far exceeds the supply.

Companies, which have submitted hundreds of thousands of visa applications, are left to decide who gets a visa through a lottery.

A recent paper from the IZA Institute of Labor Economics found that companies that win the H-1B visa lottery typically experience larger revenue growth and employee numbers, and are more likely to stay in business.

Fortunately, employees of universities and other nonprofit organizations are generally exempt from the visa cap.

Questions abound, Musk says

"Me and the people who have helped build SpaceX, Tesla, and hundreds of other companies that have made America strong are here because of the H-1B visa. On this issue, I will fight as hard as I can. You can't imagine the scale of this fight."

So how much has Musk contributed to the introduction of H-1B visas?

According to the latest data from the National Foundation for American Policy (NFAP), Tesla has not been among the TOP 25 H-1B visa employers in the past few years, but it is now ranked 16th, jumping nine places.

While still far behind tech giants like Amazon, IBM, Microsoft, and Google, NFAP found that Tesla hired significantly more workers through its visa program in 2024

742 initial employment H-1B petitions were approved, more than double the 328 in 2023.

In addition, Tesla received 1,025 H-1B renewals last year.

Tesla laid off about 15,000 employees in April, mostly in Texas and California, with every department affected.

Those Americans who were laid off were eventually replaced by workers on H-1B visas.

Data from the U.S. Department of Labor confirms this: Tesla applied for more than 2,000 H-1B visas during the time he laid off American workers.

According to one employee, "Many of the employees who were laid off were senior engineers with higher salaries, and they were replaced by junior engineers from outside with lower salaries."

At the root of it, the most fundamental reason for Musk's support for H-1B is that it can have absolute control over employees. It has long been reported that he disliked the traditional 40-hour work week and often required Tesla employees to work 60-80 hours a week.

The H-1B visa can be another way to motivate employees to work harder and more efficiently.

Perhaps this is not just true of Tesla, but also of major tech companies. This chart reveals the real reason why tech giants hire H-1B visa workers.