April 2001 - H1B News
H1B Lay Off - US economy downturn Impacts

Due to US economy downturn, the IT industry hit badly. The first impact is against contract workers ( Mostly H1B holders ). Many surveys reported that March-2001 was the highest laid off month for IT workers since the past 5 years. In March, the approximate lay off count is 62,000+ . The continuous slow down in the US economy made 162,000 + Job cuts so far, this year. Most of these Job cuts are from DotCom companies (72,000+). The demand for Tech people is 65% less now. Many Hi-Tech companies have started freezing the hiring; thus the Job market is having less new jobs.

Impacts on H1B Professionals

Laid off H1B Holders in USA

US consulting companies are having tough time to get projects for Hi-tech professionals because many companies temporarily freezes their new product launches and software developments. Many DOTCOMs have gone out of business and many stopped their E-Com business. Contracting workers fill especially H1B holders, most of these short-term project. This creates the situation to force the US IT consulting companies to lay off their H1B employees.

Salary and contract rates are down

More number Hi-tech workers availability and less number of Jobs made more competetion in the Hi-Tech industry, salary and contract rates are down and Job seekers are willing to work even 50% of their current salary. The reason behind this pathetic situation is H1B workers are hired at lost after all the existing options and fired first if any job cuts or budget cuts.

Tips and Legal Issues

If the H1B holder lost their job, it is necessary to file another H1B within 10 days to keep the H1B status. Another option will be instead of resigning or termination from the employment, the H1B holder take a vacation for 3-4 months and can go to their home country and come back as a valid H1B holder for the same company.

Less number of H1B filings

Many companies did not filed many H1B applications. According to INS only 72000 H1B applications are approved from Oct-2000 to Mar-2001, for the same period 115,000 H1B applications are approved. Based on this statistics the H1B visa quota will be available till end of this fiscal year.

Slow down of H1B holders entering into US

Only Very few companies are able to bring their H1B processed applicants into US (Companies those who are having long-term projects with fortune 500 companies). Many H1B holders are waiting for the calls from the H1B sponsors to enter into US

Tips and Legal Issues

Please do NOT try to come to US without your H1B sponsoring company's approval even though you have valid H1B VISA. Also do NOT try to use original VISA for some other employer. Your H1B VISA is valid for only the employer who sponsored your VISA. But your VISA can be transferable to any other employer only after you have a valid employment with your first employer. This means you need to prove your employment by showing paystubs for transferring your H1B to other employer. You are a valuable person to your employer. Your skills are in high demand in US, that is the reason you got your H1B approval from the INS under specialty occupation. But unfortunately due to US economy, your employer is delaying your arrival to US. H1B sponsoring companies are spending lots of money and time to recruit each and every candidate. They will NOT waste their efforts and money just for nothing. So please be patient till the job market is good. We are wishing you good luck for your prosperous career in US