Investigation: 2020 to 2023 data shows how thousands of middlemen game the H-1B program and companies farm out IT workers to exploit the US visa lottery system
Each year in April, the US government conducts a lottery that shapes the lives of hundreds of thousands of people — and America's future as an economic power. X: @deedydas , @yask123 , @ericfan_journo , @ericfan_journo , @ericfan_journo , and @ericfan_journo . LinkedIn: Viet Bui Forums: Hacker News and r/Economics X: Deedy / @deedydas : The H-1B is rigged by IT staffing and outsourcing firms. These firms pay lower salaries and use multiple H-1B apps to crowd out deserving candidates in the lottery, claiming 50% of all H-1Bs. Kandi Srinivasa Reddy applied 15 times for one candidate! [image] Yask Srivastava / @yask123 : US needs point based immigration system. https://www.bloomberg.com/... [image] @ericfan_journo : We then identified 3000+ IT staffing firms, often called Body Shops or Desi Consultancies. Many cheated on a massive scale to submit multiple entries for the same candidates. The government called it fraud. Yet there's little consequence. Many kept winning new visas this year. [image] @ericfan_journo : Congress created H-1B in 1990 to help American businesses get the world's top talent. Instead, outsourcing and staffing firms flooded the system. They bring in lower-level workers and pay lower wages. They game the lottery to gain unfair advantages. [image] @ericfan_journo : An outsourcing firm, however, can draw from its vast workforce in India and put in 3X number of tickets. It doesn't care who gets selected as long as somebody gets selected. @USCIS rules require a “legitimate job offer” for each lottery entry, but don't require any proof. [image] @ericfan_journo : Every year, a lottery determines who gets an H-1B visa to work in the US. The game, it turns out, is rigged. Outsourcing and staffing firms are exploiting loopholes, crowding out US employers and immigrants who play it fair. We have exclusive data to show it for the 1st time 🧵 [image] LinkedIn: Viet Bui : I rarely praise modern journalism, but this is such a well-written and informative article from Bloomberg . … Forums: Hacker News : How Middlemen Are Gaming the H-1B Program r/Economics : How Thousands of Companies Are Gaming the H-1B Visa Program
Context & Ripple Effects
The investigation supplies data-backed detail for a long-running concern that outsourcing intermediaries can use H-1B hiring to lower labor costs, echoing earlier coverage of the program being used to replace U.S. tech staff with lower-paid foreign workers.
It also helps explain why later policy coverage centers on changing selection incentives: proposals would give greater weight to higher-paying employers rather than leave allocation to an undifferentiated lottery.
First-order effects
- Candidates represented through firms making repeat entries gain disproportionately better lottery odds, while applicants with a single legitimate entry face a less even selection process.
- IT staffing and outsourcing firms identified in the investigation face heightened scrutiny over multiple registrations, even as the report says many continued receiving visas.
Second-order effects
- Client employers can source IT labor through intermediaries whose lottery tactics and lower wage structures undercut direct employers competing for the same visa pool.
- A wage-weighted selection approach, later proposed in the H-1B reform proposal, would shift the advantage away from volume-based filings and toward employers able to support higher-paid roles.
Third-order effects
- If enforcement and selection rules increasingly target duplicate-entry schemes, H-1B access could become less dependent on intermediary scale and more tied to the wage and role offered.
- The dispute recasts H-1B policy from a talent-supply question into a labor-market design issue: whether visa allocation rewards scarce skills or labor-arbitrage models.
The trend: H-1B policy is moving toward limiting intermediary-driven lottery advantages by linking visa allocation more closely to job quality and employer pay.