Fact of the Week: Firms That Win an H-1B Visa Lottery Experience Wage Increases for Most Employees

Source: Parag Mahajan, et al. "The Impact of Immigration on Firms and Workers: Insights from the H-1B Lottery." (working paper, United States Census Bureau, Center for Economic Studies, Washington, DC, 2024).

Commentary: In a recent working paper published by the United States Census Bureau, researchers Parag Mahajan, et al., found that firms that won H-1B visa lotteries experienced positive effects across all elements of the firm. Beginning in 2007, visas for highly educated, foreign-born workers were distributed via a lottery, where only 65,000 visas are awarded. These visas allow immigrants to work at firms that also win the H-1B lottery. Using data from the first lottery conducted, the authors find that firms which win H-1B visas are more likely to survive long-term than losing firms and most employees working at winning firms experience wage increases. Young college educated workers, regardless of nativity, experience a 4 to 5 percent wage increase while young, non-college educated workers experience a three percent wage increase. The authors also found limited evidence that winning the H-1B lottery had any effect on the employment of native-born workers at the firm.