Vivek Wadhwa blogs about some interesting looking studies at TechCrunch.

Many have argued that H-1B visas depress the salaries of American workers, particularly in IT. A new study finds

foreign-born I.T. professionals on temporary work visas actually earn more than their American counterparts; and that limits on H-1B visas cause the salaries of foreign workers—rather than of Americans—to increase.

There are some fairly vitriolic comments in the discussion of the article about various abuses of the system. I'm sure the abuses are real, but I've also seen many incredibly talented immigrants here in the Bay Area whose work creates new opportunities for citizens and non-citizens alike. Google in particular is a very international work environment - not because the non-citizens are cheap, but because the company draws highly talented applicants from all over the globe and our hiring process is ridiculously selective.

I think the reason the issue is so contentious is that there are elements of truth on both sides. Yes, in the best case, H-1B visas give some companies the opportunity to draw upon talent they would otherwise not have access to, and yes, in the worst case, the visas give some companies the opportunity to push down wages.

From a policy perspective, the problem is that it's difficult to distinguish between someone who is brought in because they are cheap and someone who is brought in because they are highly skilled. One possible remedy: charge companies a fairly substantial fee (on the order of, say, 5%-10% of salary) when they hire an H-1B worker. The fee would deter the use of H-1B's as a way to hold down wages, and it would encourage the use of local workers, but it would give companies access to real talent if they wanted it badly enough. The revenues could go toward streamlining the visa granting process (which is fairly byzantine from what I understand) and for improving the training of citizens. Given the headaches the current process causes, I'm sure there would be lots of companies happy to pay a premium for more speed and less uncertainty.