With Unemployment Rising, Is It Time to Stop Hiring Foreign Workers?

This is the time when anger about the sorry state of affairs for many unemployed or soon to be laid off American workers causes sever misplaced anger towards foreign workers and immigrants. It is worth noting that it is not the fault of these foreign workers who just like many of us want to make a decent living and have no intent whatsoever to cause suffering to anyone. The economic conditions under which companies operate dictate on the type of labor hired. Naturally, companies will seek the cheapest labor possible, and if American labor has become too expensive these companies will outsource. It is not fair for government to interfere in the market and dictate what type of labor needs to be hired because it does not mitigate unemployment risk at all. Seeing how prices and wages are related and a function of supply-demand, introducing any restrictions in the labor market will cause further depression of wages and lower labor demand.

The Senate passed a bill placing restrictions on banks which have received TARP money and who hire foreign workers:

Senate approves restriction on foreign hires

The Senate voted Friday to restrict the hiring of foreign workers by banks that are receiving government bailout funds while undergoing vast layoffs.

The legislation by Sens. Bernie Sanders, a Vermont independent, and Charles Grassley, R-Iowa, would require the banks to seek American workers before turning to foreign nationals when they're hiring. It aims to prevent replacement of Americans by foreigners working under the H-1B visa program, which allows employers to bring in workers for high-skilled and advanced-degree jobs.

The measure has a two-year life and if signed into law would apply to the more than 300 banks that are receiving money from the taxpayer-funded Troubled Asset Relief Program.

The Senate added the restriction as part of the massive economic stimulus package lawmakers are crafting as part of President Barack Obama's plan to reinvigorate the economy.

If it becomes law, banks seeking visas to bring in foreign workers would be barred from displacing or replacing American employees for three months before and three months after petitioning the government for the visas.

...

Partial data from the U.S. Bureau of Citizenship and Immigration Services suggests that the banks ultimately got visas for only about one-quarter of the number of workers they initially sought permission to employ. For example, the banks and their subsidiaries filed more than 5,000 visa applications with Labor Department officials during the 2006 budget year. After that step, they ended up with about 1,200 new workers approved by the Citizenship and Immigration agency.

From: AP

I would imagine that left alone banks would seek the cheapest labor possible. Given the current state of the economy and job market with unemployment surpassing 7% and climbing, it is only natural that wages will go down as long as prices remain depressed.