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Cape Cod, other holiday spots hit hard as temporary migrant worker program shrinks

Jonathan Wiggs/Globe Staff/File

Businesses on the Cape are struggling to find workers after Congress allowed a temporary migrant worker program to shrink.

By Jeanna Smialek Bloomberg News 

WASHINGTON — Waiters in Cape Cod, stone masons in Colorado, and thoroughbred caretakers in Kentucky are in shorter supply after Congress allowed a temporary migrant worker program to shrink.

Lawmakers temporarily lifted the number of seasonal visas for unskilled, non-farm workers for fiscal year 2016: Workers who had used the program in recent years were allowed to re-enter without counting toward the 66,000-person cap. Congress didn’t renew the exemption when it had the chance in December.

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That decision came as nationalistic sentiment tightened its grip on American politics. President Trump had just won the 2016 election, riding on promises to put America first. While H-2B is less prominent than the H-1B program for high-skilled workers, it too is criticized for undercutting US jobs and wages. Now, the short supply of foreign workers is adding to employers’ difficulty as they try to fill openings in an increasingly tight labor market.

“There are so few US citizens available to do many of these jobs,” said Alex Waldrop, chief executive officer at the National Thoroughbred Racing Association. His industry has been lobbying to get the exemption back, because horse farms have trouble hiring Americans for some caretaking positions and have relied on the visas.

Some lawmakers are pushing to reinstate the returning-worker provision in their current spending deal, which could come by the end of the week. It’s unclear whether that will work, stoking labor uncertainty for employers in vacation destinations across America.

The H-2B program accepts applications in two rounds, each capped at 33,000. The summer limit was hit on March 13 this year, about a month earlier than last year. It has been exhausted each of the last three years.

The Cape is facing a major labor shortage — one the H-2B shortfall is exacerbating.

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The cost of living there is high, so lower-wage workers often can’t afford to stay year-round. It is difficult to convince American workers who can get full-time jobs in a strong economy to relocate temporarily. Foreign workers have been more willing to take short-term gigs, and companies have brought in about 2,500 H-2B employees over the last several years, according to local immigration lawyer Matthew Lee.

This year, Lee expects employers to get 1,000 fewer H-2B workers than they’re asking for as the strong economy drives up competition for visas and the cap limits availability.

“We’re not talking about Cape Cod being closed this summer, but these are critical employees,” he said, noting that many H-2B employees return year after year.

Employers on the Cape and Islands have tried to find more reliable alternatives than the visa: The local Chamber of Commerce has attempted to recruit US citizens from the Virgin Islands and Puerto Rico, for instance. They only got about a dozen workers out of that effort, said Wendy Northcross, head of the Cape Cod Chamber.

“They’re not looking for cheap labor, they’re not looking to undercut wages — they’re looking to stay alive, they’re trying to grow their business,” she said. The strong economy is a “double whammy” because it makes workers hard to come by and vacationers plentiful.

Still, the H-2B program is controversial. As is the case with the H-1B program, opponents say it can be used as a way for employers to get around hiring more-expensive domestic workers.

Protections do exist to deter misuse. Employers are supposed to show that it’s impossible to find a US worker for the H-2B job, that foreign hires won’t drive down wages, and that the job is temporary. Practically, that means businesses have to advertise the job posting in local media and match or beat the government-defined prevailing wage for the job.

Still, there are documented instances in which the program has been abused, including an episode where Indian workers said their employer used it to traffic them to Gulf Coast shipyards under the false promise of citizenship. The employees were awarded damages. More recently, the Department of Labor’s Office of Inspector General has raised concerns that employers don’t make sufficient efforts to recruit American workers before filing for foreign help.

“Taking away those entry level jobs is, in my view, an even bigger problem than taking away the high-skill jobs, like the H-1B does,” said Rosemary Jenks, director of government relations at NumbersUSA, which has advocated against the exemption.

The H-2B visa wasn’t a top priority for labor groups when the returning worker exemption was included in the 2016 fiscal year legislation, though then-Senator Jeff Sessions and Democratic Senator Bernie Sanders opposed it.

After its inclusion, it generated more controversy. House Speaker Paul Ryan was asked about the exemption in a late 2015 interview and defended it as a “small, discrete provision.” Sessions, now attorney general, remained one of the program’s loudest critics, saying in a June 2016 hearing that special interests have “an insatiable demand it seems for foreign labor which is easy to exploit.”

Without much fanfare, the language failed to reappear in the 2016 continuing resolution.

Companies that use the program hope Congress will re-insert the exemption in a new omnibus spending measure to fund the government through the end of the fiscal year. Current funding runs out on Friday. An exemption could be retroactive, allowing small businesses to bring in workers for summer 2017.

There’s also legislation in the House and Senate that would make the returning-worker provision permanent. Representative Thom Tillis, Republican of North Carolina, has introduced legislation that would write it into law, which was referred to the Senate Judiciary Committee on March 30. Similar legislation exists in the House.

Dave Little, chief business development officer at the Gallegos Corporation in Colorado, is among those wishing for H-2B relief. Little’s construction company — which has worked at the exclusive Yellowstone Club near Big Sky, Mont., and at projects in Aspen — will be stretched thin for expertise in stone laying and masonry.

“Guys just don’t want to lay brick, or lay stones,” he said of native workers. Of the 80 visas the company applied for, they’ve gotten 20 in Denver, while their applications for workers in Vail, Aspen, and Big Sky were rejected. That means lots of overtime for the existing workforce, and that the firm will have to “share” workers with other contractors.

“We are in full-on scramble mode,” Little said.