Petitions for temporary U.S. skilled worker, or H-1B, visas quickly reached their limit for the third consecutive year, but expanding the program will fail to provide a solution, experts told CNBC on Thursday.
"The problem here is not so much about skilled immigration. It's about a very broken H1 temporary visa program that's exploited to the point where we're really damaging the pay of incumbent workers here," said Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities, in a CNBC "Power Lunch" Interview.
U.S. Citizenship and Immigration Services started accepting fiscal year 2016 H-1B applications at the beginning of April and reached the congressionally mandated cap of 65,000 within a week. Proponents for H1-B expansion have contended that the temporary work visas often go to workers in science, engineering or computer fields, areas the American workforce struggles to fill.
But Bernstein argued that the system encourages companies to drop American workers in favor of cheaper outsourced labor. The "exploitative" practice allows outsourcing firms to dodge wage laws, Bernstein said.
The debate has focused on the wrong policy area, said Bruce Morrison, a former Connecticut congressman and immigration lawyer. Policymakers should encourage changes that give highly skilled H1-B workers lawful permanent residency, or green cards, more quickly.
"I think exploitation is a problem. The real answer to the problem of skilled immigration is green cards for the people we want," Morrison said
The shift could "remove unfair competition" because green card workers are more strictly regulated under wage laws than H1-B laborers.
Read MoreJob openings rise to 14-year high
Bernstein, however, noted that prompting Congress to make those regulatory changes would prove difficult.