I am the CEO and main programmer / Architect of a small web development firm that has been in business for 10 years next month (so hardly a startup).
If I were to hire an American as an independent contractor, i have to 1) get them to fill out a W9, 2) submit a 1099-NEC for them every year, and 3) mail them the 1099 each year.
If I were to hire an American as a W2 employee, I have to 1) get them to fill out an I9, 2) verify employability (docs, please), 3) register them with their state’s unemployment board, 4) set up payments to their state’s unemployment service, 5) set up a bank account for their withheld wages, 6) set up autopayments to the IRS for their withheld taxes, 7) fill out a 1099 for them, 8) mail it out, 9) sign them up in the payroll processor, 10) buy them health insurance via the Marketplace, 11) set them up in the 401k account, 12) register with their state income tax body, 13) autodeposit withheld taxes to their state income tax body, 14) make sure they go through mandatory trainings (such as sexual harrassment, etc.), 15) BUY THEM A LAPTOP Probably more stuff
When I hire a foreign contractor: 1) I pay a lot less money. 2) I have them fill out the W9-BEN that says they aren’t a US citizen and don’t live in America, 3) set up for their autodeposits.
That’s it! And they usually cost 1/5th to 1/10th what Americans cost
Clearly, from a pure burden perspective, America makes it far more easier to hire foreign nationals than Americans.