Others are correct in stating that having these loans actually makes people more desperate for any job. It's very different in the Silcon Valley where we see a lot of high salaried tech workers. Their skills are high in demand and in the capital of tech. This isn't the case for most fresh grads.
There's also the situation of the last recession where people went back to school to wade out the downturn in the economy. I had fresh MBAs taking offers lower than what they were making pre-MBA.
This makes the situation much worse as students increase student loans, lose 1-2 years of earning, still accruing 6-9+% interest rate on undergrad loan, and then coming back into a market that's overflooded with cheaper undergrads and more master level graduates looking for jobs.
US labor is becoming so cheap that offshoring doesn't make as much sense as it used to 10 year ago.
This value proposition is very hard for new grads though. Most come out of school with little to no work experience, internships included. So it's hard for them to make this case. Not only can they usually not make the case, depending on the role, a new employee is not at optimum productivity until .5-1.5 years on the job. This is one of the main causes of employers always looking for that 1+ years of experience. The first year is most costly to the employer in training and risk the employee just taking a job somewhere else.
H1B just needs to go away and be replaced by a point system, like everywhere else in the civilized world.
"The H-1B is a non-immigrant visa in the United States under the Immigration and Nationality Act, section 101(a)(15)(H). It allows U.S. employers to temporarily employ foreign workers in specialty occupations." --- http://en.wikipedia.org/wiki/H-1B_visa
The very vast majority of jobs we're talking about here aren't specialty. This is about the decades-old mindset that you can take 40k+ debt because a any random college degree guarantees a great job/salary/career. If it's one of those prestige-branded schools, 70k+. You got a bunch of people getting majors in Liberal Arts or Economics with no particular focus on _why_ they're doing it or _exactly how_ they will apply that knowledge. They just hope to show up at Goldman Sachs with diploma in hand and get an opportunity at a lucrative career while being trained on the job. There are too many of these people and these people with little to no experience and student-loans tied to their ankles aren't in a position to bargain.
As far as showing up with an Economics or Liberal Arts degree at Goldman goes - up until the crisis hit in 2009 you could pull up with one of these at any school where they were recruiting and expect to get hired. This is what labour market figures show.
That's thing though, the effects H1B has on STEM is definitely significant. I don't know if it's bad or good yet, but I understand there's a significance in that if H1B visa holders were removed from the STEM pool today there would be a very noticeable impact. I'm talking about the people have _no idea what they want to do in life_ and just randomly get a degree in whatever and go do whatever people tell them is good; like going into accounting or something. I'm talking about the people who have no particular drive other than "My family and friends all think going to school is a good thing so I guess I better go do something". The people who become doctors are the ones that actually make it because that's a lucrative & specialized/focused field. The rest are disillusioned by how hard it has become to find a good high paying job and are held down a debt they didn't expect to have difficulty paying back.