H-1B visas are a popular non-immigrant visa that allow American firms to employ skilled foreign workers. In April, President Trump issued an executive order titled “Buy American, Hire American,” asking the Departments of Labor, Justice, Homeland Security and State to review the H-1B visa program. This order has caused the US Citizenship and Immigration Services (USCIS) to make big changes that are reverberating through the tech industry and immigration lawyer circles.
Tech employers heavily rely on the H-1B visa for many hard to fill tech positions. A severe shortage of available skilled US tech talent is being exacerbated by an H-1B crackdown and proliferating red tape and visa rejections.
The brunt of the H-1B changes will be felt by employers in 2018
Immigration lawyers are seeing a big change in how visas are being processed in 2017 and many expect denial rates to increase to 40% in this year's H-1B cap. USCIS has started challenging H-1Bs which would have no problem being approved in the past. According to USCIS data, "requests for evidence" have soared 44 percent compared to last year. Some of the additional hurdles have become so severe prompting the New York Times to ask "Is Anyone Good Enough for an H-1B Visa?" And many companies are reconsidering their reliance on H-1B visas to help meet their needs.
More skilled, foreign tech workers choosing to stay away from US
Tightening visa challenges and anti-immigrant rhetoric are driving skilled immigrants to look outside the US. A Deloitte Touche analysis found the number of Indians in the US searching for jobs in India soared more than 10-fold between December 2016 and March 2017.
These new challenges are equally frustrating for employees and employers who are anxious about the uncertainty of the outcome and the program's future. Employees fear having to leave the country and the lives they have built in the United States. And Employers are concerned about losing access to the skilled talent they need to grow.
Which tech firms could face the biggest hit from H-1B changes?
Not all companies will be affected equally. Privco research examined which public and private tech companies rely most heavily on the H-1B program. Public tech giants Microsoft and Google are known for relying heavily on H-1B visas for engineers as shown in the infographic above. But many private tech firms such as Uber, Drop box and Mapr make liberal usage of H-1B visas as well.
Given the widespread usage of H-1B in tech, many companies both public and private face some serious decisions as they try to hire to meet their business needs. They can try to find and hire more domestic labor or move operations off shore where skilled labor is available. Pressure on tech companies will only increase in 2018 as H-1B changes ripple through the hiring ecosystem.
Bottom line: We are advising clients to develop contingency plans in case the current trends in H-1B visas continue.