Donald Trump signed a proclamation on Friday that would impose an annual $100,000 fee on H-1B visa applications, dealing a potentially major blow to the US tech industry, which relies heavily on workers from India and China.
The US commerce secretary, Howard Lutnick, said at a Friday press briefing that “all the big companies” had been briefed on the new fee.
“A hundred-thousand dollars a year for H-1B visas, and all of the big companies are on board. We’ve spoken to them,” Lutnick said at an Oval Office event with the US president.
“If you’re going to train somebody, you’re going to train one of the recent graduates from one of the great universities across our land. Train Americans. Stop bringing in people to take our jobs,” he said.
It’s all long been more than a bit of a scam. Not sure this is quite the solution but blowing up the current position isn’t wholly bad shall we say.
Matt Goodwin is good on this…
Many of the Parish here work/ed in IT and know full well the quality of Indian ‘specialists’ . Not a few of the ones I encountered could barely speak English let alone get their programs to compile.
This was, as ever, some neat idea cooked up by the accountants that really run the companies. Hitting them in the Balance Sheet is all they understand.
The big question is – will it apply to all the ones currently in the US as well? Because the H1B visas last up to 6 years, so potentially beyond the Trump administration.
Does the Visa last at the pleasure of fedgov, or is that a six year guarantee? The latter would surprise me.
When I had an American visa one of our foremen treated a labourer so badly that I offered to sort him out. But wiser heads prevailed on the grounds that I’d either go to jail or be thrown out of the country or, more likely, one then the other.
The difference probably is that the US government has certain get out clauses by which it can revoke a visa, you being convicted of assault most likely being one, but it can’t just unilaterally revoke a visa if you’ve not violated its terms. There is probably a ‘State security’ clause too, that would be used if someone was suspected of terrorism (say), but it’s probably a stretch to think that all H1Bs could be revoked on security grounds. I think the courts might intervene on that one, and probably rightly so.
Well, they were hugely oversubscribed at $1000 each, so raising the price seems like a reasonable approach.
The visa requirements are “theoretical and practical application of a body of highly specialized knowledge,”, so how on earth are these illliterate incompentant cheap morons getting in?
In the same manner that the law as passed by Parliament says that you can only get an abortion in the UK if 2 independent doctors decide that having the baby would result in more risk to your health (physical or mental) than having an abortion. Which translates to today as:
‘Doc I want an abortion!’
‘Ok no problem, come back later and collect your paperwork’.
“and all of the big companies are on board”
Are they? Why would they be in favour of higher costs of people?
Just spitballing here, but maybe, all these big companies have offshored a load of the work operate their teams globally, on the cloud and are happy with Panjeet working from Bangalore on Indian wages rather than bringing him to the USA?
A mate of mine in Swindon works for Meta. HP used to have half their web team in India. Microsoft Azure support seems to be done from Nigeria.
“If you’re going to train somebody, you’re going to train one of the recent graduates from one of the great universities across our land. Train Americans. Stop bringing in people to take our jobs,” he said.”
What planet are you living on? This isn’t the 80s where you went on a graduate training programme and they spent months training you in a skill and a job for life. No-one spends much on training anyone in software. We hire people who know what they’re doing, like computer science graduates. People who have written code, know databases and what they get trained in is the company and domain specifics.
From government’s point of view, if they’re in Bangalore, then they’re not in California along with all their relatives on welfare.
If they’re in California, then when they get fired, it’s relatively easy to disappear. The state officials will even help.
Yes offshoring is a problem, but it’s a different problem. Fix immigration first as it’s larger.
Oh, and offshoring has pretty much shown its weaknesses by now (time zones, no English, no understanding, etc.). Which is one reason why there’s so many visas.
I get the government’s point of view. I’m asking why companies are “on board” with it?
Cynical minds might wonder whether the ‘£250bn’ tech investment into the UK from the US is in fact a plan to build massive dark sites and then employ loads of Indians (the UK has a deal to import millions of ’em) in cheap offices in the sticks to be paid at UK rates, with a few US managers on a lucrative assignment. As far as the UK is concerned a few builders will make money. Equipment won’t be sourced here and nor will labour.
Don’t forget that under the terms of Starmer’s ace trade deal with India, employees of Indian companies seconded to work in the UK for up to 3 years will pay no NI. And that includes employers NI as well, so there’s a 23% cost saving right there.
So yes, the Mag 7 could set up shop in the UK (where wages are far lower than the US anyway), contract with some middleman Indian company (Pajeets’R’Us) for ‘IT services’ and then ship over loads of Indians and end up paying them far less than UK citizens who do exactly the same work. Yes there’s a minimum wage requirement of about £48k to qualify for this, but I bet there’s some way the sharp suits can finagle their way around that, by nominally paying the employees £48k, but then charging them for something back in India, and recycling the savings back to the client, ie Amazon et al.
I’ve always thought that the H1B visa should be an auction rather than a lottery. Start the price at $500,000 per year salary. Drop the price at $1000 per minute with the reserve being the current minimum wage. Have the IRS ensure that the wage is actually paid to the visa recipient.
How ’bout just NO H-1B visas. They don’t have to be present to contribute.
Though a hundred k per year might approach that.
This is the same as a tariff – it’s a tariff on labour rather than on goods, but it’s economically the same thing.
If it has any effect (bearing in mind the ephemeral nature of Trump’s policies) it certainly won’t be that of creating or maintaining American jobs – it will acccelerate the rise in technology outside America because people who once would have moved to the USA to work in a job will instead do it outside the USA. With the USA already afraid of China catching up and overtaking its lead in technology, this is one of the stupidest policies that could be introduced. Eventually Americans will be emigrating to work on leading technology.