President Trump continued his broad approach to immigration by focusing on the visa program for skilled foreign workers. On Friday, he signed an executive order adding a hefty $100,000 fee for new applicants seeking H-1B visas, which enable foreign professionals like software engineers to work in the United States.
The H-1B visa program was designed to help American companies find talent for roles where qualified U.S. workers are scarce. However, long-standing critics and far-right groups contend that the program is exploited by businesses to replace American employees with less expensive foreign labor. This issue has even divided Mr. Trump’s own supporters, and his stance on the program has changed over time.
Before the executive order was signed in the Oval Office on Friday, Howard Lutnick, the secretary of commerce, explained the reasoning behind the substantial fee attached to what he described as the “most abused visa.”
“The entire concept is to stop major tech companies and others from training foreign workers,” Mr. Lutnick stated. “They’ll now have to pay the government $100,000, in addition to paying the employee – making it economically unviable. If you’re going to invest in training someone, that person should be a recent graduate from one of our nation’s excellent universities.”
The newly imposed fee is likely to face legal challenges. It is set to take effect on September 21 and will apply exclusively to new H-1B applicants, as detailed in a Saturday memo from U.S. Citizenship and Immigration Services.
Here’s what you need to know about the H-1B visa program and these recent changes.
What is the H-1B visa program?
Congress established the H-1B program in 1990 to address an anticipated labor shortage. When President George Bush signed it into law, he emphasized that the initiative would “encourage the immigration of exceptionally talented people, such as scientists, engineers and educators.”
Employers use these visas, which are valid for three years and can be renewed, to hire foreign workers with specialized expertise, primarily in science and technology. This is intended for positions where American workers with comparable skills cannot be found.
To hire a foreign worker, employers must submit a petition to the government, outlining the job requirements and the qualifications of the chosen individual. While the H-1B program grants temporary work status in the United States, not permanent residency, many employers eventually sponsor H-1B workers for a green card, which can lead to U.S. citizenship.
However, confusion lingered on Saturday regarding the fee’s implementation. Mr. Lutnick initially stated that the fee should be paid annually by the American company hiring the foreign worker. Yet, White House press secretary Karoline Leavitt later clarified in a social media post that the $100,000 would be a one-time charge.
Who are the workers under the program?
Each year, Congress allocates 65,000 H-1B visas for workers holding a bachelor’s degree or its equivalent, and an additional 20,000 for those with a master’s degree or higher. Universities and research institutions are exempt from these numerical limits.
A significant number of H-1B visa recipients are software engineers, computer programmers, and other professionals in the technology sector. Major companies such as Amazon, Google, Meta, Microsoft, Apple, and I.B.M. were among the largest employers of H-1B visa holders last year, according to U.S. Citizenship and Immigration Services. However, H-1B workers are also found in various other fields, including education, healthcare, and manufacturing.
There is no per-country limit for these visas, and a substantial majority—typically between two-thirds and three-quarters—of recipients hail from India.
India’s Ministry of External Affairs publicly acknowledged the strong ties between the two nations in a recent social media post, expressing concern that these sudden changes could lead to “humanitarian consequences” for affected families. Many H-1B visa holders bring their spouses and children to the United States, where they can reside for decades on dependent visas.
Why has the H-1B visa program been criticized by some Republicans?
There are approximately 730,000 H-1B visa holders in the United States, as estimated earlier this year by an immigration advocacy group. This represents a small fraction of the more than 163 million people employed as of September.
Critics of the visa program contend that American employers frequently use H-1B visas to hire foreign workers who are willing to accept lower wages than American candidates for the same roles. Many of these critics are Republicans who align with Mr. Trump’s strict stance on immigration.
Conversely, some of Mr. Trump’s prominent supporters are leaders within the tech industry. This sector heavily relies on H-1B workers, citing a shortage of qualified American professionals to fill specialized positions.
The announcement of this new fee has caused considerable disruption and confusion across various industries, but it is expected to disproportionately impact the technology sector.
Do H-1B holders replace American workers?
To secure an H-1B visa, employers must certify that they first sought qualified domestic candidates and that hiring an H-1B worker will not negatively impact the wages and working conditions of American employees.
However, there have been instances where the program was used to bring in foreign workers for jobs previously held by Americans. In 2015, around 250 technology workers at Walt Disney World in Florida were informed they were being laid off and would have to train their replacements—H-1B visa holders recruited by an Indian outsourcing firm. Similar situations that year affected employees at Toys “R” Us and the New York Life Insurance Company.
The program mandates that employers pay H-1B workers at least the average wage for the job in the specific city or the average wage of American-born workers in similar roles. Companies are forbidden from paying H-1B workers less than others with comparable skills. Despite this, a significant portion—about 60 percent—of H-1B positions in 2019 paid “well below” the local median wage for the occupation, according to the Economic Policy Institute, which attributed this to the Labor Department’s considerable flexibility in setting H-1B wage levels.