Understanding the H-1B Visa Program and Trump’s Changes
President Trump recently intensified his immigration crackdown by focusing on the H-1B visa program for skilled foreign workers. On Friday, he signed a proclamation imposing a substantial $100,000 fee on new H-1B visa applicants, impacting professionals like software engineers seeking employment in the United States.
The H-1B visa program was established to help companies fill roles where qualified American workers are scarce. However, it has long been a point of contention, with immigration hard-liners and far-right groups arguing that it enables companies to replace American workers with foreign talent. This issue has even created divisions among Mr. Trump’s supporters, and his personal stance on the program has evolved over time.
Before signing the new proclamation in the Oval Office, Commerce Secretary Howard Lutnick justified the fee by labeling the H-1B as the “most abused visa.”
“The core principle here is that big tech companies and others will no longer simply train foreign workers,” Mr. Lutnick stated. “They’ll have to pay the government $100,000 and then still pay the employee. This makes it economically unviable. If you’re investing in training, you’ll invest in recent graduates from our nation’s excellent universities.”
The new fee is expected to face legal challenges. It is set to take effect on September 21st and will apply only to new applicants, as detailed in a memo from U.S. Citizenship and Immigration Services issued on Saturday.
Here’s a breakdown of what you need to understand.
What is the H-1B visa program?
Congress initiated the H-1B program in 1990 to address a looming labor shortage. When President George Bush signed it into law, he emphasized its purpose: to “encourage the immigration of exceptionally talented people, such as scientists, engineers and educators.”
Employers utilize these visas, which are typically valid for three years and can be extended, to recruit foreign professionals with specialized skills, particularly in science and technology, when suitable American candidates are unavailable.
The process involves employers petitioning the government on behalf of a foreign worker, outlining the job and the individual’s qualifications. While the H-1B grants temporary status in the U.S., it does not confer permanent residency. Nevertheless, many employers eventually sponsor H-1B workers for a green card, leading to a path toward U.S. citizenship.
However, confusion quickly arose regarding the new fee’s implementation. Mr. Lutnick initially indicated on Friday that the fee would be an annual payment by the hiring American company. But on Saturday, White House press secretary Karoline Leavitt clarified via social media 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 with a bachelor’s degree or equivalent, and an additional 20,000 for those with master’s degrees or higher. Educational institutions and research organizations are exempt from these numerical limits.
A significant portion of H-1B visa recipients are software engineers, computer programmers, and other professionals within the technology sector. Companies like Amazon, Google, Meta, Microsoft, Apple, and IBM were among the largest employers of H-1B visa holders last year. However, many H-1B workers are also found in other fields, including education, healthcare, and manufacturing.
There are no country-specific caps for the H-1B program, and a large majority—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 and voiced concerns that these sudden changes could lead to “humanitarian consequences” for families. Many H-1B visa holders bring their spouses and children to the United States, where they can live for decades on dependent visas.
Why has the H-1B visa program been criticized by some Republicans?
Currently, there are approximately 730,000 H-1B holders in the United States, a figure 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, particularly Republicans aligning with Mr. Trump’s hard-line immigration stance, argue that American employers often use H-1B visas to hire foreign workers who accept lower salaries than American job seekers for the same positions.
Paradoxically, some prominent supporters of Mr. Trump are leaders in the tech industry, which heavily relies on H-1B workers. These employers claim they struggle to find enough qualified American candidates to fill specialized roles.
The introduction of this new fee has already generated widespread confusion and uncertainty across various industries, but it is expected to particularly impact the technology sector of the economy.
Do H-1B holders replace American workers?
To secure an H-1B visa, employers are required to certify that they first sought qualified domestic candidates and that hiring an H-1B worker will not negatively impact the wages or working conditions of American employees.
Despite these requirements, there have been instances where the program was used to replace American workers. For example, in 2015, about 250 technology employees at Walt Disney World in Orlando, Florida, were laid off and subsequently asked to train their replacements—H-1B visa holders brought in 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 position in the specific city or the average wage of American-born workers in comparable roles. Companies are explicitly prohibited from paying H-1B workers less than other employees with similar skills and qualifications. However, a 2019 report by the Economic Policy Institute found that approximately 60 percent of H-1B positions paid “well below” the local median wage for the occupation, citing the Labor Department’s “broad discretion” in setting H-1B wage levels.