H-1B Visa Program and Related Issues

Reference

The US Commerce Secretary called the popular H-1B visa program a scam and said that American companies should hire American citizens instead of foreign workers. This statement reflects the policy of the Donald Trump administration in which there is a demand to reduce dependence on foreign workers and give priority to American workers. This policy has the greatest impact on countries like India because Indians are the biggest beneficiaries of H-1B visa.

What is H-1B Visa Program

H-1B visa is a non-immigrant visa, under which American employers can hire foreign employees in positions requiring high skills (especially in STEM fields - science, technology, engineering and mathematics).

• This program was started in the year 1990. Its maximum duration is 6 years.
• The annual cap on visas is 65,000, with an additional 20,000 slots available for holders of masters or higher degrees from US universities.
• Applicants associated with education and non-profit research institutions are exempt from this cap.

Key Features

• Giving opportunities to foreign high-skilled workers in US industries
• Giving employers an option when US workers are not available
• Highest demand in IT and technology companies
• Dominance of Indian professionals
  • More than 72% of H-1B approvals in the year 2023 were given to Indians.

Recent Issues and Criticisms

• The Trump administration and Republican leaders allege that companies misuse this visa to hire cheap foreign workers.
• Critics say that American workers are losing jobs and their wages are decreasing.
• Most Indian H-1B holders had salaries of less than $100,000 in 2023, while the average salary of US IT professionals was $104,000.
• This program is being described as 'against American workers'.

Proposed changes

• The Trump administration proposed a rule in 2021 in which visa selection was to be based on salary level - priority to those who earn higher salaries.
• Entry-level (Level 1, Level 2) employees working on low salaries would be at a loss.
• New schemes like 'Golden Card' have also emerged, under which it is proposed to give citizenship to wealthy investors.

Impact on US economy

• Positive side: H-1B visas help the US get the best talent from around the world who contribute to innovation and technological development.
• Negative side: The income and opportunities of American employees may be affected due to cheap labor.

Impact on workers

• Indian professionals get high-level opportunities in the US but salary inequality and difficulty in getting permanent residency (green card) persists.
• The proposed changes will increase challenges for foreign students and youth working at the entry level.

Challenges

• Growing nativism in US politics
• Striking a balance between US workers and foreign professionals
• Green card backlog for Indian professionals; waiting for many years
• Global competition; attracting talent from China and other countries

Way forward

• The US will have to adopt a balanced policy that benefits high-skilled foreign talent while also securing opportunities for American workers.
• It is important for countries like India to create high-skilled jobs in their economy so that talented youth do not become dependent on foreign countries.
• At the bilateral level, India-US should increase constructive dialogue on policies like H-1B and Green Card.