H-1B visa applicants pose ‘a big obstacle to employment opportunities’ for millions of young workers, says Trump; IT firms argue that the change would hurt the economy.
H-1B visa applicants hoping to enter the U.S. for work will have to be patient, as President Donald Trump has at least extended the earlier 60-day ban on skilled foreign workers entering the country by the end of the year.
The move is designed to protect millions of U.S. workers who have lost their jobs as a result of the economic slowdown caused by the response to the COVID-19 pandemic, according to the White House.
IT companies relied heavily on the H-1B program to fulfill their roles in technology. Many social media posts yesterday condemning the decree, like Twitter, quoting Jessica Herrera-Flanigan, vice-president of public policy and philanthropy for the Americas, stating, “This declaration threatens America’s biggest economic asset: its diversity.”
Between February and April of this year, “more than 20 million U.S. employees have lost their employment in key sectors where companies are already demanding H-1B and L staff to fill vacancies,” Trump wrote in Monday ‘s declaration that applicants for those visas will be prohibited from accessing the U.S. before Dec. 31. The move extends the 60-day ban that he signed in April.
H-1B visas are given to foreign employees when companies may show enough trained staff can not be identified domestically. While the number of new H-1B visas is currently limited to 65,000 each year, plus an additional 20,000 for applicants with master’s degrees or higher from the U.S. Educational institutions, 188,123 were issued in 2019, including renovations, according to the U.S. Figures of the State Department. L-1 visas, meanwhile, may be granted to employees transferred from a foreign subsidiary to a U.S. company; 76,988 were issued in 2019, with little change from the previous year.
No effect applicants on in the U.S.
In the near term, Trump’s new order would have no impact on the availability of labour, since visa applicants are untouched even in the US.
“One thing that is sometimes overlooked in these debates is the difference between a visa and a status. A visa is simply an entrance permit printed on a passport — also called a visa stamp. A visa designation is a lawful privilege to live and operate in the United States,” says Rebecca Bernhard, a lawyer in the immigration and jobs services at Dorsey & Whitney, an international law firm.
“This executive order prohibits the State Department from granting any new job visas to join the United States, but it will not revoke or change the status of international employees currently in the United States,” Bernhard said.
That ensures winners of this year’s H-1B lottery in the U.S. are still in the clear: their H-1B status will already take effect on Oct. 1 because they won’t have to fly overseas to receive a visa, Bernhard states.
Technology representatives accept immigration
Enterprises may employ foreign workers on H-1B visas only if they can demonstrate to the U.S. Department of Labor by filing a Labor Condition Application (LCA) that can not be found by the U.S. Workers with the skills they need. DOL certified around 468,000 LCAs for new, existing or transferred H-1B visas in 2019. In that year, 188,123 three-year visas were issued or renewed, while the number of new H1-B visas remained limited to 65,000.
About 117,000 IT cuts occurred in the aftermath of the COVID-19 pandemic in the U.S., according to figures released earlier this month.
While firms are likely to hire so many, and more, before the end of the year, according to U.S. employment consultancy Janco, the net number of new IT jobs this year will be hit. Janco is now expecting 35,000 new U.S. IT jobs will be created this year, compared to the 94,500 that were forecast before the pandemic hit. Last year, 90,200 new IT jobs were created in the U.S., he says.
While not all H-1B visas would be given to IT staff, there is a risk that H-1B applicants currently in the U.S. will impact heavily on the stagnant IT job market.
That’s not a reasonable excuse to shut the gates to them, however, according to Herrera-Flanigan on Facebook.
“People from all over the world come here to join our workforce, pay taxes and contribute to our global competitiveness on the world stage. The unilateral and unnecessary stifling of America’s attractiveness to global, highly skilled talent is short-sighted and deeply damaging to the economic strength of the United States, “she wrote on the company’s platform.
Sundar Pichai, CEO of Google’s parent company Alphabet, also took Twitter to express his disappointment at the new visa policy, adding: “We will continue to stand with immigrants and work to expand opportunities for all.”
Microsoft’s President Brad Smith called out the company’s crucial position for refugees, saying: “Now is not the time to cut off our nation from the talent of the world or generate confusion and fear.”
According to MyVisaJobs.com, Microsoft had 3,403 LCAs certified last year for H-1B visas, about 88 percent of them for IT roles.
In the meantime, Google had 7,317 H-1B LCAs certified in 2019. Only three employers were ahead: Cognizant Technology Solutions, Infosys and Tata Consultancy Services (TCS) outsourcing firms.
1. Offshoring:
The COVID-19 pandemic did not just cause economic slowdown, though: it also showed us that many more jobs than we suspected could be done from home — or, indeed, from anywhere.
With so many U.S. companies already turning to outsource firms to meet their IT needs, there’s a chance that Trump’s strategy might backfire by encouraging U.S. firms to take those jobs offshore instead of rehiring them in the U.S.
Although the latest policy impacts overseas citizens requesting entrance to the U.S., it would have little impact on businesses hiring IT personnel in other nations.
“This policy is likely to have an adverse effect on the U.S. economy because companies will employ people in other countries and there is no need for any U.S. visa to employ a worker outside the U.S.,” says Bernhard, adding that U.S. companies must comply with the employment laws of other countries in that case.
About two-thirds of H-1B applicants are from India and two of the top three visa applicants (Infosys and TCS) are also from India. The sixth, Cognizant, is headquartered in the U.S., but more than half of its 290,000 workers are located in India.
“Many companies are abandoning the U.S. immigration process and expanding their outsourced workforce,” Bernhard concludes.
