Due to the spread of the coronavirus, US President Donald Trump signed an executive order on Monday to temporarily suspend H-1B and other work permits for highly-skilled workers. The decision was taken in the view to protect the native Americans who are facing the risk of unemployment.
In a statement, Trump said, “We have a moral duty to create an immigration system that protects the lives and jobs of our citizens.”
The new restrictions will remain effective until December 31, 2020. Senior Trump administration officials announced that the suspended work visas include H-1B, H-4 for some H-1B spouses, H-2B for low skill workers, L-1 for intra-company transfers, and some categories of J visas for cultural and education workers.
According to the reports of May, the unemployment rate among young Americans, who majorly compete with J non-immigrant visa applicants, has been significantly high — 29.9% for 16 19-year-olds, and 23.2% for the 20–24-year-old group. The new restrictions are expected to free up 5,25,000 jobs for the Americans.
Who does this NOT affect?
- Current Visa holder: No impact
- Current / Graduating Students: OPT + STEM extension in tact
- Admits / Aspirants: F1 & OPT in tact. Merit-based changes to immigration
Who does this affect?
- Outsourcing companies: No longer process H1B
- US MNCs recruiting internationally: No longer process H1B / L1
- Students with expiring OPT: No H1B stamping — extend OPT or go back to school / home
Tech Industry Criticises Policy
The decision was attacked by the US tech industry on the grounds that it will slow down the innovation and severely hurt the technology industry. The order will impact US tech firms more than Indian IT services providers, which have, over the last few years, reduced their dependency on H-1B visas and hired more people from within the country.
According to the US Citizenship and Immigration Services, the share of Indian companies among the top 10 visa recipients has dropped to 24% in 2019 from 51% in 2016. While on the other hand, the share of visas collected by major US firms such as Google, Facebook, Microsoft, and Amazon has been rising steadily. In the fiscal year 2019, 7 of the 10 recipients of H-1B visas were US industries.
Sundar Pichai, the Indian-born Chief Executive Officer (CEO) of Google and Alphabet expressed his disappointment on Twitter by saying, “Immigration has contributed immensely to America’s economic success, making it a global leader in tech, and also Google the company it is today. Disappointed by today’s proclamation — we’ll continue to stand with immigrants and work to expand opportunity for all.”
Many political observers are also linking Trump’s decision to his desire to strengthen the support of his base ahead of his re-election bid in November. Activists who are campaigning against the order estimate that around two million Indians will be severely impacted by the suspensions, including H-1B visa holders, those on L-1, and those waiting for their green cards.
Visa Lottery to End
Earlier, the visa lottery system used to pick the 85,000 successful applicants from the total number of applicants. According to the officials, Mr. Trump has also decided to replace the electronic visa lottery system by a merit-based system that will prioritize applicants with the highest salaries to get the best and brightest opportunities. The president has given the orders to permanently end the visa lottery so that the employers’ loopholes of offering jobs to lower-wage foreign workers could come to an end.
Donald Trump’s administration will also seek to put a halt on this loophole in the existing H-1B program that allows American companies to hire foreign workers which they later domestically outsource to other companies, replacing American workers.
“The President has instructed us to end that practice and will do so by regulation as soon as we possibly can” said one of the officials.
Along with this, the H-1B reforms will also include a change in the way the Department of Labour calculates prevailing wages so that foreign workers occupy the upper end of the salary scale and do not end up undercutting American workers. The department will also be allowed and encouraged to investigate H-1B abuse.