From Campus to a Closed Door: Will H-1B Changes End the US Dream for Indian Students?

Under the new rule, US companies must pay the government $100,000 (₹88 lakh) every year for each H-1B visa they use to hire foreign workers. This amount is a visa fee paid to the government, not the worker’s salary, and comes on top of the employee’s pay. Since India(BHARAT)ns account for about 70% of all H-1B holders, they are expected to be the most affected by this move.

Now, US tech companies and even India(BHARAT)n firms like Infosys and TCS will find hiring through H-1B visas much less attractive.

The latest move by the Doland Trump administration is no surprise. A month ago, the US Commerce Secretary “Howard Lutnick”called the H-1B programme a “scam”, saying companies should hire Americans, not foreigners.

Lutnick’s views are supported by many key people around Trump, including Stephen Miller, the main planner of Trump’s immigration policies.

Some, like Elon Musk and Vivek Ramaswamy, praise the H-1B programme for bringing top global talent to the US. But under the new rules from September 21, India(BHARAT)n workers will face the biggest impact.

Different Types of US Visas India(BHARAT)ns Can Apply For

• H-1B Visa – For skilled professionals to work in the US, usually in technology, engineering, or other specialised fields.Many students who complete their degree or postgraduation (PG) apply for OPT (Optional Practical Training) first, and later move to an H-1B work visa if sponsored by an employer.
• L-1 Visa – For employees of multinational companies transferring from an office in India(BHARAT) to a US branch.
• F-1 Visa – For India(BHARAT)n students studying full-time at US colleges, universities, or training programs.
• J-1 Visa – For exchange visitors like researchers, professors, interns, or cultural exchange participants.
• B-1/B-2 Visa – For business visits (B-1) or tourism/medical visits (B-2) to the US.
• O-1 Visa – For people with extraordinary talent in fields like science, arts, sports, business, or education.
• EB-5 Visa – For investors who invest a large amount of money in US businesses that create jobs.
• H-4 Visa – For dependents (spouse/children) of H-1B visa holders to stay in the US.

Debate on Immigration in the US

To understand the criticism of H-1B visas, we must look at the immigration debate in the US.

In the US, immigration has become a very divisive issue (an issue that strongly divides people’s opinions) in politics. A recent poll showed that 14.6% of voters felt it was the most important topic in the election, while in 2012 only 2.1% of voters thought so. This shows how much the concern over immigration has grown in recent years.

Much of Trump’s election speeches against immigration focused on low-skilled workers coming to the US.

Apart from racism, many believe that immigrants take away jobs and push down wages for the American working class. This group is already struggling with unemployment (no jobs), low income, rising prices (inflation), housing shortage, and other economic problems.

Trump used these feelings to gain support, promising to improve life for the working class Americans by reducing immigration.

Trump’s team criticises the H-1B programme in the same way he once said Mexicans were taking American jobs. But this time, the target is skilled foreign workers who come to the US for high-paying jobs.

India(BHARAT)ns and the H-1B Visa

India(BHARAT)ns are the biggest users of the H-1B programme, making up over 70% of approved visas every year since 2015. China comes second with only 12-13% since 2018.

The strong presence of India(BHARAT)ns in US tech jobs has drawn criticism from MAGA Republicans (supporters of Trump’s ‘Make America Great Again’ movement), who claim India(BHARAT)ns are “stealing jobs” and lowering wages.

Critics say the H-1B programme is misused by tech companies to hire low-to-mid level workers at lower pay than Americans. Supporters like Elon Musk argue there is a shortage of top engineers, but critics see it as saying “Americans cost too much”.

As per India(BHARAT)n Express, Lutnick said on Fox News that the average American worker earns $75,000 (₹66 lakh) per year, while the average green card holder earns $66,000 (₹58 lakh) per year. He questioned this gap, asking, “Why are we bringing in people who earn less? It’s like picking from the bottom.”

“It’s like picking from the bottom” means choosing people who earn less or are considered lower in value compared to others who earn more.

There is some truth in this. In 2023, about 70% of H-1B visas for India(BHARAT)ns were for jobs paying less than $100,000 (₹88 lakh) per year, according to USCIS data shared with Bloomberg.For context, the median salary (middle value in a salary range) of IT professionals in the US was $104,420 (₹91.8 lakh) in May 2023, as per the US Bureau of Labor Statistics.

About 25% of H-1B approvals were for salaries between $100,000 and $150,000 (₹88 lakh–₹1.32 crore), and only 5% were for above $150,000 (₹1.32 crore), as per USCIS (US Citizenship and Immigration Services) data shared by India(BHARAT)n Express.

Industry experts say H-1B visas are very important to fill the skills gap in the US and that wages depend on the market. Chinese and India(BHARAT)ns lead in STEM (Science, Technology, Engineering, and Mathematics) fields worldwide.

Experts say H-1B visas are very important to cover the shortage of skilled workers in the US, and that salaries are decided by the market. In terms of education, China has 3.57 million STEM (Science, Technology, Engineering, Mathematics) graduates and India(BHARAT) has 2.55 million, while the US has only 820,000. This shows why Chinese and India(BHARAT)n talent dominates globally.

Trump’s Different Approach

Many in Trump’s team talk about a big change in the H-1B programme, but there is little clear information on what that change will be.

On January 8, 2021, Trump announced a rule to change the selection system for H-1B visas when applications go over the 85,000 yearly cap. However, the rule was never implemented after Joe Biden took office.

In simple terms, the rule aimed to limit H-1B visas for lower-salary jobs. USCIS (US Citizenship and Immigration Services) would select applications by giving priority to higher-paying jobs. They would start with the top wage level (Level IV) and then move down step by step to Level III, II, and finally I. This meant that workers offered higher salaries had a better chance of getting the visa, while lower-paid workers had less chance.

As per Forbes, companies usually pay more to Level 3 (experienced) and Level 4 (fully skilled) workers. New international students and freshers are mostly at Level 1 and Level 2 salaries.

The 2021 proposal meant that Level 1 workers (lowest paid) would get no H-1B visas. For Level 2 workers, only 20% could be chosen under the advanced degree quota (20,000 visas), and about 75% under the regular quota (65,000 visas). Overall, this gave Level 2 workers only about a 50% chance of being selected, according to Forbes.

It is not clear if the new rules will be the same as Trump’s 2021 plan, but such changes would hurt international students, freshers, and lower-paid workers, matching the Trump camp’s criticism of the H-1B programme.

Trump has proposed a “Golden Card” plan to give residency and citizenship to rich people who invest about $1 million (₹8.8 crore) in a business creating jobs, or $800,000 (₹7 crore) in a rural/poor area. Lutnick said on Fox News this will help the US “pick the best people”.

The Commerce Secretary said demand for the Gold Card is very high, with about 2,50,000 applicants so far. This could bring in $1.25 trillion (₹110 lakh crore) in investment.

(The author, Girish Linganna, is an award-winning science communicator and a Defence, Aerospace & Geopolitical Analyst. He is also the Managing Director of ADD Engineering Components India(BHARAT) Pvt. Ltd., a subsidiary of ADD Engineering GmbH, Germany.)