The strong visa rates of the Trump administration for H-1B workers have caused high-level conversations within companies in Silicon Valley and beyond the possibility of moving more jobs abroad, precisely the result that policy should stop.
The president of the United States, Donald Trump, announced on Friday the change in the Visa program that has long been a recruitment way for technology companies and encouraged international students to carry out postgraduate courses in the United States.
Although the $ 100,000 tax applies only to the new applicants, not to the current headlines as announced for the first time, the confusion around their deployment and the steep cost is already taking companies to stop the recruitment plans, budget and workforce, according to reuters interviews of the founders, risk capitalists and immigration lawyers who work with technology companies.
“I have had several conversations with corporate clients … where they have said that this new rate is simply unfeasible in the US., And it is time for us to start looking for other countries where we can have highly qualified talent,” said Chris Thomas, immigration lawyer at the law firm based in Colorado Holland & Hart. “And these are large companies, some of them family names, Fortune 100 companies, which they are saying, we simply cannot continue.”
According to Pew Research, around 141,000 new applications for H-1B in 2024 were approved. Although Congress limits the new visas to 65,000 a year, total approvals are higher because the requests of universities and some other categories are excluded from the limit. Computer -related works represented most of the new approvals, according to PEW data.
Companies will cut the H-1B workers
The Trump administration and critics of the H-1B program have said that it has been used to suppress salaries and stop it opens more jobs for US technological workers. The H-1B Visa program has also made it more challenging for university graduates trying to find work, Trump’s announcement said Friday.
The visa previously cost employers only a few thousand dollars. But the new $ 100,000 rate would turn the equation, causing hiring talent in countries like India, where wages are lower and Big Tech now builds innovation centers instead of backup offices, more attractive, experts and executives told Reuters.
“We probably have to reduce the number of H-1b visas workers that we can hire,” said Sam Liang, co-founder and CEO of the start-up start-up of the transcription of popular artificial intelligence. “Some companies may have to outsource part of their workforce. Hire perhaps in India or other countries just to walk through this H-1B problem.”
Bad for startups
While conservatives have long applauded Trump’s wide repression of immigration, the H-1B movement has also resorted to the support of some liberal rooms.
The Netflix co-founder and a well-known Democratic Donor Reed Hastings, who said he has followed the H-1B policy for three decades, argued in X that the new rates would eliminate the need for a lottery and, instead, they would reserve visas for “very high value work” with greater certainty.
But Deedy Das, a partner of the Risk Capital firm Menlo Ventures that has invested in new companies such as the firm AI Anthrope, said that “general decisions such as this are rarely good for immigration” and would disproportionately affect new companies.
Unlike large technology companies whose compensation packages are a combination of cash and shares, the payment packages of new companies generally incline to capital, since they need cash to build the business.
“For larger companies, the cost is not material. For smaller companies, those with less than 25 employees are much more significant,” said Das. “Big Tech CEO expected this and they will pay. For them, less small competitors is even an advantage. It is the new smallest companies that suffer the most.”
Innovation at risk
Politics could also mean less talented immigrants who often launch new companies, analysts said.
According to a 2022 report by the National Foundation for American Policy, a non -partisan report based in Virginia.
Several lawyers said that the new companies that represent are setting hopes in the demands that argue that the administration exceeded by imposing a rate beyond what the congress imagined, the bets of bets would dilute the rule before the costs paralyze the hiring.
If not, “we will see a setback from the smartest people in the world,” said Bilal Zuberi, founder of Silicon Valley’s risk capital firm, Red Glass Ventures, who began his career in the United States with an H-1B visa.
Additional Krystal Hu reports
—Ditya Soni and Echo Wang, Reuters
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