U.S. President Donald Trump has signed an executive order that will add a $100,000 (£74,000) annual fee for applicants to the H-1B visa program for skilled foreign workers.
The order from Trump mentions “abuse” of the program and will restrict entry unless payment is made. Critics have argued that the H-1B visa undercuts the American workforce, while supporters—including billionaire Elon Musk—argue that it allows the U.S. to attract top talent from around the world.
In another order, Trump set up a new “gold card” to fast-track visas for certain immigrants in exchange for fees starting at £1 million.
The new Trump order is due to come into force on September 21st. It will only apply to new requests, but companies will have to pay the same amount for each applicant for six years, U.S. Commerce Secretary Howard Lutnick said.
“The company needs to decide… whether the person is valuable enough to warrant a $100,000-a-year payment to the government, or whether they should go home, and they’ll hire American,” he said, adding: “All of the big companies are on board.”
Since 2004, the number of H-1B applications has been capped at 85,000 per year. Until now, H-1B visas have come with various administrative fees totaling around $1,500.
Data from U.S. Citizenship and Immigration Services (USCIS) shows that applications for H-1B visas for the next fiscal year fell to about 359,000—a four-year low. The greatest beneficiary of the program in the previous fiscal year was Amazon, followed by tech giants Tata, Microsoft, Meta, Apple, and Google, according to government statistics.
Tahmina Watson, a founding attorney for Watson Immigration Law, said that the ruling could be a “nail in the coffin” for many of her clients, who are mostly small businesses and start-ups. “Almost everyone will be priced out. This $100,000 as an entry point will have a devastating impact,” she added, noting that many small or medium-sized companies “will tell you that they actually can’t find workers to do the job.” “When employers sponsor foreign talent, more often than not, they are doing it because they haven’t been able to fill those positions,” Ms. Watson added.
Jorge Lopez, chair of the immigration and global mobility practice group for Littler Mendelson PC, said a $100,000 fee “will put the brakes on American competitiveness in the tech sector and all industries.” Some companies may consider setting up operations outside the U.S., though doing so may be challenging in practice, he added.
The debate over H-1Bs has previously caused conflict within the Trump team and supporters, pitting those in favor of the visas against critics such as former strategist Steve Bannon. In January, Trump told reporters at the White House that he understood “both sides of the argument” on H-1Bs. The year before—while he was looking to attract support from the tech industry during his campaign—Trump vowed to make the process of attracting talent easier, going as far as to propose green cards for college graduates. “You need a pool of people to work for companies,” he told the “All-In Podcast.” “You need to be able to recruit these people and keep these people.”
Early in his first term in 2017, Trump signed an executive order that increased the investigation of H-1B applications to improve fraud detection. Rejections rose to an all-time high of 24% in the 2018 fiscal year, compared to between 5% and 8% under Barack Obama and between 2% and 4% under Joe Biden. At that time, tech companies pushed back, harshly criticizing the Trump administration’s H-1B order.
The potential for additional restrictions to the H-1B program has caused concern for countries like India, which is by far the largest source country for such visa applications.
