Print Friendly, PDF & Email

Trump suspends H-1B visas till year-end

Topics Covered: Effect of policies and politics of developed and developing countries on India’s interests, Indian diaspora.

Trump suspends H-1B visas till year-end

Context:

USA has decided to extend the 60-day ban on immigrant and non-immigrant worker visas till the end of 2020.

The ban is effective immediately so the processing of all new H-1B, H-2B, J and L visa categories stands suspended.

  • H-1B, H-2B, J and L visa holders, and their spouses or children already present in the US shall not be impacted by the new worker visa ban.

What are H-1B, H-2B, L and other work visas?

In order to fill a vacuum of highly-skilled low-cost employees in IT and other related domains, the US administration issues a certain number of visas each year which allows companies from outside the US to send employees to work on client sites.

  1. H-1B: Person is Specialty Occupation: To work in a specialty occupation. Requires a higher education degree of its equivalent.
  2. L1 visas allows companies to transfer highly skilled workers to US for a period of up to seven years.
  3. H-2B visas allow food and agricultural workers to seek employment in the US.
  4. J-1 Visas: It is for students on work-study summer programmes.

Why this order was issued?

To protect American jobs during the ongoing pandemic. The entry of additional workers through the H-1B, H-2B, J, and L non-immigrant visa programmes presents a significant threat to employment opportunities for domestic workers by undercutting their jobs.

How does it impact Indian IT companies?

Indian IT companies are amongst the biggest beneficiaries of the US H-1B visa regime, and have since the 1990s cornered a lion’s share of the total number of visas issued each year.

  • Indians had applied for as many as 1.84 lakh or 67 per cent of the total H-1B work visas for the current financial year ending March 2021.

The executive order has also made sweeping changes to the H-1B work visa norms, which will no longer be decided by the currently prevalent lottery system.

  • The new norms will now favour highly-skilled workers who are paid the highest wages by their respective companies.
  • This could result in a significant impact on margins and worker wages of Indian IT companies which send thousands of low-cost employees to work on client sites in the US.

Criticisms and concerns:

This order has been criticised by the tech industry as well as politicians on both sides of the aisle as damaging to the U.S. economy.

  • Critics say, this order has the potential to do permanent damage to the USA’s reputation of attracting the best and the brightest.
  • The ban on issuing visas will harm employers, families, universities, hospitals, communities and delay America’s economic recovery.
  • Without highly skilled immigrants, the industry will slow down and the economy will worsen affecting the timeline for a treatment and cure of Covid-19 as well.

Sources: the Hindu.