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The H1-B visa: Are the winds of change blowing in DC?

How do you solve a problem like H-1B? This is a puzzle employers, politicians and educators in the US have been trying to solve. In recent years, US Citizenship and Immigration Services have received enough visa applications to fill every slot in the lottery within just a few days. In FY18, there were 199,000 applications to fill 85,000 places.

Donald Trump's "America First" doctrine has been seen as a threat to the H1-B visa. Photo: The PIE News

Similar legislation was put forward in each of the he last two Congresses, but failed because it was seen as a threat to American jobs

The H1-B visa, which typically lasts three years, is designed to allow US employers to bring highly skilled workers into the country. It is limited to specialist occupations like architecture, law and medicine, but it’s most widely known as a means for tech companies to recruit people with skills in tech and computing.

As such, it is used by many international graduates of STEM degrees to work in the US after their studies.

Currently, H-1B visas are capped at 65,000 per year. A further 20,000 are set aside for applicants with advanced degrees from US universities. But demand for the visas far outstrips supply.

“They should never, ever be used to replace Americans”

This means international students hoping to get a foothold in the US post-study cannot count on a successful application.

“So many talented people from other countries are denied the chance to work in the US, and employers are denied their contributions, because of a cap that’s just too low,” says Eddie West, director of international programs at UC Berkeley Extension.

This is not the only flaw in the system. Critics – among them, president Trump – say the lottery favours large companies that flood the system with applications so they can hire cheap labour.

In April 2017, Trump’s ‘Buy American, Hire American’ executive order instructed the heads of the Departments of Labor, Justice, State and Homeland Security to find ways to amend the system.

“They should be given to the most-skilled and highest-paid applicants, and they should never, ever be used to replace Americans,” he said.

In February, USCIS tightened the administrative rules around sending contracted workers on H-1B visas to third-party sites. Lawyers argue this could make it more difficult for companies that outsource work to recruit via H-1B, but international students are unlikely to be affected.

But there has been speculation that the H-1B allocation could be dramatically reduced or even scrapped.

The concern, associate director of international initiatives at the National Association for College Admission Counseling, Lindsay Addington, says, is “the uncertainty of whether benefits that have historically been afforded to international students, such as working, will remain intact”.

She posits that limiting access to post-study work further would “significantly impact the United States’ ability to attract the best and brightest students from around the world.”

Another approach favoured by some legislators is raising the visa’s minimum salary threshold to prevent it being used to suppress wages. According to officials at the time of the ‘Hire American’ executive order, around 80% of H-1B workers are paid less than the median wage in their fields.

“One of the most effective ways of attracting and retaining global talent… is by providing international students with pathways to stay and work”

But a blanket rise could make it difficult for new graduates to qualify. An April 2017 report from the National Foundation for American Policy concluded that “an effort to change the system to one where only those with the highest salaries receive H-1B petitions could prevent international students from staying in the United States after graduation.”

If recent media reports are to be believed, another change could be on the horizon. The administration is reportedly considering scrapping the extensions that allow visa holders applying for a green card to stay in the country while their application is being processed, even if their visa has expired.

This could force them to return home until their application goes through. The McClatchy DC Bureau reported in December that an anonymous source briefed on the policy said it aimed to “create a sort of ‘self-deportation’ of hundreds of thousands of Indian tech workers” to open up jobs.

Amid these rumours, two Republican senators have put forward a bill that could take the H-1B route in a different direction entirely. In January Orrin Hatch of Utah and Jeff Flake of Arizona put forward the Immigration Innovation (I-Squared) Bill, which would expand rather than curtail the H-1B quota.

If it passes, international students could be among the bill’s biggest beneficiaries.

It would remove the cap on H-1B visas for those with advanced US degrees, taking them out of the lottery. The annual cap on general H-1B visas would rise from 65,000 to 85,000, with the option to add up to 110,000 more to meet the demands of the labour market. Applicants with any US STEM degree would be prioritised within the lottery, along with graduates with a PhD from any country.

The bill would also allow students on an F-1 student visa to apply for permanent residency while still studying.

The I-Squared Bill would be a “major reform in the right direction”, says Rahul Choudaha, executive vice-president at Studyportals. Anti-immigrant rhetoric has dented the country’s attractiveness as a global study destination, he argues, and a “policy pivot” is needed to rehabilitate its image.

“One of the most effective ways of attracting, integrating and retaining global talent that can support economic development and innovation is by providing international students with pathways to stay and work in the county,” Choudaha adds.

“What change could be coming next?”

The bill is backed by tech giants Microsoft and Facebook, but that may become inconsequential. Similar legislation was put forward in each of the he last two Congresses, but failed because it was seen as a threat to American jobs.

Last month, former Trump strategist Steve Bannon was railing against the visa, telling GQ the US should be “protecting the citizens of this country from the ravages of global wage competition.” Bannon may have lost his White House position, but his comments represent the views of a portion of voters that believes immigration is throttling domestic innovation.

Hatch and Flake have tried to head off such criticisms by framing it as an opportunity to boost innovation while tightening regulations. It would penalise employers seen to ‘hoard’ visas, and remove many of the exemptions tied to applicants’ salary and qualifications that allow employers to sidestep certain recruitment requirements.

The visa would also increase the cost of applying for the visa. Announcing the bill on January 25, Hatch said the extra income would generate $1bn for domestic STEM education, making it “a win for all sides”.

But the reality is that fixing the flaws in the H-1B system may not be enough to rebuild international students’ certainty in the benefits of studying in the US, which has been eroded in recent years. As Addington says: “The recent travel bans and changes to vetting policies have created a sense that America no longer welcomes or values international students. What change could be coming next?”

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