In his electoral campaign, President Donald Trump pledged to put "America First" and now he's gotten down to business by signing an Executive Order that directs federal agencies to review employment immigration laws.
Although it doesn't stipulate any immediate modifications of the existing rules, the order specifically targets one of the visa programs, namely the H-1B temporary visas.
Designed as an initiative to promote the hiring of American workers, the EO could bring important changes for technology companies and the outsourcing firms they rely on — the primary employers of skilled overseas workers for jobs in the United States.
"With this action, we are sending a powerful signal to the world: We're going to defend our workers, protect our jobs and finally put America first," President Trump said during a visit at the Snap-On Inc headquarters in Kenosha, Wisconsin, before signing the EO.
What Is The H-1B Program And How Will Temporary Work Visas Be Impacted?
According to the New York Times, the program grants every year 65,000 work visas to foreign workers who typically apply for low-pay jobs, mostly in the tech industry.
An additional 20,000 visas are assigned to overseas applicants with advanced degrees, while universities, teaching hospitals and other nonprofit organizations benefit from an unlimited number of extra visas.
The visas are intended to go to foreign nationals in occupations that generally require specialized knowledge, such as science, engineering or computer programming.
Federal law states that companies employing a large number of H-1B workers must provide records showing they firstly attempted to hire Americans for the same jobs.
Data from the Labor Department indicates the recipients of approximately 40 percent of the visas are entry-level employees, while another 40 percent go to applicants with limited experience and skills.
The H-1B temporary visas are allocated through a random lottery system and have a duration period of three years, after which the beneficiaries can renew them for an additional three years.
The new EO signed by President Trump aims to modify or replace the current lottery for H-1B visas with a merit-based allocation system that would ensure only highly skilled immigrant workers receive the temporary visas. To this effect, the order directs four federal agencies to come up with reforms for the H-1B program.
In his statement, Trump pointed out these visas "should be given to the most skilled and highest paid applicants and they should never, ever be used to replace Americans."
Which Companies Typically Hire H-1B Employees
Foreign workers who manage to acquire an H-1B visa are usually contracted by India-based outsourcing companies, such as Wipro Technologies, Infosys, Tech Mahindra, and Tata Consultancy Services. These companies connect U.S. technology firms with thousands of foreign engineers and programmers.
Other companies employing H-1B workers are outsourcing firms based in the United States, particularly IBM and Cognizant Tech Solutions Corp, as well as leading American technology companies, including Google, Microsoft and Apple.
Facebook and Qualcomm are also extensively dependent on the H-1B program — at least 15 percent of their American workforce comes from visa holders. Immigrant tech workers are likewise employed by thousands of Silicon Valley startup companies.
"We hope the goal of President Trump's Executive Order on the H-1B program is 'mend it, don't end it,'" said Robert Atkinson, president of the Information Technology and Innovation Foundation, a technology industry group.
As Atkinson explains, a merit-based H-1B system could attract more people with advanced science and technology skills. However, he points out, the requirement to advertise job openings for longer periods in order to ascertain the unavailability of U.S. workers may affect the system's efficiency.
Federal records show H-1B visas are most often sought by workers from India, aged between 25 and 34, who fill technically oriented jobs. According to The White House, about 80 percent of H-1B workers are paid below the median wage in their industries.
"The very low-level, junior positions that employers may be using H-1Bs for may be at risk," said Elizabeth Espίn Stern, leader of the employment immigration practice at Mayer Brown in Washington.
"But it also means employers can be at risk if they're not reviewing how competitive the salaries are for their foreign workers," she added.