H1B Visa: Unemployment Rate Does Not Justify


According to an analysis of the BLS (Bureau of Labour Statistics Current population Survey) by the National Foundation for American Policy (NEAP), the unemployment rate for individuals in computer occupations, which is what over 60% H-1B visas are issued for, changed from 3% in January (before the COVID outbreak) to 3.5% in September.

Unemployment scales were similar for computer and mathematical occupations significantly lower than the unemployment rate of 7.8% for non-computer occupations.

Last week, US President Donald Trump’s administration introduced two new Interim Final Rules (IER) raising the wage levels of H-1B roles and introducing fresh restrictions on people to be posted at third-party locations Immigration has been a big poll plank for Trump who is seeking re-election next month.

The decision to implement these changes without opening them up to public comments, as in the case with the standard rule-making process has been widely criticised and is being seen as a political move ahead of the election.

The department of labour cited the “good cause” exception to the administrative procedure act (APA) as unemployment caused by COVID-19 Pandemic.

The rule will impact both Indian IT services firms who typically place employees at third party locations on projects as well as American tech firms by bringing in more restrictions and significantly increasing wage levels.

H-1B visa holders are concentrated in computer-related occupations but account for only a small share of workers in information technology (IT) jobs. Despite the H-1B program's small scale, the visa category is important to the US economy and to employers that use it to fill gaps in their workforce.

The presence of H-1B visa holders increases innovation, productivity and profits at H-1B employers and boosts total productivity and innovation in the United States.

Indian nationals have received over 70% of the H-1B visas issued over the last few years, even as the share of Indian tech companies in the top 10 visa recipients has been dropping steadily in favour of American tech companies such as Apple, Amazon and Google.

Industry watchers have said that restricting the H-1B visa programme would lead to an increase in outsourcing. Most tech companies hire employees at salaries higher than the minimum wage level, but the increase in slabs as per the new rules is large enough to impact the recruitment plans of companies.

Written by Kim Houkip

Edited by Anusha Vajha

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