H-1B Visa Policy Reforms Could Benefit Indian IT Firms Despite Declining Approvals

Recent discussions around potential reforms to the H-1B visa policy could bring advantages to Indian IT services firms, even though their share of total visa sponsorships remains relatively small. A report by Macquarie Research, cited by the Economic Times, highlights the critical role H-1B visas play in addressing the U.S. technical talent shortage, despite challenges such as limited local hiring.

Concerns Over Proposed Flat Wage Policy

One of the most debated proposals is the introduction of a flat wage floor for H-1B visa holders. A flat wage implies a fixed rate of pay, irrespective of factors like job nature, location, or living costs. Macquarie expressed concerns over this approach, pointing out its impracticality due to the varying cost of living across different U.S. regions.

“For example, what might be a fair wage in a smaller town would fall short in a high-cost city like New York,” the report noted. A standardized wage could inadvertently widen economic disparities between urban and rural areas.

To mitigate these issues, Macquarie suggested converting H-1B visas into general work permits, akin to Norway’s skilled work permit model. This shift would grant visa holders greater job mobility, promote healthy competition among employers, and enhance worker protections.

Declining H-1B Visa Approvals for Indian IT Firms

An analysis of fiscal year 2024 data underscores a sharp decline in H-1B visa approvals for Indian IT firms. According to the National Foundation for American Policy (NFAP), a U.S.-based non-partisan think tank, the top seven Indian IT companies collectively received only 7,299 approvals for new H-1B employment—nearly halving from the 14,792 approvals recorded in 2015.

Amazon led in new H-1B approvals among individual companies, with 3,871 approvals in FY24. However, this marked a decline from 4,052 in FY23 and a peak of 6,396 in FY22. Cognizant followed with 2,837 approvals, while Infosys and Tata Consultancy Services (TCS) secured 2,504 and 1,452 approvals, respectively. Other major companies like IBM (1,348), Microsoft (1,264), HCL America (1,248), Google (1,058), Capgemini (1,041), and Meta Platforms (920) also reported varying levels of success.

The Way Forward

The potential reforms to H-1B visa policies and their implications remain closely watched by Indian IT firms. While challenges persist, measures to make the system more flexible and equitable could strengthen the U.S. workforce and benefit both employers and employees.

H1B Visa Issue No Longer a Concern: Piyush Goyal Declares Shift in Focus

Union Minister of Commerce and Industry, Piyush Goyal, announced that the H1B visa issue has been resolved and is no longer a topic of international concern. Speaking at Vanijya Bhavan in New Delhi, Goyal stated that this matter would no longer dominate discussions in international talks, signaling a significant shift in the focus of India’s diplomatic and economic relations. The minister emphasized that India would now concentrate on other key areas of economic and strategic partnerships instead of the long-debated H1B visa issue.

Minister Goyal’s declaration came after his recent two-day visit to the United States, where he held meetings in New York with CEOs of leading companies. During these discussions, the focus was on reforms introduced by the Modi government aimed at attracting foreign investments in various sectors, particularly pharmaceuticals and diamonds. Goyal highlighted these reforms as a major factor in drawing increased interest from global corporations, particularly from the U.S. This visit marked a continued effort by India to strengthen its economic ties with the U.S., while the H1B visa issue, which had been a prominent topic for many years, was notably absent from the agenda.

The H1B visa program has long been a critical avenue for U.S. companies to hire foreign professionals, particularly in specialized fields requiring advanced education or knowledge. The visa allows employers to hire workers for positions that require theoretical and practical expertise in specialized areas. To qualify for the H1B visa, workers typically need at least a bachelor’s degree or equivalent qualifications in the relevant field.

According to a report published by Intead and the job search platform F1 Hire, titled “Connecting Dots: How International Students Are Finding US Jobs,” certain states in the U.S. have the highest concentration of H1B visa applicants per employer sponsor. The report found that Washington, North Carolina, Texas, and Michigan lead in the number of H1B applications, with companies in these states heavily relying on the program to source foreign talent. The report also shed light on the growing diversity of foreign workers in the U.S. While Indian nationals continue to dominate the H1B visa landscape, representing 28% of the applicants, the study also highlighted a rise in applicants from countries like Brazil and the Philippines, particularly those seeking permanent labor certification (PERM).

The PERM process, overseen by the U.S. Department of Labor, is a crucial mechanism through which employers can sponsor foreign workers for permanent positions in the U.S. Notably, nine out of the top ten companies sponsoring PERM applications in 2023 were in the technology sector. This underscores the critical role of foreign talent in driving innovation and growth in the tech industry. PERM certification has become an increasingly popular route for foreign workers, as it provides a pathway to long-term employment and residency in the U.S.

However, the H1B visa program has also been the subject of scrutiny and legal challenges in recent years. A U.S. district court recently ruled against Cognizant Technology Solutions, one of the largest users of the H1B program, in a discrimination lawsuit. The court found that Cognizant had engaged in discriminatory practices against non-Indian employees, awarding punitive damages as a result. The lawsuit also accused the company of misusing the H1B visa process to favor Indian workers over other nationalities. The ruling highlights ongoing concerns about the equitable use of the visa program, particularly in industries like information technology, where a large proportion of H1B visas are granted to Indian nationals.

In response to the growing demand for skilled labor, U.S. lawmakers have introduced new legislative measures to retain international talent, particularly in the fields of science, technology, engineering, and mathematics (STEM). In July 2023, Congressman Shri Thanedar, an Indian-American representing Michigan’s 13th Congressional District, introduced the “Keep STEM Graduates in America Act.” This legislation is aimed at making it easier for international STEM students to stay in the U.S. after completing their studies. The bill seeks to streamline the visa application process for STEM graduates, encouraging them to contribute to the U.S. economy by filling critical jobs in the science and tech sectors.

The Keep STEM Graduates in America Act represents a broader effort to reform the U.S. visa system, with a particular focus on addressing the needs of highly skilled international students. STEM fields are among the most popular areas of study for foreign students in U.S. universities, and the proposed legislation seeks to make it easier for these graduates to remain in the U.S. after completing their education. By simplifying the visa process, the bill aims to boost H1B visa issuances for STEM graduates, ensuring that the U.S. retains top talent in key industries.

In addition to legislative changes, the U.S. government has also implemented new rules governing the H1B visa program. Starting from April 1, 2024, the U.S. will introduce an increased visa fee for H1B applicants. This move is part of a broader effort to reform the visa system and address concerns about the fairness and efficiency of the H1B program. The fee hike is expected to have a significant impact on companies that rely heavily on the visa to hire foreign workers, particularly in sectors like technology and healthcare.

Meanwhile, Indian investors are increasingly turning to alternative visa options to secure long-term residency in the U.S. One such option is the EB5 visa program, which has seen a surge in applications from India in recent years. The EB5 program offers a pathway to permanent residency in the U.S. for foreign investors who make significant contributions to the U.S. economy by creating at least 10 permanent jobs. According to recent data, the number of EB5 visa applications from India has skyrocketed, rising from approximately 750 applications in 2019 to over 10,000 applications in 2022.

The EB5 visa has become an attractive alternative for Indian nationals who may face challenges in securing H1B visas or student visas. By investing in the U.S. economy, applicants can gain a pathway to permanent residency, bypassing the competitive and often restrictive H1B visa process. This trend reflects a growing interest among Indian investors in securing long-term residency in the U.S. through investment-based immigration programs.

Piyush Goyal’s remarks mark a pivotal moment in India’s approach to international relations, as the H1B visa issue is now considered resolved. With the focus shifting to economic and strategic partnerships, both the U.S. and India are exploring new avenues for collaboration. As the U.S. introduces reforms to its visa system and India’s investors increasingly turn to programs like the EB5 visa, the landscape of U.S.-India relations is evolving, with both nations seeking to strengthen their economic ties in the years to come.

USCIS to Launch Organizational Accounts, Enabling Online Collaboration and Submission of H-1B Registrations

WASHINGTON—U.S. Citizenship and Immigration Services today announced the upcoming launch of a package of customer experience improvements for H-1B cap season. The measures are expected to increase efficiency and ease collaboration for organizations and their legal representatives.

USCIS will launch organizational accounts for non-cap filings and the fiscal year (FY) 2025 H-1B cap season. The introduction of organizational accounts will allow multiple individuals within an organization, such as a company or other business entity, and their legal representatives to collaborate on and prepare H-1B registrations, Form I-129, Petition for a Nonimmigrant Worker, and associated Form I-907, Request for Premium Processing Service.

“USCIS is always striving to improve and streamline our processes, and this is a big step forward,” said USCIS Director Ur M. Jaddou. “Once we launch the organizational accounts and online filing of I-129 H-1B petitions, the entire H-1B lifecycle becomes fully electronic — from registration, if applicable, to our final decision and transmission to the Department of State.”

USCIS expects to launch the organizational accounts in February 2024, with online filing of Forms I-129 and I-907 following shortly thereafter. In addition to streamlining the Form I-129 H-1B petition process, these changes should help reduce duplicate H-1B registrations and other common errors.

USCIS will also transition the paper filing location for Forms I-129 and I-907 from service centers to the USCIS lockbox as part of our efforts to increase efficiency by standardizing processes and reducing costs.

USCIS will host two national engagements on organizational accounts on Jan. 23 and 24 as well as several smaller sessions leading up to the H-1B registration period to help guide organizations and legal representatives through the process. During these sessions individuals will have the opportunity to ask questions about the organizational accounts in preparation for the FY 2025 H-1B electronic registration process and launch of online filing of Form I-129 for H-1B petitions. USCIS encourages all individuals involved in the H-1B registration and petition filing process to attend these engagements. Invitations to these engagements will be sent later this month. Visit our Contact Public Engagement page to subscribe to notifications about upcoming engagements. Additional details regarding organizational accounts will be available on the H-1B Electronic Registration Process page.

For more information about which forms are eligible for online filing, visit our Forms Available to File Online page.

For more information on USCIS and its programs, please visit uscis.gov or follow us on Twitter (@uscis), Instagram (/uscis), YouTube (/uscis), Facebook (/uscis), and LinkedIn (/uscis).

– USCIS –

Will Also Introduce Online Filing for I-129 H-1B Petitions and H-1B I-907 Premium Processing Service

WASHINGTON—U.S. Citizenship and Immigration Services today announced the upcoming launch of a package of customer experience improvements for H-1B cap season. The measures are expected to increase efficiency and ease collaboration for organizations and their legal representatives.

USCIS will launch organizational accounts for non-cap filings and the fiscal year (FY) 2025 H-1B cap season. The introduction of organizational accounts will allow multiple individuals within an organization, such as a company or other business entity, and their legal representatives to collaborate on and prepare H-1B registrations, Form I-129, Petition for a Nonimmigrant Worker, and associated Form I-907, Request for Premium Processing Service.

“USCIS is always striving to improve and streamline our processes, and this is a big step forward,” said USCIS Director Ur M. Jaddou. “Once we launch the organizational accounts and online filing of I-129 H-1B petitions, the entire H-1B lifecycle becomes fully electronic — from registration, if applicable, to our final decision and transmission to the Department of State.”

USCIS expects to launch the organizational accounts in February 2024, with online filing of Forms I-129 and I-907 following shortly thereafter. In addition to streamlining the Form I-129 H-1B petition process, these changes should help reduce duplicate H-1B registrations and other common errors.

USCIS will also transition the paper filing location for Forms I-129 and I-907 from service centers to the USCIS lockbox as part of our efforts to increase efficiency by standardizing processes and reducing costs.

USCIS will host two national engagements on organizational accounts on Jan. 23 and 24 as well as several smaller sessions leading up to the H-1B registration period to help guide organizations and legal representatives through the process. During these sessions individuals will have the opportunity to ask questions about the organizational accounts in preparation for the FY 2025 H-1B electronic registration process and launch of online filing of Form I-129 for H-1B petitions. USCIS encourages all individuals involved in the H-1B registration and petition filing process to attend these engagements. Invitations to these engagements will be sent later this month. Visit our Contact Public Engagement page to subscribe to notifications about upcoming engagements. Additional details regarding organizational accounts will be available on the H-1B Electronic Registration Process page.

For more information about which forms are eligible for online filing, visit our Forms Available to File Online page.

For more information on USCIS and its programs, please visit uscis.gov or follow us on Twitter (@uscis), Instagram (/uscis), YouTube (/uscis), Facebook (/uscis), and LinkedIn (/uscis).

– USCIS –

-+=