Was in a meeting with a set of people in h1b exposed industries, really does seem that the Trump admin messed up by going back on the annual $100k h1b fee, and this current law will have a marginal impact if not completely backfire. Thread on some thoughts:
It sounds like the main reaction to this is going to be a mix of offshoring, automation, visa manipulation, and nearshoring. Pretty much a universal preference for doing that rather than hiring Americans and the penalties aren’t big enough to change that.
The immediate reaction is just to move incremental hiring offshore in industries where possible. Remember, lots of this is driven by ethnic nepotism, and those networks are still in place and not really harmed by $100k fines on FUTURE visas.
Many will be shifting h1bs to the L-1 visa, which is for transferring employees from a foreign office to the US. This will be big in transportation/trucking, which as we know is a big center for Indian immigration. L-1 visas cost $2-9k per employee.
Regarding doctors, big emphasis on how hard it is to train Americans (because of government imposed caps on residency) so they have limited choice but to outsource. Trump should really get rid of that cap so more Americans can become doctors.
The $100k fine hits small companies but seems many big ones are just going to eat it and/or find workarounds like L-1. The admin needs to go a lot bigger (fines on all h1bs) and broader (go after OPT, “STEM” grad school degrees, fund domestic training of Americans).
Automation is another big one, plenty talking about how they are going to invest more in AI to avoid hiring. The other is nearshoring, moving activity to Canada or Mexico. Very industry dependent.
In short, many execs find recruiting trained Americans impossible. Obviously a lot has to do with the wages they’re willing to offer, poor training in the US, believing in fraudulent foreign credentials. But the companies will jump through many hoops to keep foreign labor.
The law’s impact will probably be similar to what we’ve seen from tariffs, causing additional friction but ultimately not changing the dominant paradigm of how business is done. Still not seeing a lift in industrial capex in the US btw.
So anyone with any influence on the admin needs to hammer home this is not enough. $100k on ALL h1bs. Aggressive oversight on ALL visas like L-1 and O-1. Raise caps on medical residency. Remove the law that gives you 3 years OPT if you go to a STEM graduate program. Invest more
Feeble measures like $100k fines on future applicants are going to accomplish very little when the rot is this deep. The admin has about 3 years left on the clock. Midterms approaching. No telling what comes after Trump. The time to act on this is now.