As per a Federal Register notice released on Tuesday, the Trump administration has decided to replace the lottery system of the H-1B visa process with a wage-tier system to favour more skilled and better-paid labourers. The move comes after White House introduced a $100,000 hike in visa fees.
As per the new rules, more weight will be given to employers paying higher wages if annual visa requests are more than 85,000. The notice further added that the move aimed to stop unfair disadvantage to American citizens vis-à-vis foreigners. Donald Trump has been known to pursue anti-immigrant policies. In his recent term, he took strict measures to curb immigration and even took steps to stop granting citizenship to the children of immigrants using illegal methods.
His most recent target has been the H-1B visa, which is used by companies to hire a higher-skilled foreign workforce. Panic struck when the latest fee hike was declared, but it was later clarified that the new fees would only be imposed on new applications. The new system proposes to change the previously followed lottery system if the demand is more than the supply, by creating wage tiers where higher wage jobs will be prioritised.
The visa registration process takes a long time, and the administration clarified that the new rules can be expected to be in place by March 2026. The wages are expected to be $502 million by the next fiscal year, 2026. Further estimates, as per the Department of Homeland Security estimates are $1 billion in 2027, $1.5 billion in 2028, and $2 billion between 2029-2035. The news has created a situation of urgency among businesses, especially smaller ones, as they are expected to face the highest burden of increased labour costs.
