Before the ink is dry on his chaotic plan to charge employers a fat fee for hiring foreigners, US President Donald Trump might end up choking off the very pipeline through which young overseas students trickle into the US job market: College education.
This month’s hastily imposed Restriction on Entry of Certain Nonimmigrant Workers opened a new front in Washington’s increasingly ugly trade spat with New Delhi. Indian tech workers and doctors, who hold more than 70 percent of the existing visas under this category, read the move as an eviction notice from their careers and lives in the US. At least that is how Trump’s proclamation was received, until the White House clarified that a one-time US$100,000 fee on H-1B visas would only apply to employers of new applicants — and doctors may be exempt.
A separate proposal, announced last week, seeks to overhaul the H-1B lottery itself by introducing a wage-based rule into what is currently a random process. The retooling goes way beyond targeting India, or for that matter, the US$100,000 fee. Once implemented, it would dim the appeal of the F-1 student visa — a far more crucial source of US’ long-term competitiveness than the 85,000-a-year jobs quota. Although damaging the US university system is not the intended goal, that would be the unfortunate result.
The Department of Homeland Security said it is moving to a weighted selection process that would “favor the allocation of H-1B visas to higher skilled and higher paid aliens.” So far, so good. However, demand for these visas has exceeded supply each year for more than a decade, the catch lies in the complex manner in which the quota is going to be distributed. Currently, most of the approvals go to California because tech-industry employers, such as Amazon.com Inc and India’s Tata Consultancy Services Ltd, the largest Indian outsourcing firm, seek them aggressively.
Silicon Valley’s dominance might continue even under the new rules, as would the rampant gaming of the H-1B system by outsourcing firms. However, fresh, foreign-born science, technology, engineering or mathematics (STEM) graduates may lose access to the one US talent market where their education and skills are the most valued.
Until now, once they got a job offer and it was time to switch their status from F-1 to H-1B, computer-science graduates had the same chance of getting selected as a mid-career techie from India. Now, they would face an inbuilt bias against their youth. To even put their hat in the ring for a software-development H-1B, their prospective employer would need to offer them a minimum salary of US$136,000 in San Francisco county. After they secure this offer, they would face a 4:1 disadvantage in the visa sweepstakes against experienced immigrants coming in to work on artificial intelligence projects at an annual salary of US$214,000-plus.
Naturally, new computer-science graduates would likely get elbowed out of the Bay area, or chased out of the US entirely. That is because the revamped lottery would prefer a foreign-born landscape architect at US$97,000, the top pay for the profession in Las Vegas. To enjoy the same odds, the freshly minted software developer, if she is not a US citizen or permanent resident, would need a Vegas job paying US$164,000, or a US$139,000 offer from Des Moines, Iowa. (Geography as well as occupation would matter under the plan. The calculator that spews out the numbers is available online.)
The US does need aesthetically pleasing golf courses and competitively priced nail salons, but it also must create jobs for Americans at the cutting edge of technology. That is the promise that each young computer scientist implicitly makes to the host society when H-1B allows them to start a career as an executive, start-up founder or researcher. This contract is now broken. Since most international students at four-year US undergraduate programs self-finance their education, the lure of an expensive US STEM degree would plummet under the new rules.
That would be a shame. Every fifth person pursuing a STEM career in the US is foreign-born. The talent pool of more than 7 million is drawn from around the world, but principally from five countries: Mexico, India, China, the Philippines and Vietnam. Not all might have attended a US university on an F-1 visa, but many have.
This might change. The nativist right-wing view in the US supports doing away with practical training, which is how immigrant students get to stay on after finishing their coursework and look for a job. New cohorts are likely to be discouraged, while existing students are going to start weighing rival offers. German Ambassador to India Philipp Ackermann has already taken to social media with a sales pitch. “Our migration policy works a bit like a German car,” Ackermann said. “It is reliable, it is modern, it is predictable.”
Do you think parents in Mumbai or New Delhi, already fearful about US immigration raids, would not relay this message to their children at Brown University or University of California, Berkeley?
The world’s faith in the dollar already appears to be cracking under the weight of the trade war. After the greenback, if there is another piece of paper that is keeping the US economy in pole position, then it is the F-1 visa, acting as a pathway to H-1B, permanent residency and eventually citizenship. The Trump administration must not devalue it.
Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services in Asia. Previously, he worked for Reuters, the Straits Times and Bloomberg News. This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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