USA and the UK
Trump Proposes New Measure to Increase H1B Visa Wage Levels
The US Department of Labour has proposed a steep increase in the H1B visa wage levels. Such a move would make hiring an H1B worker more costly. This proposal is a part of the Trump administration’s attempts to dissuade companies from employing overseas workers and outsourcing their workforce.
The move is likely to hit Indian IT firms the hardest, as Trump attempts to solidify his ban on US work visas and push forward his ‘America first’ policy. The proposal was submitted to the Office of Management and Budget (OMB), and it is claimed that the measure will stop firms from brining in workers to do jobs that can be done by Americans.
Those opposed to the proposal have argued that mid-sized and start-up companies would suffer, as well as bigger firms.
President Donald Trump hopes the new measure will dissuade companies from hiring overseas. [Image credit: Variety]
The main beneficiaries of H1B visas include Tata Consultancy Services (TCS), Infosys, Wipro and HCL – all Indian IT companies. They would be forced to pay H1B visa workers a higher salary, which would increase their operating costs. The majority of H1B visas are awarded to Indian IT firms with branches in the United States.
Moneycontrol, an online business news site, said: “An HDFC report shows that average H1B wages increased sharply over the last two years for IT services companies. From a median salary of $78,120 in FY17, it has increased to $90,730 in FY19.”
This proposal is a part of the Trump administration’s attempts to dissuade companies from employing overseas workers and outsourcing their workforce.
Local Workforce Hiring Increases
US visa immigration rules are becoming more restrictive and as a result, most Indian IT firms have increased local hiring over the last twelve months.
Infosys reported that they have recruited more than 13,000 U.S nationals as part of a local recruitment drive and said they “want to build local talent structures in all the locations that we operate in.”
The proposal is reportedly being fast-tracked and will redefine what is classed as a ‘speciality occupation’ under the H1B visa category. This is likely to lead to a reduction in the number of skilled workers who are eligible for the H1B visa.
Insofys is one of the companies expected to be hit hardest if the measure comes into law. [Image credit: CNBC]
Change Before Election?
There is speculation that the Trump administration may push through the proposed changes before the presidential election in November.
India’s Economic Times said: “If given the go-ahead, it will be implemented immediately without public comment, unlike the case with most other rules.”
The Trump administration is also considering increasing the visa wage levels for the H1B1 visa and the E3 visa.
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