US Election 2024: ‘Buy American and Hire American’ — Will H-1B visa turn ‘cold’ if Donald Trump wins?

The outcome of the upcoming US presidential election could have major implications for employment-based immigration, particularly with regard to H-1B visas, a report by JM Financial highlighted.

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The report noted that if Donald Trump were to regain power, his administration's previous restrictive policies could resurface, potentially leading to increased scrutiny and denial rates for H-1B and L-1 visas, ANI reported.

During his first term, initial denial rates for H-1B visas surged from 4 per cent to 17 per cent, while L-1 visa denials rose from 12 per cent to 28 per cent. This trend could re-emerge, impacting IT services firms that heavily rely on these visas.

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The report said, “In his first term, Trump, through his executive order E.O.13788 “Buy American and Hire American,” increased restrictions on H-1B visas.”

However, the landscape has shifted since Trump's first term. Many IT services companies have significantly reduced their reliance on H-1B visas, with estimates indicating that the proportion of visa-dependent employees has dropped from 65 per cent to below 50 per cent in recent years.

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This shift insulates these firms from potential spikes in denial rates as they have increasingly localised their workforce in the US.

Moreover, Trump's administration previously attempted to implement policies that would raise minimum wage requirements for H-1B visa holders, pricing some employers out of the market.

Although these measures were blocked in court, they could serve as precursors to more restrictive policies if Trump returns to office. Current analyses show that H-1B wages are already 25-35 per cent above prevailing wages, making claims of wage suppression increasingly difficult to substantiate.

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The report suggested that “while a Trump presidency may be headline-negative, its impact on Indian IT services players will likely be limited.” In contrast, the report views a Harris presidency as maintaining the “status quo” on immigration policy.

Additionally, the evolving legislative landscape, including bipartisan bills aimed at reforming the immigration system, could also play a significant role in shaping the future of high-skilled immigration in the US.

 (With inputs from ANI)