Limiting High-Skilled Visas Hurts U.S. Startups
TLDR: As the technology industry looks to President-elect Joe Biden to overturn the Trump administration’s immigration policies limiting access to high-skilled foreign talent, startups are continuing to pressure Congress to defend and expand the H-1B visa program. Tech companies rely upon the contributions of high-skilled foreign-born workers to drive innovation, but limiting access to this talent—particularly during the pandemic—could harm the long-term growth of U.S. startups.
What’s Happening This Week: Even as U.S. technology companies underscore the need for the incoming Biden administration to reverse President Donald Trump’s policies limiting access to foreign-born talent, entrepreneurs remain concerned that the Trump administration will further clamp down on the H-1B visa program before President-elect Joe Biden is sworn into office next year. As a result, startups and tech firms are continuing to highlight the critical importance of the H-1B visa program for America’s entrepreneurial community.
Engine sent a letter to congressional leaders last week expressing concern with the Trump administration’s ongoing efforts to restrict H-1B visas and suspend entry for H-1B and other visa recipients, noting that startups and the broader tech industry rely upon the contributions of high-skilled foreign workers to drive U.S. innovation. President Trump issued a proclamation in June suspending the issuance of new non-immigrant visas—including the H-1B visa program for high-skilled workers—on the grounds that the move was necessary to preserve U.S. jobs amid the coronavirus pandemic.
The Department of Homeland Security last month took additional steps to undermine the H-1B program, releasing interim final rules to further restrict H-1B visas for foreign-born workers by limiting the definition of specialty occupation and narrowing eligibility for high-skilled visas. Once again, the administration cited the impact of the COVID-19 pandemic as necessitating the action, even though the industries that most benefit from the H-1B visa program typically enjoy low unemployment rates where demand for jobs outpaces what the U.S. talent market can supply. The change is likely to impact more than one-third of all H-1B petitions. DHS also introduced a proposed rule to effectively eliminate the H-1B visa lottery, replacing it with a wage-based system that prioritizes the highest-paid positions. This change, if implemented, would impact companies seeking to hire talent across multiple employment levels and could have a significant impact on entry-level positions and international students.
Why it Matters to Startups: The Trump administration’s decision to suspend foreign work visas and further restrict H-1B visas will hamper new startup formation, decrease U.S. innovation, and force high-skilled talent to look elsewhere for opportunities in the technology industry. Foreign-born workers—particularly those on H-1B visas—help keep the U.S. at the forefront of global innovation, and limiting tech companies’ access to this talent could compound many of the problems caused by the ongoing pandemic.
As we noted in our recent letter, “[n]ot only do current and proposed restrictions on H-1B visas limit job creation in the U.S., but the unfavorable immigration environment surrounding high-skilled immigration may lead multinational companies to transfer jobs out of the country or choose to entirely grow their endeavors elsewhere.” By making the U.S. a less hospitable destination for talented workers across the globe, the White House is harming the country’s ability to remain ahead of global competitors by turning away foreign-born workers who can help drive the nation’s long-term economic recovery once the pandemic has abated.
After President Trump issued his proclamation suspending the issuance of new non-immigrant visas this summer, Engine and a coalition of 118 startups and other tech companies sent a letter to the White House highlighting the importance of high-skilled talent to the entrepreneurial community and urging the administration to rescind its move. As we noted, “[o]nly with access to a global pool of talent can companies and entrepreneurs advance new technologies and keep America at the forefront of global innovation.” By pursuing policies that limit companies’ access to qualified talent, the Trump administration is curtailing the ability for startups and other tech firms to innovate on a global scale. And with DHS’s new regulatory actions likely to further restrict opportunities for foreign-born workers, U.S. companies may be forced to consider relocating their business operations to another country in order to meet their workforce-related needs.
Contrary to protecting jobs amidst the coronavirus pandemic, efforts to limit high-skilled workers may actually have a negative effect on U.S. workers. Studies have shown that the H-1B visa program creates new U.S. jobs and that expanding the program further could result in the creation of up to 1.3 million American jobs by 2045. And moving to limit the H-1B visa program could, in turn, limit the number of new tech jobs in major metropolitan areas.
Foreign-born entrepreneurs also found new companies at rates that are significantly higher than those of native-born Americans. This, in turn, creates new jobs and opportunities for tech workers across the country, and ensures that the United States continues to produce the most innovative tech-related products and services possible. Limiting the ability for these high-skilled workers to contribute to the country’s economy, however, will dampen the growth and development of future U.S. startups and tech companies.
Although President-elect Joe Biden has pledged to reverse many of the Trump administration’s immigration policies and work with Congress on increasing the number of visas for high-skilled workers, it is critical that lawmakers acknowledge the important contributions of foreign-born talent to the tech industry. By not moving to quickly rescind these misguided steps, policymakers risk causing irreparable harm to startups and tech companies that are already dealing with the economic fallout caused by the pandemic. If policymakers want to drive startup growth, they should work to support, protect, and expand the H-1B visa program in a way that welcomes the best and brightest entrepreneurial minds to the United States.
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