The Donald Trump administration is planning to raise the minimum salary levels for foreign workers entering the US on H-1B visas, in a move aimed at making it harder for companies to hire them at lower wages instead of American workers.
According to a Bloomberg report, an entry-level software engineer in Silicon Valley or San Francisco may need to be paid around $162,000 per year to qualify for an H-1B visa under the proposed wage structure.
The required salary could be around $113,000 in Dallas and $132,000 in New York, depending on the job location and prevailing wage levels.
While the move may appear positive for foreign workers because of higher salaries, immigration experts are cautious. They say companies may become less willing to hire H-1B workers if costs rise sharply.
In addition, the proposed $100,000 visa fee for hiring H-1B workers from outside the US remains a major concern.
The report, citing an analysis by immigration data firms Lawfully and Threshold, said the new wage rule could cost the biggest employers of white-collar foreign workers at least $18 billion in the first 12 months.
Within three years, when many existing H-1B visas come up for renewal at the higher wage levels, the annual cost could rise to as much as $43 billion.
The proposed salary hike is still awaiting final approval from the Labor Department.
Supporters of the move argue that higher wage levels will ensure that H-1B visas are used only for truly specialised workers.
Ronil Hira, an associate professor of political science at Howard University, said there must be a way to ensure that the labour market is not distorted.
According to him, the simplest way is to make sure that workers being brought in really have specialised skills, and wages are one way to signal that.
The Labor Department had issued a Notice of Proposed Rulemaking in March, proposing the new wage levels.
As part of the H-1B, H-1B1 and E-3 visa sponsorship process, employers must obtain a certified Labor Condition Application from the Department of Labor.
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In that application, employers must confirm that they will pay the foreign worker either the actual wage paid to similar employees or the prevailing wage for that occupation in the area of employment, whichever is higher.
Similarly, employers sponsoring foreign workers for EB-2 or EB-3 employment-based green cards through the PERM labour certification process usually need to obtain a prevailing wage determination from the Department of Labor’s Office of Foreign Labor Certification.
If approved, the new rule could significantly increase hiring costs for US companies and reshape the way employers use the H-1B visa programme.
