US President Donald Trump’s $100,000 price tag for new H-1B workers hired from outside the United States will impact the IT outsourcing and staffing industries.
A Bloomberg analysis has found the fee will have a disproportionate impact on multinational staffing firms that act as middlemen for companies seeking H-1B workers, including Infosys, Cognizant, and Tata Consultancy Services.
Almost 90 per cent of new H-1B hires at those three companies between May 2020 and May 2024 were approved at US consulates.
The workers would have cost each of them hundreds of millions more if the fee had been in effect.
More than 93 per cent of new Infosys H-1B hires in that timeframe—upwards of 10,400 workers—would have been hit with the $100,000 fee, according to Bloomberg, adding up to more than a billion dollars in visa charges.
Tata would have had to pay the fee for 6,500 workers over that period, or 82 per cent of newly approved H-1B workers. Cognizant would be faced with the charge for more than 5,600 employees, or 89 per cent of new H-1B hires.
With India supplying a significant portion of H-1B talent, companies may now boost operations there rather than pay higher visa-related expenses.
Workers from outside the US, rather than recent international graduates of US colleges already in the country, accounted for more than four out of 10 new H-1B hires approved over the past four years, according to data analysed by Bloomberg.
IT employers took advantage of an online lottery process set up by Trump officials in 2020, allowing them to register H-1B workers for a low fee and without a detailed petition.
The number of entries grew at breakneck speed, topping 758,000 eligible registrations in fiscal 2024.
Several states and business groups have filed challenges against the fee, including the US Chamber of Commerce. Despite ongoing litigation, many firms are already adjusting to the new cost structure by reducing H-1B applications or shifting to offshore delivery models.
The updated fee structure has resulted in reduced visa lottery registrations.
“We’re already seeing that happen,” said immigration attorney Jonathan Wasden, who represents many IT employers. “The fear is that if you have truly exceptional talent overseas, those people are definitely going to be missing out," Wasden told Bloomberg.
Alongside the new $1,00,000 fee, structural changes to the H-1B lottery system may further discourage mass registrations.
The Trump administration claimed the higher fee serves to prevent system abuse and support high-skilled, high-wage visa applicants. Observers have predicted a noticeable decline in low-wage or middle-layer consultancy hires under this regime.
