Irony Of H-1B Visa Policy: Jobs Trump Is Trying To Protect Are About To Vanish Altogether

50 views Reading Time: 2 minutes

American President Donald Trump’s policy to protect jobs by imposing restrictions on H-1B visas is unlikely to be of any help to that country and may hurt US interests, say experts. What Trump is seeking to protect are entry level jobs that are being phased out by the tech majors, with automation, artificial intelligence and robotics paving the way to increased productivity.

“Skilled foreign workers who come to work in the US by the route of H-1B visas don’t just directly supplement the US IT industry with specialised skill sets, they also contribute indirectly to other industries in the US. Often H-1B workers bring their families along and thereby bring additional business for other industries like Real Estate, Banking, Hospitality to name a few,” said Sanchit Vir Gogia, Chief Analyst and CEO of Greyhound Research.

Gogia points out that the minimum salary requirement of US $130,000 is not too far from the current average and hence not a prohibitive figure to match. The current average salary of a skilled foreign worker employed via H-1B visa is $100,000. The newly announced minimum salary requirement of $ 130,000 is not prohibitive and can be managed by way of creative salary restructuring and including Per Diems, benefits and other allowances as part of base package.

As per Greyhound Research estimates, post this restructuring average margin hit for an IT Services provider will be in the range of 5-10 percent year-on-year depending on the total base of employees currently on H-1B, the existing compensation and need for onsite in near-term. Critical to note, a hit beyond this number will force these firms to either renegotiate contracts with existing clients or else the street will act ruthlessly and these firms stand to lose potential ground on market capitalisation.


To read the detailed research note on this topic by Greyhound Research, click here.

Leave a Reply