US H-1B Visa Reform: $100,000 Threshold Crushes Startups, Global Tech Talent Mobility Reordered
On September 26th, it was reported that US President Trump signed an executive order on the 19th local time, significantly reforming the H-1B visa program. Applicants are required to pay a fee of $100,000; otherwise, they will not be allowed to enter the country. This sudden policy change has not only plunged Silicon Valley tech giants and startups into cost anxiety but also triggered a chain reaction in the global talent market, reshaping the global talent competition landscape.
01. Policy Implementation: The $100,000 Threshold Shatters the Myth of the “Golden Passage”
As the core visa type for the US to attract high - skilled labor from around the world, the H-1B visa was previously regarded as the “golden passage” for foreign talents in the fields of technology, healthcare, and scientific research. However, the sharp increase in fees has completely shattered the expectations of both enterprises and talents.
The White House stated in the policy interpretation that this move aims to “prevent US companies from using cheap foreign labor to replace local workers,” emphasizing that the original intention of the H-1B visa was to introduce scarce professional talents, not a “shortcut to bypass local employment.” However, this explanation has not quelled the controversy. From Wall Street financial institutions to Silicon Valley tech companies, from university laboratories to community healthcare facilities, almost all enterprises relying on foreign talents have begun to urgently recalculate their labor costs.
Data from the US Department of Labor shows that in the fiscal year ending in September 2024, US companies submitted more than 480,000 H-1B job applications, doubling compared to five years ago, while the visa approval rate was less than 20%. Jennifer Hunt, a professor at Rutgers University, pointed out: “In the past, companies were willing to pay a few thousand dollars as a ‘lottery ticket’ for each candidate. But now, they have to pay $100,000 upfront for a position with an uncertain lottery outcome. The decision - making logic has completely changed.” The uncertainty of the policy is more off - putting to companies than the cost itself.
02. Market Differentiation: Tech Giants Under Pressure, Outsourcing Companies Suffer a “Fatal Blow”
In this policy storm, enterprises of different sizes and types are facing very different dilemmas. As the largest user of the H-1B visa, Amazon submitted 21,600 applications in the 2024 fiscal year. However, data shows that more than 95% of its applied positions had an annual salary of less than $225,000, which economists consider the salary line for the “break - even point of a three - year visa.” “It's like spending $100,000 on a lottery ticket. Even if you win, it may not cover the cost,” a non - named Amazon recruitment manager revealed. The company is considering reducing H-1B recruitment for mid - level positions and concentrating the quotas on high - end R & D fields.
Google and Microsoft are also in anxiety during the AI competition. Each company applied for more than 4,000 H-1B visas in the 2024 fiscal year. Most of the positions were concentrated in the technology fields with an annual salary ranging from $100,000 to $200,000, covering key directions such as large - model training and algorithm optimization.
“If the US sets artificial barriers, companies can only vote with their feet.” An engineer in charge of AI R & D at Microsoft revealed in an interview that the company's management has clearly discussed “diversifying talent distribution” in the quarterly strategic meeting. It plans to expand the size of the technical teams at its R & D centers in Toronto and Vancouver, Canada, by 50% in the next two years and increase investment in its Dublin office in Ireland to undertake some R & D projects originally planned to be carried out in the US. Google has also adjusted its strategy accordingly. Its European regional head said at a recent industry summit that it will further expand recruitment at its data centers in Warsaw, Poland, and Berlin, Germany, especially focusing on recruiting AI engineers and data scientists who are blocked by the US visa policy.
In contrast, Indian outsourcing giant Tata Consultancy Services can be regarded as the “biggest loser.” Among the more than 9,600 applications submitted by the company in the 2024 fiscal year, none of the positions had an annual salary exceeding $225,000, with an average annual salary of only $89,000. The positions were mainly concentrated in mid - level outsourcing services such as IT system maintenance and basic software development. “Tata's business model highly depends on low - cost labor outsourcing. The $100,000 visa fee directly skyrockets the cost of each outsourcing position, completely subverting its profit structure,” an analyst who has long tracked the Indian IT industry said.
03. Dilemma of Startups: $100,000 Becomes the “Life - and - Death Line,” and the Innovation Ecosystem Is Impacted
Compared with well - funded tech giants, startups, non - profit organizations, and university research teams are facing a “survival crisis.” “This fee may directly force us out of the game,” Mark Chen, the founder of a startup in California focusing on AI medical image analysis, said frankly in an interview. His company just completed a $5 million Series A financing in June this year and originally planned to recruit two core algorithm engineers through the H-1B visa to promote the clinical implementation of a lung cancer early - screening model. “Now, the $100,000 visa fee is equivalent to our six - month operating cost, and we're not even sure if we'll win the lottery. We simply can't take this risk,” Mark Chen said.
John Skrentny, a professor at the University of California, San Diego, pointed out in his latest research report that the financing scale of US startups has decreased by 35% year - on - year in the past two years. Against the backdrop of a tightening financing environment, the $100,000 visa threshold may cause more than 20% of tech startups in the seed and angel investment stages to abandon recruiting foreign talents and even directly terminate cross - border technology cooperation projects, causing “irreversible damage” to the US innovation ecosystem.
The talent shortage in healthcare facilities and universities is also severe. Ryther, a non - profit organization in Seattle, mainly provides mental health services for immigrant families. It currently employs two Chinese therapists with H-1B visas. Both of them not only have professional psychotherapy qualifications but also can communicate fluently in Mandarin and Cantonese with Chinese - American families, solving treatment barriers caused by cultural differences. “Our annual operating budget is only $3 million. We simply can't afford the $100,000 visa fee. Moreover, in the US, talents who understand both professional psychotherapy and Chinese culture are very scarce, and we can't find substitutes in the short term,” Karen Brady, the CEO of the organization, said.
US universities are even more worried. Immigration Bureau data shows that more than 10% of university professors and researchers were born outside the US. In cutting - edge disciplines such as computer science, biomedicine, and quantum physics, the proportion of foreign researchers exceeds 30%. Many of them initially stayed in the US for research through the H-1B visa. “Three post - docs in our laboratory will have their H-1B visas expire next year. We originally planned to apply for renewal, but now the $100,000 fee makes it impossible for the school to approve. If we can't keep them, the ongoing research project on cancer - targeted drugs will be stalled,” a laboratory director at the University of Pennsylvania School of Medicine said helplessly.
In fields such as artificial intelligence and quantum computing that highly depend on global talent collaboration, if the US continues to tighten its visa policy, it may lose its technological leading edge in the next 5 - 10 years. Currently, some universities have begun to establish “joint laboratories” with universities in Canada and the UK, providing “dual - base” work options for core foreign researchers.
04. Voices from the Business Community: Optimism and Anxiety Intertwined, and the Future Is Full of Uncertainty
Jensen Huang, CEO of NVIDIA
Facing the new policy, global business leaders have divided views, highlighting the complexity of the policy's impact. Each business tycoon has put forward very targeted opinions based on their own industry characteristics and corporate strategies. Among the supporters, Reed Hastings, the chairman of Netflix, called it an “excellent solution,” believing that the fee will increase the certainty of the H-1B visa and make it truly used for high - value positions. Sam Altman, the CEO of OpenAI, and Jensen Huang, the CEO of NVIDIA, also said that the fee can enhance the US's attractiveness to top talents.
Cathie Wood
Critics hold different views. Cathie Wood of Ark Investment warned that this “policy instrumentalization” approach will damage the US's international credibility and make talents from other countries develop a “sense of distrust” towards the US market, which is not conducive to the US's position in global technological competition in the long run. Jamie Dimon, the CEO of JPMorgan Chase, bluntly said that the policy “caught everyone off guard” and called on the government to promote “merit - based immigration” instead of raising the threshold. Kevin O’Leary, an investor on “Shark Tank,” warned that the $100,000 fee will kill the next “garage startup” and damage innovation in the long term. Michael Moritz, a partner at Sequoia Capital, called the new regulation “chaotic and hasty,” saying that it will only push jobs to overseas technology centers such as Bangalore and Warsaw. Dave McKay, the CEO of the Royal Bank of Canada, regarded it as a “historic opportunity” for Canada to attract skilled immigrants.
Behind the different views of business leaders, from tech giants to financial institutions, from venture capital to growth - oriented enterprises, are the different demands for talents of enterprises in different industries and of different sizes. Optimists see the new policy's role in promoting the “screening of top talents,” while the anxious worry about the damage to the innovation ecosystem and the outflow of talents. This divergence itself also reflects the complexity of the new H-1B visa policy: it is not only an adjustment of immigration policy but also affects the deep - seated changes in the US economic structure, global talent flow, and international competition landscape. Where the policy will ultimately go and whether it will be adjusted according to market feedback still need time to tell.
This article is from “Tencent Technology,” author: Wuji. It is published by 36Kr with authorization.