USA

Indian IT Firms To Be Hit By Latest H1B Changes

Empire State Building

Google, Microsoft, Amazon, and Intel among the top companies hiring expats in 2017
Expat hires by Indian It firms dropped by 6,324 in 2017
It companies fear that electronic registration may discriminate against them

A rising number of visa application rejections and stringent documentation have already made it hard for Indian IT Firms in the USA to hire expats.

The latest changes favoring applicants with advanced degrees from US institutions may farther impede their hiring process. Read on to find out more.

As a result of a recent change in immigration rules by the Trump administration, Indian IT companies may lose out to larger global firms in getting engineers with the US work visa. This is because the new rule favors H1B visa applicants with advanced degrees from US universities.

Empire State Building

Currently, Indians are issued the largest percentage of H1b visas each year. Over two-thirds of visas issued to non-immigrant technology workers are issued to Indians. However Indian IT firms have been forced to reduce their dependency on these visas because of rising protectionism.

The new rule has made it challenging for IT companies to choose between a fresh graduate of a US university and an IIT graduate with a few years of work experience behind him. This, in turn, is set to affect the US clients of these companies as well.

Indian Vs US IT Firms

According to a study conducted in April 2018 by a US think tank, the National Foundation for American Policy, companies such as Google, Amazon, Intel, and Microsoft were among the top 10 companies employing immigrants on H1B visas in 2017.

These companies typically offer salaries much higher than those offered by Indian companies. Thus, they are more attractive to highly skilled talent.

The study also revealed that the top 7 Indian IT firms received 6,324 fewer H1B visas in 2017 as compared to 2015. One of the main reasons for this drop in numbers is the increased number of visa applications being rejected

The H1B Visa Changes Introduced And Their Effects

In late January 2018, the US Department of Homeland Security (DHS) submitted a final rule on the amendment of the H1B approval process. This amendment will change the way H1B visa applications are processed to give preference to applicants with advanced degrees from US universities for the first lottery.

65,000 visas are awarded through his initial lottery. As a result of this change, the number of H1B visas granted to applicants with advanced degrees from a US institution could increase by 16%.

An electronic registration system for visa petitioners will also come into effect by April 1^st, 2019. Indian companies fear that this may be used to discriminate against them.

The Future For Indian IT Firms

The changes in the immigration process will make it increasingly difficult for Indian IT firms to hire expats. While many firms have already increased local hiring in the USA many are expecting to be able to hire more Indian technology students with advanced degrees from the US after the new rule comes into being.

Some Indian IT firms are also looking at subcontracting work to offices in nearby countries. What remains to be seen is how these changes affect the profit margins and company bottom lines.