Why Trump wants to charge US$100k for H-1B visas

WASHINGTON - After focusing on immigration enforcement and boosting deportations for much of his second term, US President Donald Trump is expected to push new measures upending the H-1B visa programme, a cornerstone of the employment-based immigration system that allows US companies to hire college-educated foreign workers for specialised occupations.

The executive order, which comes into force on Sept 22,

requires a new US$100,000 (S$130,000) fee to petition for H-1B workers

and asserts that abuse of the programme has displaced US workers, according to a White House official familiar with the matter.

What exactly is the H-1B visa programme?

Introduced in 1990, the H-1B visa programme is one of a series of US immigration initiatives created during the 20th century to address specific labour shortages.

Others facilitated the employment of temporary farm workers from Mexico during World War II, sheepherders mainly from Spain in the 1950s, and nurses, many of whom came from the Philippines, in the 1990s.

Today, employers can apply to bring in foreigners to fill temporary agricultural jobs under the H-2A programme and workers for other kinds of temporary jobs, including seasonal work, under the H-2B programme. 

H-1B visas are used primarily by the tech industry, whose leaders say there is a dearth of professionals with science, mathematics and computer skills.

“Computer-related” occupations accounted for about 65 per cent of H-1B approvals in fiscal 2023. Applicants must have at least a bachelor’s degree. The visas are temporary, lasting as long as six years, but can be extended indefinitely if a company has sponsored a worker’s employment-based green card application for permanent residency in the US.

How does the H-1B programme work?

Employers must petition the government for any workers they want to hire on an H-1B visa. New visas issued each year are capped at 65,000 – plus an additional 20,000 visas for those with a master’s degree or higher from the US.

Demand from employers far exceeds that limit, so employers must register prospective workers in an annual lottery, a process that moved online starting in 2020. Companies submitted more than 470,000 eligible entries for the fiscal 2025 visa lottery.

What else does the Trump administration want to change? 

Mr Trump is expected to direct the Department of Labour to undertake new rulemaking on minimum wages required for H-1B workers. A similar effort to raise the lowest required wages for H-1B workers during the first Trump administration was blocked by federal courts over procedural violations.

The Department of Homeland Security has already signalled plans to issue proposed regulations doing away with the randomised lottery to allocate H-1B visas. Business groups warned that a proposal to end the lottery and steer visas to higher-paying jobs during Mr Trump’s first term would cut off hiring of recent foreign graduates at US colleges. 

What are the arguments for and against the H-1B visa programme?

Business groups support the programme but say it needs to be expanded because the quotas on H-1B visas as well as on green cards limit their ability to fill critical labour shortages.

Supporters of the programme cite research showing that the professionals admitted under the programme – mostly workers who moved to the US for college or graduate programmes – deliver benefits to the country.

They have been shown to make more patent applications than their peers and to increase a start-up’s chances of obtaining funding and of winning patents. Their innovation and productivity has been shown to lead to lower costs for consumers. 

The programme’s critics, on both the right and left, have attacked it for undermining employment of skilled US workers. 

In December 2024, a row erupted on social media platform X between Mr Trump’s new allies in the tech industry and more traditional Trump loyalists over the merits of H-1B visas. It came after Trump confidante and right-wing influencer Laura Loomer criticised Mr Trump’s appointment of Mr Sriram Krishnan, an Indian-American venture capitalist, as his adviser on artificial intelligence. 

Mr Krishnan has argued for more foreign skilled workers in America’s tech industries and supports ending green card country quotas. The annual limit for employment-based green cards issued is 140,000, and only 7 per cent of those can be awarded to individuals from a single country. This has created a significant backlog for countries with large populations, such as India, for example.

Mr Elon Musk, chief executive of Tesla and SpaceX, jumped on X to aggressively defend legal immigration for filling a “dire shortage” of talent in the US, while insulting its critics at the same time.

Mr Trump, after attempting to limit the visa programme during his first presidency, weighed in to say he had “always been in favour of the visas” and had used them many times.

How has the H-1B visa programme been changed in the past?

The Biden administration in 2024 revamped the annual H-1B lottery to flatten the odds for individual workers and address suspected fraud by some employers.

The Homeland Security Department said a rapid rise in registrations since 2020 could be attributed in part to companies colluding to artificially boost lottery odds with multiple entries on behalf of individual workers without a bona fide position.

The lottery overhaul led to a steep drop in lottery entries, but the number of eligible registrations still far outstrips available visas under the cap. 

New regulations also strengthened the oversight powers of the US Citizenship and Immigration Services, including requirements for employers to comply with workplace visits. BLOOMBERG