The Trump Effect on the Indian IT Industry
According to a recent Bloomberg report, the Trump administration has come up with another draft to overhaul H-1B work visa. H-1B is widely used by tech companies to bring in talent from other countries to fill highly qualified jobs.
It is predicted that this move would have an adverse effect on the Indian IT sector. This has triggered massive concerns in the $147 billion Indian IT industry. The proposal is to protect American Jobs and Workers by curbing the Foreign Worker Visa Programs, mainly the H-1B visa. Indian IT companies mainly use this visa to send thousands of IT workers to perform skilled technology work in the US. The intention of the Trump government is to prevent foreign workers from taking up jobs in the US market. This comes right after Trump ordered the citizens of seven countries from entering the US.
So what is the H-1B visa?
The main visa category under which the Indian IT workers are employed is the H-1B. Under this program, companies are temporarily allowed to bring foreign workers to the USA, as non-immigrants for occupations classified as highly skilled. They should possess specialized theoretical and practical knowledge and a bachelor’s degree or an equivalent in specialties of sciences, medicine, healthcare, education, etc. The H-1B visa is given for three years and extended to three more years.
What is the concern of the IT industry over the proposed US laws?
This law could affect or deploy the Indian IT workers who fall in the H-1B and L-1 category in the United States. Also, Indian firms earn more than 60% of their revenues from the technologies they provide to the US market. They heavily rely on America’s visa policies to deliver cost-effective IT solutions.
The Indian IT companies are among the top 10 companies seeking H-1B visas. From the 12 lakh high skilled jobs given to the H-1B visa holders in 2015, Indian IT companies including Cognizant, TCS, Wipro, iGate and Infosys filled nearly 2.54 positions. However, in 2016 the number decreased to 1.72 lakh, as per the US Labor department records. Drastic alterations in the H-1B and L-1 visa policies are further expected to impact their revenues by around 10%.
What we know so far:
At present, the US legislature gives 85,000 work visas annually. We are unclear if the draft will lower the number of people allowed to enter the US under such programs. If so, then by how much — will it become harder to get an application approved?
Trump has been pretty vocal about his “America-first” agenda (as obvious in his speeches). The new move plans to make it harder for the companies working in the USA to bring in employees from abroad. So that the companies will be compelled to hire domestic talent.
Forbes Magazine has done a great job of explaining the proposed draft in this video.
Video — Courtesy Forbes Magazine
The H1B is one of the most common visa programs for foreign workers in the United States. However, changes to the…www.forbes.com
The passage in Bloomberg reads:
“Our country’s immigration policies should be designed and implemented to serve, first and foremost, the US national interest. Visa programs for foreign workers — should be administered in a manner that protects the civil rights of American workers and current lawful residents, and that prioritizes the protection of American workers — our forgotten working people — and the jobs they hold”.
Bloomberg says the draft covers other visa programs apart from H-1B (popular with tech companies) such as L-1, E-2, and B1.
The draft wants to add more transparency to the visa programs by releasing to the publish reports with detailed statistics on who uses the program.
Trump made it clear in his pre and post-election speeches that he’ll be reforming the H-1B and other visa programs. From all this, we know that he wants to boost the US workforce and economy by making rules which in turn make it hard to hire or import products from other countries.
My take on this:
Personally, I think skilled people shouldn’t be limited by any borders. Immigration creates jobs and reduces crime rates. More importantly, IT professionals are not interchangeable. You cannot simply replace Immigrant Engineer A working at Company B with an American Engineer C. Not would you want to do this. If you are replaceable, then you are not a good engineer. Very sorry.
Individually, such good IT employees are valuable. Importantly, a large mass of them is spectacularly good. The Silicon valley and essentially the tech industry is fundamentally based on this concept of bringing exceptional IT talent to lead to an outcome 100X beyond the investment they make in this talent.
And the result is an extraordinary success.
Amid this, it is hard to believe brands pushing “hire American” bills and wrongly thinking this bias would lead to the best outcome for America. (Unfortunately, it won’t.)
The immigrant workforce form an important part of the tech companies and are not just better, but 300X better! Because exceptional talent does exist. And it’s silly to pretend such a talent is limited by national borders. We live in a world where tech resources are not interchangeable.
Sadly, we live in a world where the American administration does not believe in immigration. Also, it is clear and well-known among the immigrants that more than one-third of Americans are anti-foreigner. Such a move will affect thousands of skilled labor and the economies of many countries.
Originally published at www.linkedin.com on February 28, 2017.