It could soon be a lot harder for U.S. companies to recruit skilled workers from overseas.
President Donald Trump signed an executive order Tuesday for a comprehensive review of visa programs that allow U.S. companies to hire foreign workers instead of their American counterparts.
On the campaign trail, Trump often railed against the H-1B visa, a nonimmigrant visa that lets U.S. companies employ foreign workers in specialty occupations. The H-1B has been a favorite of the tech industry, and tech leaders are anxious to keep it. But a recent research paper estimated the use of the visa had suppressed overall tech industry wages by up to 5.1 percent.
New Jersey would be the state most affected by a change to the visa system. In 2017, employers in the Garden State applied for around 5,400 H-1B visas per one million people, according to a CNBC analysis of data from MyVisaJobs.com, an aggregator of visa applications. Delaware , California and Massachusetts also are high on the list.
A large chunk of H-1B visa applications have historically been submitted by Indian outsourcing companies that get the majority of their revenue from the United States, including Infosys (National Stock Exchange of India: INFY-IN), Tata Consultancy and Wipro. The vast majority of applications are for programmer, software engineer, developer or analyst positions, and the average salaries for those visas tend to be much higher than the median American salary.
Alphabet (GOOGL), for example, applied for more than 4,000 positions in California with an average salary of more than $130,000. The median household income in that state is about $61,000. JPMorgan Chase (JPM) applied for about 1,000 visas in New York with an average salary of $126,000, compared with a median about the same as California's. Capgemini, Ernst & Young and Goldman Sachs (GS) also topped the list in that state, with similarly high salaries.
Companies have already started to pull back from the visa program. Only 199,000 applications were submitted for the 2018 fiscal year, according to data from the U.S. Citizenship and Immigration Services, cited by Bloomberg.
Congress has an 85,000-job cap on visas filled through the H-1B program, but demand has for years outpaced that supply.
We don't know who or what companies received the coveted visas, but they're allotted by random lottery, so the distribution of applications should give a sense of the areas that will be most affected by a change to the current visa system.
Trump announced the fresh order at Snap-on (SNA), a high-end toolmaker based in Kenosha, Wisconsin. Snap-on filed around 50 labor condition applications for H-1B visas over the past decade, according to MyVisaJobs.com. The positions were largely for analysts and auditors and were located in Kenosha as well as other company branches around the country.
"We employ a handful of associates under the H-1B visa program," a company spokesperson said in an email, "and the majority of them hold advanced degrees."
Snap-on has around 12,100 employees worldwide, just over half of whom are located in the United States. It has 10 manufacturing facilities in the U.S. and 18 abroad, according to the company and regulatory filings.
"The upskilling of the American workforce is the seminal issue of our time," Snap-on's CEO Nicholas Pinchuk said in a statement. "We must refocus on technical education, restore our respect for the dignity of work, and celebrate technical jobs not as the consolation prize of our society, but as what they really are — a national calling essential to our ongoing prosperity."
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