Impacts of H-1B Visa Applications Suspension

There’s a new stake in the ground for H-1B visa reform. Beginning on April 3, 2017, the US Citizenship and Immigration Services (USCIS) will temporarily suspend premium processing for all H-1B visa petitions. Large U.S. tech firms stand out as firms that will suffer disruption from the suspension, but the impact will be felt most heavily among India’s service providers, all of which typically use the premium processing option.

The announcement stated the suspension may last for six months and impacts visa applications for FY18. A premium processing fee of $1,225 expedites the normal three to six months wait for visa decisions to 15 days. While there are several potential impacts, two rise above as the most significant threats to business in the near term:

  • The suspension is more likely to affect current visa extensions than new applicants. Thus, it could cause staffing gaps, especially since there is already a large backlog of applications for visa extensions.
  • It may hinder Indian providers’ ability to obtain the large number of new visas they desire, so they are likely to rev up their applications in coming months.

Based on the current political climate with an “America First” focus, one could assume that the Trump Administration is the proponent of the suspension, but the USCIS announcement didn’t specify a reason other than the current backlog. However, visa laws are outdated and H-1B visas have been a candidate for the reform “chopping block” for several years. So, what can we glean regarding the progress of visa reform from this recent move?

I believe the suspension could usher in an ideal opportunity to revise the visa program later. Undoubtedly, another outcome that will emerge is increased media attention on Indian service providers versus US jobs, as they historically heavily exploited the visa laws. As I recently blogged, Everest Group already is seeing evidence of businesses postponing or cancelling plans to outsource work to Indian service providers.

Finally, it’s clear that visa reform is still teetering as the existing proposals have not garnered enough compromise and support in Congress. What will be the Trump effect on moving the proposals forward? I’ve watched and blogged about this important issue since May 2013 and will continue monitoring the potential impacts of proposed visa reform.