The proposed wage levels for H-1Bs will discourage companies from hiring them.
The Donald Trump administration is planning to raise the base salary of foreign workers who come to the US on H-1B visas so that they are not easily hired instead of Americans. Bloomberg reported that an entry-level software engineer in Silicon Valley, San Francisco would need to be paid $162,000 a year to qualify for an H-1B visa while the salary would be $113,000 in Dallas and $132,000 in New York. Experts are cautious not to immediately call this good news for foreign workers, though their salaries will increase, as this will make companies spend more for hiring them — and they might be discouraged. Plus, the $100K visa fee remains for hiring anyone on the H-1B visa program from outside the country.The report cited an analysis by immigration data companies Lawfully and Threshold and that it would cost the biggest employers of white-collar foreign talent at least $18 billion in the first 12 months. Within three years — when most existing H-1B visas will have to be renewed at the higher level — the annual cost could reach as high as $43 billion.The salary raise awaits final approval from the Labor Department.There has to be a way “to ensure that you’re not distorting the labor market,” said Ronil Hira, an associate professor in political science at Howard University. “The simplest way to do that is to ensure that the folks who are being brought in really do have specialized skills, and the way to signal that is by wages.”The Labor Department issued an NPRM (Notice of Proposed Rulemaking) proposing the new wage level in March. As part of the H-1B, H-1B1, and E-3 visa sponsorship processes, employers are required to obtain a certified labor condition application (LCA) from the DOL. The LCA must contain the employer’s attestation that it will pay the foreign worker the higher of either the actual wage level paid to all other similarly situated employees, “or the prevailing wage level for the occupational classification in the area of intended employment.” Similarly, an employer sponsoring a foreign worker in the second- or third-preference employment-based green card processes (EB-2 or EB-3) through a PERM labor certification application typically must obtain a prevailing wage determination (PWD) for the job opportunity from the DOL’s Office of Foreign Labor Certification’s (OFLC) National Prevailing Wage Center, it says.
