Trump’s H-1B Reforms and What They Mean for Tech Companies

The Trump Administration has recently released new and stricter rules for the release of H-1B visas, demanding a more detailed documentation about H-1B workers to ensure that the non-immigrant visa is not abused.

Due to the reform, H-1B US visa applications will now require details on exactly what the workers will do, why they’re needed, and where they will work.

The H-1B visa allows US companies to bring in workers for specialised jobs that require theoretical or technical expertise, such as those in the field of IT, engineering, science, medicine, finance, accounting, and the like. These fields are identified to have a possible shortage of skilled local employees.

The reforms are made in part of the “America First” campaign promise made by Trump. With the reforms, H-1B visa application is more rigorous, ensuring that only the most-skilled or the highest-paid applicants are granted H-1B visas. The result? It's more difficult, discouraging even, to apply for the visa and bring in talent from abroad.

The US Department of Labor shares that the top jobs seeking Labour Condition Applicationthe first step in filing for an H-1B visaare software developers or programmers, computer system analysts, and “computer jobs-other”. Records also show that tech giants Apple, Microsoft and Cognizant Technology Solutions file the highest number of LCA applications. With the new restrictions in the visa application, tech companies are predicted to take the biggest hit.

In principle, Trump has a point in restricting the grant and use of H-1B visas. With a lower number of overseas workers, the jobs will go to American workers. However, this hypothesis is very much flawed: the supply of homegrown trained talent is too low to accommodate the big demand for tech workers. Eventually, tech companies who fail to acquire the talent they need will fail to grow and thrive.

Immigration experts have studied how the visa reform can possibly affect industries and companies which are heavily reliant on H-1B workers. Immigration attorney Tahmina Watson says:

“These companies, if they have this choke hold, they’ll ultimately look to other countries to set their businesses up there. These smaller businesses will find a way to have their businesses parked in a different country because they can then hire the talent they need.”

What does this mean for US tech companies? 

With the U.S. housing the biggest tech hubs in the world, Trump’s visa reforms can prove to be a big hurdle for tech companies, especially for those who have long been dependent on overseas talent. Tech companies and firms are now bracing for changes and the after-effects of Trumps’ reform policy.

Adapting to the situation and finding a smart hiring alternative is the key to staying in the competition. 

As the entryway to bring in foreign talent is quickly narrowing, companies can look further afield and build an offshore development team in countries with a wide pool of qualified talent. Countries like the Philippines provide US tech companies with a strategic offshoring opportunity because of their constantly growing talent pool: the country produces over 500,000 tertiary graduates and over 130,000 STEM students each year.

US companies and tech firms now have a solution to the looming problem in hiring tech talent. Western-managed and competent offshoring companies in the Philippines can help these companies find the right worker for their needs without having to undergo the tedious and restrictive visa application process. With an offshore development team working with the in-house team, costs are reduced and the overall productivity is increased.

As in all outsourcing and offshoring ventures, of course, the key is to find a reliable offshoring partner whose expertise and business model answer the specific needs of tech companies and businesses and those which have proven to deliver quality services.  


Struggling to hire the tech talent you need? Cloud Employee helps you find the developer of your choice through zero-risk trials. You can hire dedicated offshore developers with us across many technologies. Talk to us, learn more how Cloud Employee works, or see our Developer Pricing Guide.

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