Local tech leader eyes fallout from Trump immigration moves
- Author: Ronnie Bowen Feb 02, 2017,
Feb 02, 2017, 0:41
That is worrying news to Indians like Prachi Dighe, 26, a software developer in Pune at Tata Consultancy Services, the biggest user of the H-1B program. Mphasis, NIIT, Geometric, Mindtree and KPIT Technologies as well as stocks of mid-cap IT companies also dropped to nearly 4%.
Earlier, on January 4, two Republicans from California, Darrell Issa and Scott Peters, had tabled a Bill called the Protect and Grow American Jobs Act in the US Congress to raise wages for high skill jobs in the US to $100,000 per year from $60,000 and to make Master's degrees mandatory to qualify to work with H1B visas in the US.The Bills are basically meant to prevent companies from using low-priced foreign workers to do high-skilled jobs in the US. 90% of Indian technology workers use H1B visas. He said his company was planning to apply for an H-1B visa on his behalf in April. It sets aside 20 percent of the annually allocated H-1B visas for small companies and startup employers (50 or fewer employers) to ensure small businesses have an opportunity to compete for high-skilled workers.
It would also establish wage requirements for L-1 workers and improve H-1B wage requirements to encourage companies to hire qualified American workers and prevent them from using foreign workers as a source of cheap labour.
Indian outsourcing companies deliver services ranging from software coding to running business processes for customers in the U.S., Europe and other countries by taking advantage of low-priced, highly-skilled staff on their home turf. The draft aims to reverse the Optional Practical Training (OPT) extension for STEM (science, technology, engineering and mathematics) students that the earlier administration had proposed in late 2015. This would mean that the tech companies which hire foreign nationals at lower salaries, including a huge number from India, will prefer American nationals thereby creating jobs for United States citizens.
Globally engaged America is still coming to grips with the Trump decree staunching refugees and travel from se ven Muslim nations when it was revealed that a new presidential order, aimed at overhauling the guest worker programme that includes the H-1B visas, is in the works.
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The bill, likely to be signed by President Donald Trump, would make it hard for firms to use the programme to replace American employees with foreign workers, including from India, with lower wages.
US President Donald Trump is expected to issue an executive order to restrict work visas, H1B and L1 issued to professionals working in the US for a short period of time, as part of a larger immigration reform.
Ministry of External Affairs has said India's interests and concerns on the issue have been conveyed both to the US administration and the US Congress at senior levels. He said that according to data available, Indian IT companies have created 4.11 lakh jobs in the USA of which 1.5 lakh are direct employment. "The viability of the offshoring model of Indian software firms would be at risk", she said. Its business in the USA, where it provides engineering and other tech services to firms such as IBM, Microsoft and Citibank, is highly dependent on the H-1B visa. In 2016, Infosys filed 25,405 Labor Condition Applications (LCA) for H-1B Visa in fiscal year 2016 (see table below). The average salary of those job offers was $81,705. Besides job creation, Indian IT industry has also contributed to the USA economy in terms of tax payment, social security outgo and CSR activities. She cites World Bank data records that put U.S. as the second largest source of remittance - worth $10.96 billion - to India in 2015.
According to him, the Bill contains provisions that may prove challenging for the Indian IT sector and will also leave loopholes that will nullify the objective of saving American jobs.
Amid the chaos and plummeting stock of IT companies, India conveyed its concerns to the U.S. over a bill being introduced in the Congress to change rules on H-1B visas which is likely to impact its IT industry and Indian techies working in the US.