Trump's new visa fees spur offshoring talks, hiring turmoil

https://www.reuters.com/sustainability/sustainable-finance-reporting/silicon-valley-hiring-turmoil-after-new-h-1b-visa-fees-move-spurs-offshoring-2025-09-23/

by alephnerd • 10 months ago

65 91 10 months ago

reuters.com

alephnerd14• 10 months ago

The visa previously cost employers only a few thousand dollars. But the new $100,000 fee would flip the equation, making hiring talent in countries like India - where wages are lower and Big Tech now builds innovation hubs instead of back offices - more attractive, experts and executives told Reuters.
"We probably have to reduce the number of H-1B visa workers we can hire," said Sam Liang, co-founder and CEO of popular artificial intelligence transcription start-up Otter. "Some companies may have to outsource some of their workforce. Hire maybe in India or other countries just to walk around this H-1B problem."

boringg3• 10 months ago

I can't imagine that any company executive thinks the solution to the new H1-B visa is going to be outsource more employees (if they are a US Based company). That would be the antithesis of this administration and I wouldn't be surprised if there weren't stiffer penalties for companies that tried to do this.

alephnerd14• 10 months ago

Well, this is the end result. $100K per filing has now given every company a metric with which to benchmark whether they should open a GCC (an offshore office with P/L and Product Roadmap responsibilities) or continue to hire a mix of citizens and foreigners domestically.

If having to file for 10 H1B visas now costs the same as the amount of FDI needed to get $10-20k per head of tax subsidies and credits across CEE and India, the math to open an office abroad just became justified for every business.

m_ke3• 10 months ago

They’re all already doing this and doing it more will go unnoticed

sylens• 10 months ago

Especially because they need to be in the same office for collaboration. Right?

algo_trader• 10 months ago

I have (in the past) hired extensively in India offshore centers.

Without the H1B hand cuffs, retention/productivity in India will be doubly chaotic.

As messy as this is, some US companies may consider to make the effort to attempt to hire more in the US.

EDIT: added retention

alephnerd14• 10 months ago

There is still a fairly large Indian American 1st and 1.5 gen diaspora with GCs and citizenship.

In most cases, we have those people manage relations with offshore teams in India.

So, just like how Chinese Americans became overrepresented in hardware and supply chain management roles in order to help manage a company's "China" story, the same thing is happening for "white collar" industries.

thephyber3• 10 months ago

The first HN thread on the H1-B $100k fee pointed out that the $100k fee can be waived by the secretary (not sure which department). Most likely, H1-Bs won’t go away, they will just be bribe bait for the administration. Smaller companies who can’t lobby the admin or who aren’t in the good graces of the administration will have to do without H1-Bs, but all those tech titans who donated to the Trump Inauguration will magically get waivers for the fee.

It won’t be a matter of “outsource to India or hire locally”, it will be “what is the ROI of the bribe compared to having to hire locally when the labor market gets tighter?”

JCM94• 10 months ago

The roles sent to India are those that will soon be replaced by AI. For years US companies have treated India like an API to do menial tasks that we’re hard to automate. It made no sense for that do be done by American workers. Now probably 80% of that work can be replaced by AI in the next few years.

For a while the US outsourced a lot of call centers India, but that quickly became a stereotype for terrible cost cutting measures. The customer experience was horrible. Most of these have now been onshored or placed in locations with better performance for the American market, like Ireland, Canada, Costa Rica, or a lot of WFH folks in the US.

fancyfredbot• 10 months ago

How kind of Trump to solve the brain drain problems which have affected so many of America's peers and/or rivals.

It'll be easier to hire now that they don't have to compete with US salaries.

Even better there are a lot of US scientists looking for a job since the multi billion dollar funding cuts for cancer research. Perhaps they can also help everyone else out.

It's still America first, he's just using zero based indexing and everyone else is in position 0.

kozikow• 10 months ago

The H-1B program was already broken by the lottery. This new fee just solidifies the L-1 visa as the real high-skilled pipeline. More L-1 visas are already approved annually than new H-1Bs, and this policy only widens that gap.

In addition to L1, O1 is also often gamed. $100K for H1B is mostly "posturing" at this point, as voters don't know about other options.

alephnerd14• 10 months ago

L-1 has been broken for decades as well. The same problems that impact an H1B impact an L1 as well.

The only way abuse of both visas can stop is if they are not tied to an employer, allowing free movement of labor. Thus, if someone is talented and at TCS then they can either demand a salary equal to their skill or go to an employer who can offer that salary.

Additonally, federal, state, and local governments need to start playing the subsidy game that Poland, Romania, Czechia, India, Israel, and other companies play to attract offshore offices.

H1B is mostly "posturing" at this point, as voters don't know about other options

I disagree. This was clearly timed to distract and overshadow the Gold and Platinum card announcement.

ivan_gammel• 10 months ago

the subsidy game that Poland, Romania, Czechia, India, Israel, and other companies play to attract offshore offices.

Do you mean US government must dramatically reduce cost of living by offering subsidized housing, investing in education, healthcare etc? When I hire, I never consider USA and nobody pays me to find skilled labor in Eastern or Central Europe. You can pay one half of American salary there and people will be put in upper middle class with such income, being able to afford a lot and living comfortable life.

shagie• 10 months ago

The only way abuse of both visas can stop is if they are not tied to an employer, allowing free movement of labor.

https://www.uscis.gov/working-in-the-united-states/temporary...

    Changing or Leaving Your H-1B Employer
    Q. What is “porting”?

    A. There are two kinds of job portability, or “porting,” available based on two different kinds of employer petitions:

    H-1B petition portability: Eligible H-1B nonimmigrants may begin working for a new employer as soon as the employer properly files a new H-1B petition (Form I-129) requesting to amend or extend H-1B status with USCIS, without waiting for the petition to be approved. More information about H-1B portability can be found on our H-1B Specialty Occupations page.

    ...

    Q. How do I leave my current employer to start working for a new employer while remaining in H-1B status?

    A. Under H-1B portability provisions, you may begin working for a new employer as soon as they properly file a non-frivolous H-1B petition on your behalf, or as of the requested start date on the petition, whichever is later. You are not required to wait for the new employer’s H-1B petition to be approved before beginning to work for the new employer, assuming certain conditions are met. For more details about H-1B portability, see our H-1B Specialty Occupations page, under “Changing Employers or Employment Terms with the Same Employer (Portability).”

---

Someone on a H-1B visa can change jobs as soon as the other employer files a form I-129 to hire them.

nicman23• 10 months ago

i do not get why hacker news is against that. it is quite a socialist policy lol

Thorrez3• 10 months ago

Hacker news is run by venture capitalists.

jacknews• 10 months ago

The next step will be to impose tariffs on code developed abroad.

Not that I agree with tariffs, but there are import taxes on physical goods and parts and so on, even when they are produced by the same company, so why not on services?

alephnerd14• 10 months ago

How do you do that without disrupting all of America?

Literal backbone cybersecurity software used by the Congress IT team is developed in Tel Aviv, let alone by every single F1000.

And we ourselves export services abroad. What's to stop the EU from passing a Digital Services Tax as a result?

thephyber3• 10 months ago

We export more services than we import, so if we start tariffing them, we are very vulnerable to reciprocal services tariffs.

But also, it’s logistically difficult to tax services because they don’t enter into the same ports of entry (eg. airports, seaports), but rather over phone or the internet. There’s no CBP agent listening in on every international phone call, identifying which type of service is being performed across the international phone system.

wyldfire• 10 months ago

Poe's law....? I honestly can't tell if you're joking.

US Customs interdiction on those ssh/https-transported "git clone" sessions you use as an importer, then. "Please first fill out CBP Form 5106 to identify yourself as an Importer and get in that line over there to get your git license."

mbac32768• 10 months ago

Ugh don't give them ideas

pzo• 10 months ago

it some way you already have with that - section 174 requires amortization of foreign software salaries for 15 years. I'm ok with that as long americans will stop crying about EU trying to tax tech companies. Trump administration completely was not taking into account service sector when applying tariffs to everyone when in fact we buying a lot of such services.

mrtksn2• 10 months ago

If there's any truth in the "phd level AI", let alone AGI narrative going on since a few years this must be no problem at all, just use AI. If that narrative isn't true then in not-so-distant future SV must run out of money to hire people for other stuff anyway as all the resources seem to be in the AI basket.

The AI thing aside, I wonder why people are not demanding actual fix on the issues, i.e. right to change employer. Sure, companies wouldn't want that but aren't the SV engineers highly paid individuals? Wouldn't they be able to collect considerable resources to lobby the politicians into it?

kasey_junk• 10 months ago

They can’t vote

mrtksn2• 10 months ago

They can pay people who are trying to make other people vote for their candidate though. Chip in a 10K per, and you a major power in US politics. Apparently there are 730K H1B holders, that's enormous demographic considering that all of them are employed people. Even at 1K per person would generate 730M budget.

thephyber3• 10 months ago

I wonder why people are not demanding actual fix on the issues

It’s yet another case of what economists call “concentrated benefits, diffuse costs”.

The companies that use H1-Bs have strong lobbying power. The average US citizen doesn’t know much about H1-B or the common criticisms. Some grievance-based US voters want to cut most/all work visas, especially H1-B. Crucially, H1-B recipients don’t vote in US elections, so the people most affected have no influence in fixing it.

The underlying problem is that Congress is defective. It used to fix problems that helped America. Now it’s only useful for launching influencer careers.

danaris4• 10 months ago

There aren't enough of them to rate that level of attention from politicians. Especially when pitted against the lobbying might of Silicon Valley, which very much wants to keep its totally-not-indentured workers.

mdemare• 10 months ago

Gentle reminder that the Netherlands has lots of very smart software engineers that prefer to stay there, especially if there were more interesting software companies active there.

usrnm3• 10 months ago

Another gentle reminder that the Netherlands has a 50% income tax (for swe salaries, at least) and a number of other non-trivial taxes like a wealth tax. I personally know people who found Dubai an interesting alternative to Amsterdam.

BoredPositron2• 10 months ago

Ah yes... Dubai. The obvious alternative for people from the Netherlands that want to stay in the Netherlands.

dns_snek• 10 months ago

No, it's 50% marginal income tax rate on income over 75k EUR. With a median SWE salary of ~85k EUR you would be taking home 55k a year, that's an effective tax rate of 35% [1]

And that's before we even start talking about what kind of life that country and salary affords you, i.e. the thing that people actually care about, and not just materialistically but also culturally.

[1] https://thetax.nl/?income=85000&startFrom=Year&selectedYear=...

danielfalbo• 10 months ago

I don't see the issue: talented individuals can get O1, and not-talented individuals are not worth hiring at startups anyway.

alephnerd14• 10 months ago

The issue is the O1A is oversubscribed because it includes "Sciences, education, business, or athletics" and in reality, the only thing needed to get an O1 through the door is a good lawyer and around $50k-60k in legal fees.

As such, an O-1 is now being used the way an L-1 should have been, an L-1 is being used the way an H1B should have been, and an H1B is used the way an OPT should have been.

Most academics, nurses, PhD students turned ML Researchers, etc will be filed on an H1B or (in the latter case OPT to H1B).

JCM94• 10 months ago

The H1B program has been abused by employers for a long time. Nobody can reasonably defend it at scale. Some fear mongering now that the party is over, but unlikely doomsday is coming for US tech.

Is this a unilateral change that will have some collateral damage? Yes.

Is this going to total ruin the US tech sector? Unlikely.

Will all these jobs just go to India directly? Almost certainly not. That option was always on the table and lots of reasons why employers aren’t sending more jobs to India, including deep structural challenges in the country that aren’t close to being solved.

Will they get offshored elsewhere? Mostly not. Maybe a bit, but those jobs were already at risk of being offshored. The H1B change won’t make a huge difference there. More likely is 15% of roles offshore, 15% were truly needed and employers pay up, 15% are just eliminated and absorbed into existing workers, and the rest stay in the US. Thats still a big net win for the United States.

What will happen? Not completely clear yet, but over time this simply raises the bar for claiming you need to import somone to do a job. India will lose the most as it puts big hurdles to folks there getting highly desirable jobs in the US. There may be some very limited movement of roles elsewhere but those will likely go to Canada, the UK, and maybe a few other places.

The administration is calling the bluff of these companies crying foul, and very likely these companies will cave. Expect to see anyone that does actually try to move things abroad to simply be slapped with tariffs that make such moves unprofitable. These companies value access to the US market much more than employing a few H1Bs.

Not saying I agree with everything happening, but the idea that this was some poorly researched jerk reaction dangerously underestimates the playbook being used here. The administration knows exactly what they’re doing.

HankStallone2• 10 months ago

Yeah, offshoring has been going on for three decades. What could be profitably offshored has been, and then some, because some executives just like the idea a lot. There are reasons that companies have been abusing guest worker visas and clamoring for more, instead of offshoring those jobs. This may cause a bit more offshoring at the margins, but not a massive change. The fear-mongering is propaganda.

KaiserPro• 10 months ago

Nobody can reasonably defend it at scale

I mean its perfectly defendable, its a way of depriving the rest of the world of highly skilled, motivated people.

As we've seen several times before, all it takes to turn a country into a backwater is brain drain. Vienna was _literally_ the centre of arts, culture and commerce, until it wasn't.

These companies value access to the US market much more than employing a few H1Bs.

I think thats the point, its going to be used as a tool of favour/coercion. "good companies" will get h1bs, "bad companies" will not.

JCM94• 10 months ago

There are lots of other pathways to do this outside the H1B. The US doesn’t need H1Bs to suck brain drain from elsewhere.

Simulacra• 10 months ago

My only complaint with the entire H1B process is that it is used to simply hire cheaper labor, rather than the best, often at the expense of Americans. It's essentially importing a cheaper work force to displace the local one. That's the unfair economic impact because Americans cannot compete.

Just ask anyone who had to train their H1B replacement to get severance.

Those who support H1B should start talking to those who feel displaced, replaced, and cheated. Any one of us could be replaced or off shored.

notmyjob9• 10 months ago

It’s not just cheaper. Think of the several extremely costly lawsuits filed against Tesla for racial discrimination over the years. You know who won’t sue a racist and sbusive employer? An H1b. While local nurses at Kaiser picket, Kaiser claims they need more h1b nurses because of a shortage, while offloading doctor work onto those nurses. You know who won’t go on strike for being overworked and doing the work of actual physicians? Yes, imported workers.

notmyjob9• 10 months ago

And the critical thing to notice, 16k per year, what this at best half measure from the administration does, is not enough of a cost to offset that benefit. Not being able to sue Tesla for millions of dollars for racism is well worth a measly 100k over 6 years. Calling it a half measure is even being way too kind. It was a psyop on labor. A fake solution that won’t do anything to solve the very real problem of h1b abuse.

jgbuddy• 10 months ago

Entry level tech positions are really in turmoil, not silicon valley hiring.

notmyjob9• 10 months ago

Reuters has zero credibility at this point. Shameful.

1970-01-012• 10 months ago

Their reputation is outstanding: https://ground.news/interest/reuters_fa2539

Care to share how and why you have this opinion?

notmyjob9• 10 months ago

It’s based on a steady stream of bs they crank out, like the featured article. Oh the poor venture capitalists and other exploiters of labor, how will they ever survive this catastrophic 5% increase on the cost of Coolie labor.

aga98mtl• 10 months ago

I would pivot H-1B teams to Canadian offices if I were big tech.

bottlepalm3• 10 months ago

No, mention of OPT in this thread so here it goes. I’m directly observing OPT candidates crowding out American workers from getting jobs.

Foreign students pay large sums of money for advanced American STEM degrees and then flood the market for the same jobs American tech workers are trying to get. Americans in debt from undergrad degrees that foreign nationals were able to obtain a lot cheaper.

The ratios I’m seeing are insane, like 90% OPT candidates. You can’t discriminate against them, have advanced degrees and accept lower salaries and out number domestic applicants - so we reluctantly hire them. Even though their technical communication and English skills are abysmal.

Thorrez3• 10 months ago

If someone's communication skills are bad, it's legal to not hire them. That's a job-relevant characteristic. Of course you have to apply that job requirement to all candidates, not just OPT candidates.

bottlepalm3• 10 months ago

I think their conversation skills are fine talking with recruiters and HR, simple stuff. But in the tech interview it takes 5x longer to communicate and even then it’s still not very good. Going back to interviewing a native English speaker feels like a turbo boost. Unfortunately trying to explain this to HR opens you up to being accused of racism, so it’s not worth it.

Also you got to think HR has incentive to let it slide to get those cheap workers. It’s sad hearing them talk salary expectations of terrible candidates knowing they’re going to be hired because they want 20k less or whatever.

I’m just sorry for the people the candidate will be working with and the company itself because it’s a net negative for them.

Gud2• 10 months ago

Generally verbal fluency in a language goes up quickly if you are able to read and write well in that language.

I don’t think you’re making a very strong argument.

Full disclosure, I read a lot in English but almost never spoke it. 6 years ago I started working internationally and my spoken English has improved enormously.

I have observed the same with my colleagues. The man who recruited me, an older German, could barely make himself understood in English.

A couple of years later, he sounds American.

hollerith• 10 months ago

He sounds American to you, but does he sound American to an American?

JCM94• 10 months ago

The cold truth is some companies simply like H1Bs since it’s a form of indentured servitude. There are plenty of US tech workers to fill most roles. Probably only ~10% of roles with an H1B would meet the bar for being unable to find a qualified US worker.

It’s no coincidence that Amazon has more than double the number of H1Bs in corporate tech roles than the next biggest user. They’re not exactly broadly known for being a great place to work in tech. However, with H1Bs Amazon has a lot more power over making tech workers tolerate stupid stuff that makes these jobs much less attractive to top-tier US tech talent with more mobility.

slowmovintarget• 10 months ago

Yes, and for software, remote work actually... works. Have a few in-person meetups in a year, but most of the day-to-day is git, Slack, and Zoom (or equivalent).

alephnerd14• 10 months ago

If I can hire someone remotely in San Antonio, why can't I hire someone remotely in São Paulo as a result?

This is why the offshoring boom happened since COVID - remote-first proved that async works well enough, which made offshoring more enticing.

Now that sponsoring 10 H1B visas is guaranteed to cost $1M, I may as well spend that much to open an office abroad, get 7 figure tax credits per employee, and pay a lower salary.

scoop293• 10 months ago

If you think about this fee like "tariffs for service workers" then it's easier to infer its impact. Tariff distorts prices. That might be a good thing or not. Monopolies and dominant big tech will be able to absorb this cost better -- they already have huge legal departments and HR, and can pay for the cost as long as they can accelerated things with fees. startups, smaller players and universities will be less likely to be able to afford that. You already see this in H1B market, just to a less extent. More STEM immigrants could move to tech/finance (not that it's not already this case) because that's already the only place any H1B job can be found. You're not going to find a small brewery job recruiting H1B.

Another possibility is this cost gets shared with the workers who are desperate to get a job and supresses real H1B wages even more-- it's already quota controlled. Hey, what are you going to do if you don't get a raise, give up on your life in this country or pay 100k to move?

As always, the best way of protect labor is better regulations and maybe unions.

1970-01-012• 10 months ago

This is a win for common sense. At first the H1Bs were justifiable, but over time the hack became a staple for squeezing out local hires for bottom dollar contenders. Of course it was executed extremely poorly and with confusion. That's standard procedure for this administration.

_DeadFred_• 10 months ago

People on H1Bs, I can't imagine how scary it all is. I'm disgusted you are going through this. I don't think I have ever worked with an H1B co-worker that I didn't want as a permanent fellow american. I may have been frustrated when their skills weren't where they should have been, but that again was on the companies gaming the system. On the personal level I never once worked with someone I wouldn't have been thrilled to be my friend/neighbor/inlaws. We aren't upset you are here. We are frustrated at how companies are using this system. I know that sort of semantics don't matter when it's your actual LIFE being torn up/risked/threatened.

I have been critical of H1B on here. I think it has been abused by companies and hurt American workers. But I also think we should allow more just plain old immigration (that doesn't give companies crazy leverage over workers).

I think people currently under the program should be exempted. You can't invite people into your home, then after they build their lives around that alter the deal. That's incredibly fucked up. Especially when it's kind people excited to come live in your house with you.

My first responses on here when this happened was 'about time'. And then I saw frantic people posting and my heart broke and I felt sick I had posted that.

Trump's new visa fees spur offshoring talks, hiring turmoil

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