H-1B Cap Applications Drop for Second Consecutive Year

Filings fall by 4 percent, demand still strong

Roy Maurer By Roy Maurer April 27, 2018
H-1B Cap Applications Drop for Second Consecutive Year

​H-1B visa petitions filed under the annual cap have fallen for the second year in a row, to 190,098 after reaching a record-high of 236,000 in 2016.  

U.S. Citizenship and Immigration Services (USCIS) reported that the petitions received this year for fiscal year (FY) 2019 dipped four percent from the 199,000 applications received in 2017.

The visa, which allows U.S. employers to hire skilled foreign workers, is mostly used by technology companies, and despite the falling numbers, demand continues to far outpace supply.

Of the 190,098 petitions filed for workers this year, 95,885 were submitted toward the cap exemption of 20,000 for holders of U.S. advanced degrees, and 94,213 were submitted toward the standard quota of 65,000 H-1B visas. That gives petitioners a 21 percent chance of selection in the advanced-degree lottery and a 38 percent chance of selection in the standard lottery for all remaining cases.

"Random allocation of a limited number of visas does not allow employers to efficiently recruit, hire, transfer and retain a global workforce, and we risk falling behind our global competitors," said Mike Aitken, vice president of government affairs of the Society for Human Resource Management (SHRM). "H-1B visas are one important piece of addressing the skills gap, along with focusing resources to train and educate Americans."

SHRM found that 68 percent of its members report difficulty recruiting candidates for full-time positions, with science, technology, engineering and math positions being the most difficult high-skilled positions to fill. 

[SHRM members-only online discussion platform: SHRM Connect]

Reasons for the Decline

Reasons for the decline are attributed to changes in tech-sector staffing, as well as to President Donald Trump's Buy American, Hire American executive order, which has led to a variety of stricter petition-vetting measures at USCIS. Scrutiny of cap-subject H-1B petitions—especially of job duties, worker qualifications and wages—has increased since the executive order took effect last spring.

Through August 2017, USCIS issued more than 85,000 additional requests for evidence for H-1B petitions overall, an increase of 45 percent over the previous year. The additional requirements could serve as a deterrent for companies and workers.

A new study using USCIS data from 2017 by the National Foundation for American Policy (NFAP), a nonprofit public-policy research organization based in Arlington, Va., shows that several of the largest India-based IT outsourcing companies—typically the biggest users of the H-1B—are seeking fewer visas. Five of the seven top-ranked India-based firms saw declines last year. For example, the number of new H-1B petitions for Infosys, Tata Consultancy Services and Wipro declined by more than 50 percent from 2016.

[Do you need to learn more about employment-related immigration? Looking for some recertification credits for your HR credential? See these SHRM eLearning courses on how to manage immigration in your workplace. Many SHRM eLearning programs offer professional development credits (PDCs) for SHRM-CP and SHRM-SCP credentials.]

The NFAP concluded that the decline in H-1B visas for India-based companies is due to industry trends toward digital services such as cloud computing and artificial intelligence, which require fewer workers, and a choice by companies to rely less on visas and to begin hiring U.S. workers and building U.S.-based technology hubs.

"Also, like all companies, including U.S. companies, restrictions on visas may result in more work being performed outside the United States, which is the unintended consequence of many immigration restrictions in a global economy," the NFAP said.

U.S. Gains

U.S. technology companies obtained more H-1B visas in last year's lottery than the previous year, according to the NFAP report, with four high-profile firms—Amazon (2,515), Microsoft (1,479), Intel (1,230) and Google (1,213)—placing among the top 10 employers for approved H-1B petitions for initial employment. Facebook (720) and Apple (673) were 14th and 15th on the list. Amazon had the second-highest number of H-1B petitions approved for FY 2018, after Cognizant, a U.S. multinational IT services outsourcing company that typically sits atop the list of companies receiving the most H-1B visas.

Another interesting finding from the report was that foreign students account for 81 percent of the full-time graduate students at U.S. universities in electrical engineering and 79 percent in computer science, which could be a contributing factor to the high number of H-1Bs used by U.S. tech companies.

"We need a modern immigration system that reflects market demand, protects U.S. workers, and prioritizes visas for employers who invest in the U.S. workforce," said Lynn Shotwell, executive director of the Council for Global Immigration, an affiliate of SHRM. "Predictability is important for employers to remain competitive and innovative in our global economy," she said. "It's a key element that our current employment-based immigration system is lacking."

More Restrictions Coming

According to plans referenced in an April 4 letter written by USCIS director L. Francis Cissna, the administration is not done with its efforts to further curb the program. Cissna said the agency will propose to revise the definition of "specialty occupation" in order to "increase focus on obtaining the best and the brightest foreign nationals via the H-1B program, and to revise the definition of employment and employer-employee relationship to better protect U.S. workers and wages." This may effectively end the practice of contracting H-1B workers through staffing firms.

The proposal would also raise wages for H-1B workers.

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