Impact of Trump Administration Immigration Initiatives on Tech Industry

August, 2019


Immigration was a core issue for Donald Trump during his 2016 campaign for the US Presidency. He promised to change the US immigration system with the stated aims of protecting US workers from foreign competition, defending against potential foreign threats to the US homeland, and addressing perceived issues with the assimilation of certain groups of foreigners. Through his many pronouncements on the issue, the one clear message was that Trump would look for ways to make fundamental changes to scrutinize, restrict or limit immigration, whether it be for travel/tourism, study, work or permanent residence and a path to citizenship.

In Avasant’s view, the Trump Administration’s proposed changes to work visa programs and travel entry rules will have a marked impact on the technology services industry. With respect to work visa programs, especially the H1-B visa, the Trump Administration initiatives will slow down but not completely stop the influx of foreign technology workers into the US to meet demand. The US has become skeptical of the H1-B program with respect to its use by IT outsourcing companies, but remains supportive of using it to recruit highly skilled positions requiring advanced degrees. The direction of the Administration’s Executive Orders and proposed immigration legislation in the US Congress suggest that reform of the H1-B program will likely involve the following: (1) increases to minimum salary thresholds; (2) changes to the visa allocation model to favor small business start-ups, advanced degree holders, and foreigners studying in US universities; and (3) improvements in auditing and enforcement of visa rules among US based companies.

With respect to travel, the Trump Administration has made a number of different attempts to restrict entry into the US of foreigners from various countries in the Middle East. Despite setbacks in the courts on constitutional grounds, the Administration has continued to explore ways to impose travel restrictions, including a directive banning the use of certain devices larger than a mobile phone on certain flights emanating from various airports in the Middle East.

During the first few months of the new Administration, there have been many attempted changes, and other plans are reportedly in the works, that would fundamentally alter US immigration policy. The global technology services industry has been looking carefully, if not warily, at the changes, and what it means to the way that technology companies that are US-based or serve US customers recruit and hire global talent for a globalized industry.

There are three (3) primary areas where the Trump administration may impact the Technology Sector as it relates to immigration:

  • Changes to Work Visa Programs
  • Freedom to Travel to the US
  • Changing Climate Towards Foreigners & Chilling Effects

Taken together, the proposed or contemplated visa program changes, travel restrictions and the general change in climate will likely slow down, but not stop, the H1-B program or the influx of higher-skilled foreign workers into the US over the next few years. As companies deal with labor shortages and skills gaps, there will be an acceleration of trends already present in the marketplace towards automation, transformation, and offshoring. In addition, one should expect an increase in rebadging, local hiring, training, and strategic partnerships within the US to address the need to supply locally based staff.

The purpose of this article is to provide a brief analysis of the Trump Administration’s initiatives to change certain aspects of US immigration policy, and the potential impact to the global technology services industry. Avasant has also outlined some potential adjustments by the global technology services industry in response to US policy changes.