Patrick Boyle makes a case that's been surprisingly absent from the immigration debate: the H1B visa program has been the backbone of America's tech industry, and a new fee could collapse it. The piece examines Trump's recent executive order charging companies $100,000 per new H1B application, unpacking what this means for employers, universities, and the future of American innovation.
The New Fee
President Trump signed an executive order last week that would charge companies $100,000 for each new H1B visa application. The announcement triggered panic among foreign workers and confusion among employers. Commerce Secretary Howard Lutnik told reporters it was an annual charge, requiring companies to decide whether a foreign worker was worth $100,000 per year plus salary. The White House then scrambled to clarify: the fee is one-time, applies only to new applications not renewals, and current visa holders won't be charged to re-enter.
The irony of this announcement is striking. During his 2020 campaign, Trump praised the H1B program as a great thing he had always supported. Less than a year ago, he told a podcast that graduates should get a green card with their diploma. Now he's proposing a fee that would effectively end the H-1B visa category by making it prohibitive for most businesses to hire foreign workers.
How the Visa Works
The H-1B visa was created in 1990 as a way for US employers to hire foreign workers in specialty occupations requiring specific technical expertise. It quickly became the primary visa for companies filling roles in software engineering, data science, biotech, and other fields where domestic labor supply falls short.
Each year, the government issues 85,000 new H1B visas. 65,000 go to applicants with bachelor's degrees and 20,000 to those with US graduate degrees. Demand is so high that the entire allotment gets claimed within 24 hours of the application window opening. The government then runs a lottery to decide who receives a visa.
The lottery system means a foreign graduate with rare and critical skills has the same odds as someone with more common qualifications. Critics might note this doesn't actually prioritize the most valuable workers.
The visa lasts for three years and can be extended to six. Workers must then leave or transition to a green card. There's a per-country cap on green cards—no country can receive more than 7% of available green cards. This creates extremely long wait times for workers from high-population countries like China and India.
After getting an H-1B, workers are tied to their employer. If they lose their job, they have 60 days to find another or face deportation. Many Chinese and Indian workers find themselves stuck on temporary visas building lives in America, knowing that losing their job could quickly lead to expulsion.
The Legal Question
Immigration experts have pointed out that visa fees are governed by the Immigration and Nationality Act, which lays out specific rules for how fees can be assessed. The law allows cost recovery—meaning the government can charge a fee to cover processing expenses—but it doesn't authorize punitive pricing. This fee goes far beyond what it costs to review an H-1B petition.
TheKO Institute has warned that while the fee may lack clear statutory basis, courts could still uphold it. Immigration law gives the executive branch wide latitude, and past challenges to presidential proclamations have had mixed results. In 2020, Trump tried to suspend entry for certain visa categories during the pandemic. That move was blocked in court, but other restrictions survived.
If the fee is challenged—and most observers expect it will be—the case could hinge on whether it's framed as a national security measure, labor market protection, or a revenue tool. The administration has been vague on this point.
Impact on Employers
The visa has been heavily used by tech firms. In 2022, Amazon was the top H1B sponsor, followed by Tata Consultancy Services, Google, Microsoft, and Infosys. These workers tend to be young, highly educated, and willing to relocate. Many stay in America and become permanent residents, start companies, or take leadership roles in US firms.
Four of the seven most valuable public companies in America—Google, Microsoft, Tesla, and Nvidia—are led by former H-1B visa holders. So are the CEOs of four of the most valuable private companies.
Supporters of the program often cite a study claiming each foreign worker hired on an H-1B leads to five additional jobs for Americans. The logic is that skilled workers boost productivity, help companies grow, and allow firms to expand domestic operations. But critics argue the visa can suppress wages. A 2023 analysis found that 60% of H-1B jobs were paid below the median wage for the occupation.
The nature of the program is that it can both create jobs when bringing in highly skilled workers that help US firms innovate and grow, or it could suppress wages depending on how it's used.
Impact on Universities
For decades, US universities have attracted top students from around the world. The draw wasn't just education quality—it was the possibility of staying on after graduation, working in America, and eventually settling down. The H-1B became a bridge between study and citizenship.
International students pay high tuition fees, often two or three times what domestic students pay. Many come from India and China where the cost of US degrees represents a major financial commitment. The belief was that a degree from a US university would lead to a job at a top US firm.
If the cost of hiring a foreign graduate rises to $100,000 plus salary, many employers will simply stop doing it. That means fewer job offers for international students and less incentive to study in America. American universities could see a drop in applications, especially in STEM fields where foreign students make up a large share of the graduate population.
International students subsidize the system by paying higher fees. They bring diversity, research capacity, and global connections. If they stop coming, effects will be felt across departments—not just engineering labs but economic seminars, business schools, and medical research centers.
The Competitive Risk
During Trump's first term, visa processing slowed, denial rates rose, and scrutiny increased. Firms responded by moving jobs offshore. Instead of bringing workers into America, they built teams in Canada, Mexico, India, and Eastern Europe. This new fee could accelerate that shift.
Remote work technology has made doing this so much easier. A software engineer in Bangalore can work for a US company without ever setting foot in America. The same goes for data analysts in Warsaw, biotech researchers in Singapore, and cybersecurity experts in Toronto. The pandemic normalized distributed teams. The visa fee gives companies another reason to keep them that way.
If US firms cannot hire the talent they need, they risk falling behind. And if talent goes elsewhere—to countries with more welcoming immigration policies—the innovation goes with it.
If the cost of hiring a foreign graduate rises to $100,000 plus salary, many employers will simply stop doing it.
A counterargument worth considering: some studies suggest America has enough STEM graduates to meet demand. What is clear is that many STEM graduates in the US end up working in unrelated fields. According to one report, only about a quarter of Americans with STEM degrees actually work in STEM jobs. That doesn't necessarily mean there's a surplus—it could mean the jobs aren't attractive enough or employers prefer foreign workers who are more mobile and less expensive.
Bottom Line
The strongest part of this argument is that the H1B visa has been a cornerstone of America's skilled immigration system, helping maintain US leadership in science, technology, and innovation. More than 20% of American Nobel Prize winners were immigrants. The biggest vulnerability is that legal challenges could invalidate the fee entirely—or courts might uphold it, leaving companies to simply absorb the cost or shift operations overseas. Either way, the talent pipeline that built America's tech industry is now at risk. Companies are already responding by hiring abroad instead of bringing workers into the US. That shift may have just accelerated.