President Trump will sign an executive order on Tuesday that aims to overhaul the H1-B visa program used by tech companies to bring high-skilled workers to the U.S., directing a government-wide review aimed at putting new teeth back into decades-old “Buy American” and “Hire American” directives.
As The Hill reports, Trump will travel to a manufacturing plant in Kenosha, Wis., to sign the order, which the administration says will make it more difficult for U.S. companies to look overseas for workers to fill middle-income jobs.
At a background briefing with reporters, senior administration officials described the current H1-B visa program as a lottery system that indiscriminately hands out work visas to contracting firms that recruit low-skilled, low-wage workers to replace working-class domestic laborers.
They say a new system is needed to ensure that the program returns to its original purpose of bringing in high-skilled, high-paid workers to fill more specialized or technical roles.
As we've pointed out before, large Indian consulting firms are by far the largest users of the H-1B visa program. That said, most of the jobs created by those companies tend to have lower salaries than those created by the likes of Microsoft, Google and Facebook.
Tech industry insiders expect Trump will direct DHS, which runs the H-1B visa lottery system, to start a rule-making to re-prioritize the visa allocation to give preference to higher-paying firms. This pits tech firms against the Indian IT-staffing firms.
In theory, prioritizing by salaries means visas for more senior, higher-paying jobs will be granted first, and visas for lower-paying jobs (such as those being filled by Indian IT services firms) would fall to the back of line, perhaps not getting allocated at all if demand for the high-wage job visas is strong.
California House members Darrell Issa, a Republican, and Zoe Lofgren, a Democrat, are pushing bills that would raise salary requirements for H-1B visa holders. Tech companies generally support those efforts to de-prioritize Indian outsourcers that they claim "clog up" the oversubscribed lottery system with bulk applications.
In line with his campaign promises...
— Donald J. Trump (@realDonaldTrump) March 4, 2016
The Wall Street Journal reports, the executive orders will initiate a 220-day review process, which could lead to additional executive orders and possibly legislation, will focus on preventing foreign workers with H-1B visas from, as one senior administration official put it, “undercutting American labor at less cost,” which the official labeled as “an abuse” of the current system.
“This is a clear statement from the president of the United States to shore up some of these abuses,” the official continued. The goal, the official said, is ensuring that “everyone can have a realistic path to economic success and full employment.”
The order will call for a review by federal agencies aimed at stricter enforcement of immigration and other laws governing the entry of workers into the U.S.
In addition to the visa program, federal agencies will be asked to review and minimize the use of waivers and exceptions to Buy American policies as well as assess the degree to which waivers included in free-trade agreements have hurt American workers. If those waivers, which are part of trade agreements with nearly 60 countries, are deemed to have put the U.S. at a disadvantage, as administration officials believe to be the case, those deals are likely to be renegotiated, the official said. The order also will demand the use of American-made steel in publicly financed infrastructure and other construction projects. It clarifies that steel slab imported from and primarily constructed in foreign countries but finished in the U.S. won’t meet that directive.
“This ensures that the benefits of Buy American are felt throughout the supply chain,” another senior administration official said on Monday.
“There will be an immediate culture change across these agencies,” a senior administration official said. “Buying American is the Trump administration’s highest priority for taxpayer dollars. Agencies will have their marching orders and will be held accountable for failure.”