American businesses can move jobs abroad

More than a month after its announcement, the new US policy on H-1B visas continues to spark controversy, especially in the global technology industry. The $100,000 fee that President Donald Trump has imposed on each new H-1B application could force many American businesses to move their workforce overseas instead of hiring locally.

According to experts, this new fee structure is intended to curb the phenomenon of foreigners "taking jobs from Americans" by only allowing truly exceptional and irreplaceable personnel to remain. However, the policy is backfiring, as many American corporations are considering moving jobs to global hubs in Europe or India – where costs are lower and highly skilled labor is readily available.

Indian MP Shashi Tharoor stated: "The biggest challenge will come for Indian businesses that are fulfilling contracts for American partners. Having to pay an additional $100,000 per employee sent over will make these contracts financially unviable. Many companies may be forced to cancel or renegotiate, disrupting the technology supply chain between the two countries."

This visa policy would hinder the recruitment of Indian technology engineers to work in the US for salaries of around $60,000 per year. Meanwhile, American workers are unwilling to take on the same jobs unless they are paid at least $85,000 or $90,000 per year. The $100,000 fee would make entry-level engineering positions unattainable, retaining only those in the high-level group – those who are truly irreplaceable. I'm not sure if it can work effectively in practice, as it significantly impacts the labor market and harms both the US and its partner countries.

First, for many companies, the obvious solution is outsourcing – meaning that work that was previously done in the US can now be transferred to the corporation's branches in Europe, such as Germany, the UK, Ireland, France, or in many cases, to global capacity centers in India. This means that, in effect, Indian engineers are doing the same work, earning the same income, but instead of being in the US, they are working right here in India.

According to US government data, India accounted for 71% of all H-1B visas issued last year, while China came in second with nearly 12%. Following the announcement, Indian technology stocks lost approximately $10 billion in market capitalization in a single day – reflecting concerns that the US visa policy could cause a reverse outflow of highly skilled technology talent from the US, instead of attracting it as originally intended.

Source: https://vtv.vn/doanh-nghiep-my-co-the-chuyen-viec-ra-nuoc-ngoai-100251022060916137.htm