A proposed H-1B visa fee increase threatens to kneecap Silicon Valley's ability to hire the foreign talent it needs to compete

Hiring skilled workers on H-1B visas is already hard enough for U.S. tech companies. A proposed fee hike could make it even worse.

• The tech industry relies on skilled-work visas for foreign hires in a system critics say is broken.
• Now the USCIS is proposing fee hikes for visa applications, at a time when it's already challenging.
• It would be another hurdle on top of recent tech layoffs and scarce visa availability, experts say.

Strict rules around the system for H-1B visas — which the tech industry relies on to hire skilled foreign workers to fill critical roles in fields like engineering and data science — already stymie the American tech industry's ability to remain competitive on the global stage, especially amid the recent wave of layoffs.

Now, US Citizenship and Immigration Services plans to hike the fees that companies have to pay to sponsor those visas by as much as $600 an applicant. It would be the first such fee increase since 2016, but experts and industry insiders say that the timing couldn't be worse, likening the situation to pouring gasoline on a burning fire.

"We are already operating in an environment where there are very, very few jobs. We're already existing in an environment where jobs are at risk," Hiba Mona Anver, an immigration attorney at Erickson Immigration Group, said. "We are really hoping that things will start to get better, but this sort of increase in filing fees is only going to be another step in discouraging companies from sponsoring foreign talent."

While the proposed fee hikes are presented as a solution to end backlogs and address bureaucratic headaches, experts say they would make it more difficult to hire foreign talent. That would especially affect smaller companies, universities, and startups, which would, in turn, undermine Silicon Valley's innovation pipeline.

The proposal is in the middle of a 60-day comment period for people to officially weigh in on the idea. Immigration lawyers are encouraging their corporate clients to submit comments about how this would hurt their ability to hire people on these skilled-work visas. 

"Businesses are getting back to normal right now right after COVID, and really, I think this could impact the amount of workforce and potentially foreign employees that they want to hire," Cristina Perez, an immigration lawyer at the law firm Leech Tishman, said. "I think that's not a good thing. There's study after study that shows H-1B beneficiaries really are a benefit to this country."

Why the USCIS wants to raise fees — and why experts are skeptical 

Experts aren't surprised that the USCIS wants to raise fees, especially since it's been so long since the last increase.

Under President Donald Trump's administration, the USCIS attempted to dramatically raise fees for naturalization and looked to collect $50 from asylum seekers. The changes would have also ended many fee-waiver programs for low-income visa applicants. Those changes were blocked in federal court in 2020.

The Biden administration is taking a different approach, with the USCIS now saying that it intends to use the $600 in additional fees for specialized visa programs like H-1B to keep the process free for those seeking asylum at the border.

Critics say the fee hikes wouldn't solve any problems

Critics say the planned fee increase would make life harder for visa seekers, without addressing any of the problems with the immigration process, including the massive backlog of visa applicants.

"Our system is definitely not working. It is not efficient. It is riddled with inconsistencies," Perez said. "Fix the problem first, then raise the fees."

Some in the industry hope it starts a discussion about what it takes to retain global talent. Sunny Shuoyang Zhang, a founding partner at Born Global Ventures, said she hoped this could be used to educate employers about what it takes to keep global talent in the US, when they have the option to go places with friendlier immigration policies, like Canada. 

Manan Mehta of Unshackled Ventures, which helps immigrants found companies, had a more-positive outlook. He said given that people on H-1B and other specialized visas often earned high salaries, the fee hikes for visa applications could just be factored into that overall cost.

The timing of it all is what presents a challenge, given the state of the economy. Additionally, lawyers are skeptical that the USCIS would be able to turn things around and fix broken systems with the additional money it would be bringing in. 

"I just don't see how this breaks the vicious cycle that we're in right now," Anver of Erickson Immigration Group said. 

Are you an H-1B visa holder and have a story to share? Contact this reporter via email at pzaveri@insider.com or Signal at 925-364-4258. (PR pitches by email only, please.)