Lottery out, wage-based selection in: Trump's new visa proposal for H-1B

The Trump administration has proposed an overhaul of the H-1B visa program, aiming to prioritise higher-skilled and better-compensated workers. The proposed changes, outlined in a Federal Register notice released on Tuesday, would shift the current lottery system to a wage-based selection process, giving higher-paying jobs better chances of being selected.

The total wages for H-1B workers are projected to increase to $502 million in fiscal year 2026, according to estimates from the U.S. Department of Homeland Security. The increase would rise by $1 billion in 2027, $1.5 billion in 2028, and $2 billion annually from fiscal 2029 to 2035.

The proposal could significantly impact small businesses, with approximately 5,200 firms currently receiving H-1B visas expected to face labor shortages.

US Citizenship and Immigration Services (USCIS) will open a 30-day public comment period starting Wednesday.

On Friday, US President Donald Trump signed an executive order introducing a $100,000 fee for new H-1B visa applications. This marked a sharp increase from the previous fee range of $215 to $5,000, based on company size.

The goal, according to the administration, is to address "misuse of the program," ensuring that only highly skilled foreign workers are selected while encouraging employers to prioritize American workers.

The H-1B visa is vital for U.S. industries like tech, which rely on foreign talent, particularly from India and China. The significant fee hike, effective from September 21, has sparked controversy. Critics argue it could stifle innovation and push talent toward countries like Canada and the UK, while supporters claim it protects American jobs by discouraging the hiring of lower-paid foreign workers.

(With inputs from Reuters)