White House welcomes Infosys decision to hire Americans
Ninio Fetalvo, a White House spokesman stated to the media that "We're glad to see companies like Infosys see opportunity in the American economy again." The statement was in response to Infosys's decision to hire 10,000 US techies and set up 4 tech parks in the country. The Trump administration said it was a sign that companies were renewing investment interest in the US.
In the midst of the mad dash for H-1B visas, for which entries open every April, the new administration in Washington DC played a trump card through a Homeland Security memo, notifying tougher vetting procedures for computer programmers. The move is in line with President Trump's pledge to put American workers first. Let us explore how this could affect Indian citizens and IT companies.
The memo directs companies applying for H-1B visas for computer programmers, to specify whether the job is complex and requires a professional degree. This is the first time H-1B visa norms have made distinctions between programming roles. Programmers are the third largest recipients of H-1B visas, and overall, 40% of applications are for jobs in the lowest wage scale, which is being specifically targeted.
Around 85,000 H-1B visas are issued every year, for which a fresh cap is opened every April 1st by the US Citizenship and Immigration Services (USCIS). A Brookings Institution report in 2012 found that there were 17 H-1B applications per 1,000 jobs in Silicon Valley.
20,000 H-1B visas are reserved for those with Master's Degree from the US, while 6,800 are usually kept for citizens from Singapore and Chile as part of agreements with the USA. In 2016, 2,36,000 applications were received for 65,000 visas. In 2014, IT companies from India took 21,750 of the number, while 86% of the total visas went to IT professionals from India.
The move will affect Indian IT firms like TCS, Infosys, Wipro, HCL, Mindtree and Cognizant, which are major users of H-1B visas. In 2015, the eight top employers using H-1B visas were Indian firms. Moreover, hiring high-level workers on low-scale visas to cut costs is a major racket this memo deals with, which would directly impact the profitability of Indian IT companies.
Indian technology giant Infosys has decided to open four technology centers and hire over 10,000 US techies in light of the new limitations on the H-1B visas. The first technology center will be opened in Indiana in August, the home state of US Vice President Mike Pence. Infosys CEO Vishal Sikka said "obviously, creating more American jobs and opportunities is a good thing."