After announcing a new $100,000 fee on H-1B visas, the Trump administration on Tuesday proposed overhauling the visa’s lottery selection process to prioritize higher-paid and higher-skilled foreign employees.
The proposed policy changes could reignite the debate over the use of foreign labor by U.S. employers.
The move comes as President Donald Trump has taken aim at H-1B visas, a program used widely by Big Tech and outsourcing companies to hire foreign workers, announcing Friday that companies would be required to pay a $100,000 fee with new applications submitted after Sept. 21.
The administration on Tuesday targeted H-1B visa allocation, proposing a “weighted selection process” for when annual demand for the visas tops the 85,000 limit set by Congress, which it says has happened every year for more than a decade.
The new process would replace the current lottery system that determines who gets to apply for those limited visa spots in favor of putting more weight on higher skilled and higher paid foreign workers, according to a proposed rule set to be published in the Federal Register on Wednesday.
Under the current lottery rules, offers to apply for an H-1B visa are assigned at random.
The Trump administration’s proposal would assign prospective employees to four different wage bands, with workers in the highest wage category being entered into the selection pool four times and those in the lowest wage category being entered into the selection pool once.
The Department of Homeland Security stated in the proposal that the weighted system would better serve the visa program’s original intent and “incentivize employers to offer higher wages or higher skilled positions to H-1B workers and disincentivize the existing widespread use of the H-1B program to fill lower paid or lower skilled positions.”
It said the proposed selection process would still maintain opportunities for employers to hire H-1B workers at “all wage levels.”
‘A strong signal’
The H-1B visa program allows U.S. employers to temporarily hire skilled foreign workers in “specialty occupations” across health care, tech and finance industries, and other STEM-related fields.
The two new proposed policies together send “a strong signal of the direction that the administration wants to go,” said Xiao Wang, CEO of Boundless Immigration, a company that offers services to people navigating the immigration process in the U.S.
If adopted, the policies would benefit companies seeking to keep foreigners with specialized skills who studied at American universities in the U.S., as well as ensuring H-1B visas “disproportionately go to people who are deemed higher skilled, represented by higher wages and higher salary,” he said.
Trump stated Friday that changes were needed in the visa system, saying it was designed to bring in temporary workers with “additive, high-skilled functions, but it has been deliberately exploited to replace, rather than supplement, American workers with lower-paid, lower-skilled labor.”
For the last H-1B lottery round, which closed its registration in March, about 339,000 people applied. Of those, 120,141 applications were selected for the lottery, according to USCIS data.
The proposal faces a 30-day public comment period before it is considered by the administration for a final rule, a process that could take months.
If the changes are adopted, companies seeking to hire lower-wage workers from India and China for computer-related jobs appear likely to be among the most affected. For more than a decade, about 60% of H-1B workers approved every year have held computer-related jobs, according to Pew Research.
Start-ups and smaller companies who cannot afford to pay their workers in the higher pay categories compared to major tech companies would also be impacted, Wang said.
Deedy Das, a partner at Menlo Ventures venture capital group, said in a social media post that the latest proposal would hurt many tech companies.
“Overall, it’s really bad for startups, early employees, helps IT consulting shops and can be easily gamed,“ Das wrote.
Trump’s announcement of a new $100,000 fee on H-1B visas touched off a frenzy among current visa holders, the companies that employ them and countries around the world as they worked to understand the edict.
Eventually, the White House clarified that it would be a one-time fee and apply only to new visa applicants.
Trump said companies would have to pay the fee for new H-1B visa applications submitted after Sept. 21. That’s a steep rise from current fees, which are usually $2,000 to about $5,000.
Both the fee and Tuesday’s proposal are likely to face challenges in court.
A growing chorus on both the left and the right say an over-reliance on the visa by U.S. firms has put U.S.-born workers at a disadvantage. Commerce Secretary Howard Lutnick has called the H-1B visa program a “scam,” while the left-leaning Economic Policy Institute has claimed that some of the companies most reliant on H-1B visas, such as Amazon and Facebook’s parent, Meta, have also had sizable layoffs, though it did not cite evidence that the use of the visa and the layoffs are related.
In the first half of 2025, Amazon received approval for more than 12,000 H-1B visas, while Meta received more than 5,000.
Representatives for both companies did not immediately respond to requests for comment.
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