The Wayside Youth & Family Support Network has long struggled to recruit local teachers for its private special education school, relying on a skilled visa program to hire workers from countries like Brazil, Mexico and Germany.
Sara McCabe, the president of the Massachusetts-based nonprofit, said the school has five open teaching positions that it would usually try to fill through the H-1B program. But after the Trump administration attached a steep $100,000 fee to new H-1B visas last fall, Ms. McCabe said the nonprofit could no longer afford to use the program. As a result, the school has turned away a dozen students who have tried to enroll because it cannot hire enough special education teachers to offer more classes.
“The $100,000 fee has closed the door for us,” Ms. McCabe said.
Since imposing the fee in September, the Trump administration has upended the H-1B program, a critical pipeline for a broad swath of employers ranging from big tech companies and consulting firms to hospitals and schools. The result has been a fundamental shift in who gets to benefit from the visa program, which was put in place three decades ago.
The effects have been uneven across employers, with the burdens falling most heavily on smaller firms, nonprofits and rural hospitals that are having a harder time gaining access to the program because they cannot cover the costs anymore. Many companies that largely recruit workers overseas have also significantly reduced their applications, including IT firms that have been among the biggest beneficiaries of the program, according to immigration lawyers.
The program has long been a source of controversy, one that has splintered President Trump’s base. It has prompted outrage over instances of employers abusing the program to sideline Americans and hire foreign workers at lower pay. Still, economists generally agree that the program provides a net benefit to the U.S. economy and raises wages even for American workers.
The new fee is just part of the Trump administration’s attempt to drastically overhaul the H-1B program. In February, regulatory changes that would favor the allocation of the visas to higher-paid jobs took effect. Last month, the Labor Department proposed a rule that aims to lift the minimum wages that employers have to pay H-1B visa holders. Administration officials say the goal is to incentivize companies to prioritize hiring American workers and better protect their wages.
The changes have not choked off demand for H-1B visas, in part because the $100,000 fee is not applied uniformly. It applies only to workers outside the United States, meaning firms that hire people already in the country with a different form of status — such as an international student who needs an H-1B visa to remain in the United States — are able to skirt the fee. Previously, a typical visa cost companies roughly $10,000, including legal fees and administrative costs, immigration lawyers said.
The biggest tech companies have largely been shielded from the changes because they mostly use the H-1B program to recruit international students and other foreign workers within the country, according to immigration lawyers. They are also more likely to have the money to absorb the new fee.
“The impact of these changes has not been uniform,” said Vic Goel, a Virginia-based immigration lawyer representing corporations.
Demand for the visas usually far outstrips the small number that are available each year and distributed through a lottery system. Last year, the federal government received more than 343,000 registrations for the lottery, about four times the 85,000 visas awarded annually.
Last week, U.S. Citizenship and Immigration Services, the agency that awards the visas, said it received enough registrations to meet the 85,000 cap this year. The agency declined to provide data on the total number of registrations it received this year.
Companies typically have to enter the lottery once a year to compete for new H-1B visas. But some employers, including nonprofit universities and hospitals, are not subject to the cap and can apply for the visas year-round.
Although demand remains relatively strong, many immigration lawyers said they saw big declines in the number of companies applying for H-1B visas this year. Other federal data has also shown signs of suppressed demand.
Between Sept. 21 and Feb. 15, the number of H-1B applications submitted by employers not subject to the cap was down 15 percent compared with the same period the year before, according to data from the Department of Homeland Security. And the federal government received only 85 payments of the $100,000 fee as of mid-February.
The figures were made public in court documents stemming from a legal challenge brought by employers and unions shortly after the administration imposed the new fee.
Toni Xu, an immigration lawyer based in New York and Silicon Valley, said she saw a 50 percent drop in the number of clients who have applied for the H-1B program this year compared with previous years. “There’s been a chilling effect on employers,” Ms. Xu said.
Rural hospitals and providers said the $100,000 fee has made it harder for them to recruit staff, which has spurred intense lobbying efforts by medical associations.
Michaelle Waters, the office manager at Nephrology Associates of the Carolinas in Shelby, N.C., said the private practice is trying to hire a physician in India through the H-1B program, but the federal government recently denied its request for a fee waiver, which is granted only to foreign workers whose presence in the country “is in the national interest.”
Ms. Waters said the practice was unsure if it could still recruit the doctor because it could not afford the $100,000 fee. The practice’s owner is considering taking out a loan to pay the fee, she said.
“Filling the position with a domestic candidate is not really feasible,” Ms. Waters said. “They’re not interested in coming here. We can’t compete with bigger areas.”
Ms. Waters said the practice’s current physicians are “tired and strained.” Hiring another doctor would give them a better work-life balance and allow the practice to see new patients in a more timely manner, she said.
Some hospitals said they would no longer recruit nurses or lab technicians through the H-1B program, but they were willing to shell out $100,000 for new physicians.
Jay Reynolds, the president of Northern Light AR Gould Hospital in Presque Isle, Maine, said the hospital recently paid the $100,000 fee to hire a German doctor for a general surgeon position that it had struggled to fill for about three years. To offset the cost, he said the hospital might have to defer maintenance on its buildings or delay the purchase of medical equipment.
Other employers were more optimistic about the Trump administration’s changes.
Gaurav Bhattacharya, the chief executive of Jeeva AI, a San Francisco-based firm that automates repetitive tasks for sales teams, said he had mixed thoughts about the lottery system now prioritizing higher-paid positions, given that it was challenging for start-ups like his to compete with the wages offered by the largest tech companies.
But he said he liked the $100,000 fee because it could reduce overall competition for H-1B visas if fewer employers entered the lottery. He also did not expect the fee to affect his company, given that it typically recruits international students who would not be subject to it.
“This actually increases the chances for people who came to the U.S. and got a U.S. education,” Mr. Bhattacharya said. “I think that’s brilliant.”
Madeleine Ngo covers immigration and economic policy for The Times.
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