President Trump’s work visa suspension makes Canada more attractive for Indians
Starting tomorrow Indian engineers and science graduates, keen to find jobs in America, will find yet another door closed. Under orders from President Donald Trump, the issuance of U.S. temporary work visas will be suspended for highly skilled labor, for their spouses, for executives transferred by large companies and for scholars and professors.
The decision will provide jobs to at least 525,000 Americans, according to the Trump Administration, though other forecasts estimate that the number of jobs will be around 325,000.
Indian graduates could lose their family homes
Trump’s order, to be in effect till this year’s end, will mean no jobs in America for an equal number of foreign professionals, mainly Indians. Foreign students graduating with science, technology, engineering and math degrees are still eligible for Optional Practical Training (OPT) visas, directly related to a student’s area of training and a large source of temporary highly-skilled immigrant workers. Such visas can be extended for up to three years, helping Indians find work and repay part of their student loans. In 2017, Indians got 122,000 OPT visas, 44% of the total issued that year.
But since then, due to Trump’s policies the growth rate of the OPT program has slowed. After the spike in U.S. unemployment, resulting from the COVID-19 lock down, anecdotal evidence suggests employers have sharply cut back on hiring graduates on OPT visas, except in a few areas like artificial intelligence and medicine.
Indians, who took loans to study at American universities, risk losing their family homes to banks in India. They won’t have high paying jobs in America and so may not be able to repay $70,000 or more in student loans they borrowed from banks, using their homes as collateral.
Protecting American jobs
The entry of millions of foreign temporary workers “through the H-1B, H-2B, J, and L nonimmigrant visa programs…presents a significant threat to employment opportunities for Americans affected by the extraordinary economic disruptions caused by the COVID-19 outbreak,” according to Trump’s White House proclamation.
In May, four Republican senators wrote to Trump stating, “As you know, more than 33 million Americans have filed for unemployment coverage just since mid-March, and approximately one-fifth of the American workforce is currently out of work…there is no reason to admit (one million temporary guest workers)…when our unemployment is so high.”
Two-thirds of Americans seek pause in immigration
Americans across the political spectrum seek to restrict immigration, including of highly skilled workers. In April, a Washington Post-University of Maryland poll, found that 65 percent of Americans support suspending immigration because of the pandemic. This included 67 percent of independents, 61 percent of non-whites and 49 percent of Democrats.
The U.S. chapter of Girls who code, a non-profit pushing for more technology jobs for women around the world, opposes the issuance of American work visas. This is because currently there are 80,000 women in the U.S. looking for coding jobs, Tarika Barrett, chief operating officer of the U.S. chapter, told CNBC this week.
Even before the virus hit, Trump was under pressure from his conservative base to cut immigrant visas. In February for instance, the right wing Breitbart.com, was critical that “…at least one million non-immigrant Indians now hold jobs as temporary contract workers in Americans’ white-collar workplaces.” They replace “…many U.S. graduates who are fired, displaced, or ‘re-badged’ from a huge variety of middle-class jobs in software, accounting, management, recruitment, design, engineering, and even regulatory enforcement.” This Indian labor force “also suppress salaries for college-educated Americans,” Breitbart continued.
In 2015, Jim Jefferies, president of IEEE-USA, criticized H-1B skilled worker visas for eliminating “U.S. high-skill, high-wage jobs, as well as the taxes and economic activity it generates." More than half of current H-1B visas are used by outsourcing companies. These firms, Jefferies said, specialize in replacing Americans with cheaper foreign labor and eventually shipping the jobs overseas.
IEEE, the Institute of Electrical and Electronics Engineers, is a professional and lobbying arm representing over 200,000 engineering, computing and technology professionals in the U.S., including Indians. It supports the green card program which, unlike the H-1B visa, allows its holder to transfer to any jobs, thereby preventing employers from pushing down wages.
Sundar Pichai & Elon Musk criticize work visa suspension
Yesterday, following Trump’s order, Apple, Amazon, Facebook, Microsoft and other technology companies issued statements opposing Trump’s suspension of work visas. Sundar Pichai, chief executive of Google for instance, tweeted, “Immigration has contributed immensely to America’s economic success, making it a global leader in tech…Disappointed by today’s proclamation.”
Elon Musk, 48, founder of Tesla, and SpaceX, tweeted, “Very much disagree with this action. In my experience, these skillsets are net job creators. Visa reform makes sense, but this is too broad.” Musk, 48, with an estimated net worth of $43 billion, grew up in South Africa, migrated to Canada with his family at 17 and came to the U.S. to study physics and business at the University of Pennsylvania. He is a vocal supporter of many of Trump’s policies, including on COVID-19.
Migrate to Canada
Unemployment in the U.S. is forecast to stay over 10% at least until late 2021. So, if Trump is re-elected, or even if Democrat Joe Biden wins the U.S. Presidency this November, the suspension of work visas is unlikely to be lifted. Or, at least it will not be lifted soon and perhaps not completely.
Indian students, who got admitted to American universities for the academic year beginning in September, should cancel their admissions. Instead of taking on big loans to study in the U.S., it would be much more prudent to enroll in Canadian universities. In 2019, the number of Indians who became permanent residents in Canada doubled to over 81,000, compared to the previous year.
In May, due to the COVID-19 lock down, the unemployment rate in Canada jumped to 14%, up from around 7.5% in January. So, this year, the country may issue fewer work and permanent residency visas. But it faces a shortage of skilled labor and also has a population which is rapidly aging. Equally important, American companies, seeking to by-pass the visa restrictions in the U.S., are expanding their operations and hiring in Canada.
The United Kingdom too is eager to attract highly skilled labor. “If you’ve been affected by the ridiculous decision to suspend H1-B in the US, take a look at the UK Global Talent Visa,” tweeted James Wise, a partner at Balderton Capital. Based in London, it is one of the largest early stage venture firms in Europe, managing over $1 billion. “The UK’s a hub for global tech, has more developers & venture capital than most of the East Coast (of the U.S.) & a great place to start a company,” Wise continued. But the UK issues a maximum of 2,000 talent visas a year and they must also be approved by one of five professional organizations in the country.
Matt Turck, a partner at FirstMark Capital, supports the idea of looking for careers outside America. FirstMark is an American venture capital firm managing $2.2 billion. Turck, an immigrant to the U.S. from France, tweeted after Trump’s decision:“I was on an H1B visa for 10 yrs. Started a company with co-founders also on H1Bs. Hired American employees, served US customers. This was our American dream. But today the same company could be started anywhere. Why would the next generation bother if they can’t get a visa?”