Amid layoffs, 87% employers currently hiring foreign national employees in the US, survey shows

With thousands of employees laid off across tech giants including Microsoft, Google, Meta, and Amazon, Twitter in the past couple of months have left many employees worried about their job security. The layoffs has affected the future of H1B visa holders as in a span of 60 days, they either need to find another company to sponsor their visas or leave the country. 

The H-1B visa is a non-immigrant visa that allows US companies to employ foreign workers in speciality occupations that require theoretical or technical expertise.

Now, survey report published by Envoy Global has stated that 89 percent of US companies hired one or more foreign national employees who were previously laid off by another company in the last six months. The report titled 2023 Immigration Trends has also showed that that employers are currently recruiting and hiring foreign national employees in the US. In 2022, as per the survey report, companies with foreign national employees experienced layoffs and hiring freezes due to macroeconomic trends. “About 78 percent of companies instituted a hiring freeze while 58 percent companies laid of foreign nationals.”

The survey was conducted from 13-20 February 2023, with 504 HR professionals participating from across a variety of industries and company sizes. A total of 443 responses were received.

Speaking of hiring, the survey also highlighted that 89 percent of employers are currently hiring foreign national employees in the US. That momentum should continue this year too, the report states as employers expect to submit slightly more H-1B registrations than they did in 2022, which saw a record of 483,000 submissions.

Furthermore, it also showed that employer demand for foreign talent is higher now than in early 2022, when the Department of Labor recorded an all-time high in foreign employee sponsorship. 

Seventy One percent of companies report recruiting more foreign nationals in Q1 2023 than during the same period last year, it stated.

The survey report said that though there is a rise in demand to sponsor foreign talent in the US, immigration barriers are leading employers to relocate foreign national employees overseas and outsource jobs.

Last year, 81 percent of companies transferred foreign national employees to an office abroad because of visa-related issues in the US while 80 percent of companies relocated employees to work remotely overseas because of visa-related issues.

US immigration barriers commonly cause employers to lose foreign talent. Last year, 82 percent of employers saw a foreign national employee forced to depart the US because they were unable to obtain or extend an employment-based visa. It also stated that 94 percent of companies would hire more foreign nationals if there were fewer immigration barriers in the US. 

The report also highlighted employers view on Biden administration's approach to employment-based immigration. Some employers approved, however, many felt the system continues to become more difficult for businesses. Eight four percent of respondents approved of the Biden administration's handling of employment-based immigration while 51 percent felt the immigration process in the US is more difficult than in previous years, it stated.

Also Read: F-1 visa for students: How this new US rule will benefit Indian students

Due to this immigration barrier, other countries gained momentum. The report showed that 62 percent companies preferred relocating employees to Canada, while 48 percent preferred Mexico or UK. Other countries like Germany, Australia also saw relocation with 31 percent and 25 percent respectively. 

The respondents also viewed other countries' immigration systems as more employer-friendly than the US with Canada being the most employer friendly with 87 percent, followed by UK (83 percent), Ireland (78 percent), Singapore (79 percent) and European Union (81 percent).

It also warned that as if these destination become more attractive, the US will lose out on foreign talent flow where it said that 93 percent of companies expect nearshoring or offshoring to fill positions abroad due to immigration barriers and labor shortages in the US. 

The report also showed the primary barrier for an employer when it comes to hiring and sponsoring foreign national employees from which limited number of H-1B visas available was the main concern. The employer also stated other reasons like slow and uncertain government processing, government regulations and paperwork, and costs related to sponsoring a foreign national employee.

Speaking of a primary barrier in US government's agency, the employer viewed Department of Labor as the primary barrier followed by US Citizenship and Immigration Services (UCIS) and Department of state.

Moreover, the business community also came up with key improvements to the employment-based immigration system adding that, some employers were also willing to pay for certain enhancements to the system. 

The survey showed that 89 percent of companies were willing to pay an additional fee to the government for faster processing of immigration cases (expanded premium processing). Some 93 percent preferred digital government platform for immigration cases over the current paper-based system. Fifty eight preferred Congress to increase the overall number of employment-based green cards available each year over removing per-country green card caps while others preferred Congress to remove per-country green card caps over increasing the overall number of employment-based green cards available each year.  

It said that the government's inability to implement solutions is impeding companies' ability to sponsor the foreign talent they need. Respondents added that 94 percent of companies would hire more foreign nationals if there were fewer immigration barriers in the US. The report also stated despite a potential 2050 percent increase in the related government fee for the H-1B lottery, employers continue to pursue foreign talent. “75 percent of companies expect to file more H-1B registrations next year despite a potential 2050 percent increase in the related government fee,” it said.

Earlier in January, the Biden administration had proposed a massive hike in immigration fees, including the much sought-after H-1B visas for high-skilled foreign workers which is very popular among Indian tech professionals. 

Under the proposed rule, published by the US Citizenship and Immigration Services (USCIS), the application for the H-1B visa increases from USD 460 to USD 780, and L-1 from USD 460 to USD 1,385. The application fee for O-1 visas has been proposed to increase from USD 460 to USD 1,055

Not just this, in order to expand hiring options, companies are sponsoring foreign employees on visas beyond the H-1B like L1, TN and O-1 visa, the survey report showed.

Earlier in February, a report had stated that amid rising need to rope in foreign skilled work force, US employers are finding it hard to secure foreign talent due to a low annual limit for H-1B visa approvals. Currently, the annual H-1B visa allocations are capped at 85,000. In contrast to the annual limit, US employers submitted around 4,83,000 H-1B registrations in April 2022, reported US Citizenship Immigration Services(USCIS).

Meanwhile, the initial registration for H-1B cap for financial year 2024 has begun from March 1 and will last till March 17, stated US Citizenship and Immigration Services in a press release. The H-1B type visa is the only way for US employers to temporarily employ foreign workers in speciality occupations. Most often, H-1B type visa holders also get the eligibility for green card. Each year, more than 85,000 applications are received from employers for H-1B visa.