Another Talent Exodus From The US

On today show, we are talking about the impact of the newly announced $100,000 fee associated with the H1B visa to the United States. 

According to my research, historically the United States had admitted 65,000 H1 B visas per year with an additional 20,000 visa for those holding advanced US degrees.

Anytime there is a major policy shift. The marketplace will adapt and find a new way to optimize the allocation of talent. Silicon Valley was cited as one of the Main reasons for the policy change.

The tech industry has seen significant layoffs over the past year. Companies like Microsoft, Amazon, Google, Facebook have all released tens of thousands over the past year.

The policy change will probably see some of those laid off workers getting rehired and those international workers covered by a visa, now a very expensive visa, being sent home to their country of origin.

The largest user of H1B visas is Amazon with over 14,600 visa holders. At $100,000 a year each, this would cost an additional $1.4B in fees to the US government. I personally would be surprise if any company would just roll over and pay for an additional $1.4B in fees. 

The top users are Amazon, TCS from India with about 5500, Microsoft with a little over 5100, Meta with about 5100.

Even Walmart has about 2400. I would bet that Walmart would move those positions to their software design center in Toronto or Ottawa and save $239M dollars with zero loss of productivity. 

When I ran an engineering organization, we did not use the H1B Visa program to import labour per se. We used the program to bring a few people from some of the remote design centres and immerse them in the culture in our Sunnyvale office so that they could in turn cross pollinate the culture across the organization. It gave that individual a foreign expat assignment and at the same time improved the cohesiveness between the different design centres around the world. They would later return to their remote design centre. 

I personally believe that the use of the H1B Visa will drop to nearly zero with the imposition of this new policy. That means another 100,000 people in high paying jobs will likely leave the US. These people will probably continue to work for the same company from their country of origin, if they are an individual contributor. If they are in a managerial role, then the relationship gets more complicated. I truly can’t think of too many companies that will be willing to pay that $100,000 fee for the visa. 

This year 2025 was the first year in which US population has shrunk in almost 100 years. 

Shrinking population means a shrinking economy, especially when you consider that 70% of the GDP is based on consumption. 

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Episode Transcript

(00:01):
Welcome to the Real Estate Especial podcast, your morning
shot of what's new in the world of real estate investing.
I'm your host, Victor Manash. On today's show, we're talking
about the impact of the newly announced fees associated with
the H1B visa to the United States.
Historically, the US has admitted about 65,000 H-1B visas
per year, with an additional 20,000 visas for those who hold

(00:22):
advanced US degrees. Any time there's a major policy
shift, the marketplace will adapt and find new ways to
optimize the allocation of talent.
Silicon Valley was cited as one of the main reasons for the
policy change. Now, if you've been following
the show for a while, you'll know that I do have a tech
background. And I was vice president of
engineering and chief technical officer at AMCC, which had its
headquarters in Sunnyvale, rightin the heart of Silicon Valley.

(00:45):
I spent considerable time there.My engineering organization had
13 design centers all over the world.
I had staff in India and Bangalore, in Manchester in the
UK, two locations in France, as well as several locations across
the US and Canada. We did make some use of the H1B
visa, but not in large numbers. The newly assessed fee for the
H1B is not a one time fee, but an annual fee.

(01:06):
And once an organization has built a relationship with a
skilled individual, that job often can be relocated outside
the US with a little impact on overall productivity.
The biggest challenge is 1 of time zones.
Imagine for a moment that you'rethe head of an HR department at
a major corporation like Google or Hewlett Packard or IBM.
Most important consideration is that your remote employees are

(01:27):
able to participate in video conference meetings during core
business hours. If your office is in Seattle or
San Jose, you'd be willing to locate some of your staff to
Vancouver or Toronto or Ottawa if you know this was going to
save you 100,000 a year per individual.
You'll now be paying those employees in Canadian dollars
versus U.S. dollars and you get to save in multiple ways with

(01:48):
almost no loss of productivity. Now the tech industry has seen
some significant layoffs in the last year.
Companies like Microsoft, Amazon, Google, Facebook have
all released 10s of thousands ofpeople in the last year.
The policy change will definitely see some of the laid
off workers may be getting rehired and those international
workers were previously covered by visa, now a very expensive
visa being sent home to their country of origin.

(02:10):
The tech industry does not require most specific job
functions to be tied to a geographic location.
If the job function is in support of say a newly
constructed factory, maybe a semiconductor fab, then yes,
that job will not be easily relocated.
For the rest, if they're involved in software
development, companies will exercise the flexibility to move
those jobs. Outside of the US, the largest

(02:31):
user of H1B visas is Amazon withover 14,600 visa holders at
100,000 a year. That would cost an additional
1.4 billion in fees to the US government.
I personally would be surprised if any company would just roll
over and pay for an additional 1.4 billion in fees.
The top users are Amazon, Tata Consulting Services from India
with about 5500 people, Microsoft with a little over

(02:54):
5100, Meadow with about 5100. Even Walmart has about 2400
people with H1B visas now. I would bet that Walmart would
move those positions to their software design centers located
either in Toronto or Ottawa and save the $239,000,000 with zero
loss of roductivity. And when I ran the engineering

(03:14):
organization, we didn't use H1B visas to import labor per SE.
We used the program to bring a few people from some of the
remote design centers, immerse them in the culture of our
Sunnyvale office so they could in turn return to their their
home design center and cross pollinate the culture across the
organization. It gave that individual a
foreign expat assignment and at the same time improve the

(03:37):
cohesiveness of the different design centers across the world.
They would later return to the remote design centers.
Another large user, the H1B visahas been in fact the medical
industry where doctors completing the residence as part
of their medical training have to transition from a student
visa to an H1B for the period oftheir residency and during
residency. A doctor in training does

(03:57):
receive a salary, but it's pretty low compared to what they
would be earning when fully licensed.
There was no way that a hospitalis going to pay 100,000 a year
on top of the medical resident that might be only earning
55,000 a year in salary. The proposed change could result
in a major disruption of the nation's healthcare system.
Now of course, this is a real estate podcast, not an
immigration law podcast. If I put myself back in the

(04:19):
mindset of VP of Engineering in my prior tech career, I would be
looking to immerse people from our remote design centers over a
shorter period of time. I would probably look to utilize
the B1 visitor visa which has a six month time limit and 0 cost.
These employees would continue to be employed in their home
country. They would not be working in the
US. They would be consulting with

(04:39):
business associates. Does not allow for local
employment or work for hire in the US.
Now, some companies have tried to skirt the rules.
The use of 475 workers at the Hyundai battery plant in Georgia
with temporary business visas were in fact being used for the
construction of the plant. That feels to me like an abuse
of the temporary visa from a distance, although I'm not close

(05:00):
enough to the situation to be able to comment on it with any
authority. I personally believe that the
use of the H1B visa is going to drop to nearly zero with the
imposition of this new policy, and that means another 100,000
people in high paying jobs are likely to leave the US, probably
within the year. These people will probably
continue to work for the same company in their country of
origin as long as they're an individual contributor.

(05:22):
If they're in a managerial role,then the relationship gets more
complicated. I truly can't think of too many
companies that'll be willing to pay that $100,000 fee for the
visa. So this year, 2025, was the
first year in which the US population shrunk in almost 100
years. And shrinking population means
shrinking economy, especially when you consider that 70% of

(05:42):
GDP is based on consumption. As you think about that, have an
awesome rest of your day. Go make some great things
happen. We'll talk to you again
tomorrow.