Trump effect? H-1b visa approvals for Indian IT companies drop by 43%

Top seven Indian IT companies experienced a whopping 43 per cent drop in their H-1B visa approvals between 2015 and 2017, a US think-tank has said.

The National Foundation for American Policy in a report said that the 8,468 new H-1B visas for Indian-based companies in the financial year 2017 equaled only 0.006 per cent of the 160 million in the US labour force.

The top seven Indian-based companies received only 8,468 approved H-1B petitions for initial employment in FY 2017, a decline of 43 per cent for these companies since FY 2015, when it received 14,792 H-1B visas.

Given that 199,000 applications were filed in FY 2017 for the FY 2018 cap year 105,000 in excess of the FY 2018 H-1B annual limit even if none of these companies received new H-1B visas the annual limit still would have been reached on the first day of the April filing period, it said.

"The data indicate the problem is not which companies are receiving H-1B visas, which some contend, but that the 85,000-annual limit is too low for an economy the size of the United States," it argued.

Based on the H-1B visa data obtained from the US Citizenship and immigration Services (USCIS), the foundation said that the Tata Consultancy Services (TCS) received 2,312 H-1B visas in 2017 as against 4,674 in 2015, registering a drop of 51 per cent.
 

Infosys, during the same period saw a whooping drop of 57 per cent from 2,830 in 2015 to 1,218 in 2017. Wipro received 1,210 H-1B visas in 2017 as against 3,079 in 2015.

Among the seven Indian-based companies the H-1B approval of Tech Mahindra went up from 1,576 in 2015 to 2233 in 2017.

In its analysis, the National Foundation for American Policy said that the drop in H-1B visas for Indian-based companies is due to industry trends toward digital services such as cloud computing and artificial intelligence, which require fewer workers, and a choice by companies to rely less on visas and to build up their domestic workforces in the United States.

In most cases, companies require fewer people per project, it argued.

Also, like all companies, including US companies, restrictions on visas may result in more work being performed outside the US, which is the unintended consequence of many immigration restrictions in a global economy. Indian-based companies, of course, must compete for the same relatively limited pool of tech talent in the US as other companies, it said.

The foundation said, corporate clients of both the US and Indian-based IT services companies are requesting digital engineering and more sophisticated services, including better data analysis, that require fewer workers and more advanced technology, and this is reflected in the H-1B visa numbers.

While Cognizant, an IT services company headquartered in Teaneck, New Jersey, had the most H-1B petitions approved for new employment in FY 2017, with 3,194, that represented a decline of 800 approved petitions, or 25 per cent from FY 2016.

Further, five of the seven top Indian-based companies saw declines in FY 2017 from FY 2016 Infosys, Wipro, HCL America, Larsen & Toubro and Mindtree.

Only TCS, with an increase of 13 per cent, and Tech Mahindra, which increased by 42 per cent, had more H-1B petitions for initial employment approved in FY 2017 than in FY 2016, it said.