Restrictive visa policy could slow down US growth, push tech and healthcare firms to offshore solutions, and disrupt innovation more than immigrant hiring.
US President Donald Trump shocked the global tech and business community this weekend by announcing a $100,000 fee on new H-1B visa applications, sparking panic among skilled workers and companies relying on immigrant talent — particularly from India.
While the White House has since clarified that the fee applies only to new applicants and is a one-time charge, economists believe the damage may already be done — not just to immigrant hopes, but to America’s economic competitiveness.
How Trump’s H-1B Visa Fee Could Backfire on the US Economy
According to experts, the new visa fee may have long-term negative effects on U.S. innovation and productivity, particularly in sectors that rely heavily on foreign talent.
Key Points from Economists:
- H-1B visas fuel critical roles in technology, healthcare, education, and research.
- Making visas expensive could create a “brain drain in reverse”, reducing access to global talent.
- AI investments may not be enough to make up for the loss of skilled human capital.
“This is classic anti-growth policymaking,” said Atakan Bakiskan, economist at Berenberg Bank, speaking to The Guardian.
“The brain drain will weigh heavily on productivity, and U.S. growth could dip even further.”
Berenberg recently revised its US GDP forecast downward, from 2% to 1.5%, citing immigration policy risks. Bakiskan warned that even 1.5% may be optimistic if such policies continue.
Big Tech and Healthcare Most at Risk
While giants like Amazon, Microsoft, Google, Apple, and Meta can afford the visa fee, smaller tech startups, hospitals, and universities may not.
“Healthcare and education sectors also rely on H-1B workers and may struggle to fill roles under these costs,” said Kathleen Brooks, Research Director at XTB.
This could lead to:
- Delays in patient care and medical research
- Slower product development
- Higher costs passed to consumers
India’s Dominance in the H-1B Program
Indian nationals have long dominated the H-1B visa program, accounting for over 70% of visa holders.
Indian-origin leaders now head top US companies like:
- Sundar Pichai – Google
- Satya Nadella – Microsoft
- Arvind Krishna – IBM
Indian doctors also make up nearly 6% of the U.S. physician workforce, highlighting the depth of Indian talent contributing to American healthcare.
Who Will Really Be Affected More?
While Indian workers may face initial disruption, experts believe the US economy may suffer deeper, longer-term impacts.
According to NASSCOM, the fee hike could:
- Disrupt onshore project continuity
- Trigger project repricing or delays
- Encourage companies to shift work offshore or use remote gig workers
“Companies may now avoid visa sponsorship altogether,” said Aditya Narayan Mishra, CEO of CIEL HR.
“We could see a rise in remote contracting and offshore delivery models.”
India Already Preparing for the Shift
Major Indian IT firms like Infosys and TCS have already:
- Increased local hiring in the US
- Built offshore delivery capabilities
- Diversified staffing models to reduce visa dependency
These adjustments may soften the blow for India, while U.S. clients may bear the increased cost or experience project slowdowns.
Conclusion: Short-Term Politics, Long-Term Consequences
While the $100,000 visa fee may appeal to Trump’s political base, experts warn it could:
- Deter global talent
- Slow economic growth
- Undermine the US’s leadership in technology, research, and innovation
In contrast, India seems poised to absorb the shock, adapt quickly, and even gain new outsourcing opportunities as the US faces growing challenges in talent acquisition.
