The H-1B Visa, Explained

Amid recent infighting on the social media site X between MAGA Republicans and Silicon Valley tech leaders like Elon Musk and Vivek Ramaswamy over immigration, attention quickly centered on a visa program used by highly skilled workers. Musk and his allies defended the H-1B visas that have been the backbone of their industry while the likes of Laura Loomer, a Trump-allied political activist, argued that the visas were contrary to “America First” policies. 

But what are H-1B visas anyway? 

The specialty occupation visa.

The H-1B visa is a temporary visa that a U.S. employer may request to fill a specialty occupation with a foreign worker. To qualify as a specialty occupation, a position must usually require a bachelor’s degree or higher in a specific field. Common H-1B occupations include software engineers, data scientists, and architects, among others. 

H-1B visas are typically issued for three years initially, but they can be extended for up to three additional years. However, if the employee has applied for permanent residency via an employment-based green card but is awaiting green card availability due to nationality restrictions, H-1B status can be extended beyond the usual six-year limit. 

Every year 85,000 initial H-1B visas are up for grabs, including 20,000 visas reserved for individuals who have earned a master’s degree or higher from a U.S. institution. Because of the limited availability of H-1B visas, recipients are chosen by lottery after being registered by the employer. Lottery registrations regularly exceed annual visa allocations, so registrants are chosen at random to submit a full petition for adjudication. 

Registration numbers dropped significantly in last year’s lottery due to changes in the registration process, but U.S. Citizenship and Immigration Services (USCIS) still received over 470,000 registrations, of which only around 135,000 were invited to submit a full petition. The new process aimed to disincentivize unscrupulous employers from trying to game the system by submitting multiple registrations on behalf of the same employee. In the fiscal year 2024 lottery, before this change was made, USCIS received over 780,000 registrations, including over 400,000 on behalf of people with multiple registrations. 

Institutions of higher education, their affiliated nonprofit entities, nonprofit research organizations, and government research organizations are exempt from the annual cap and can sponsor H-1B visas for foreign employees without competing in the annual lottery. 

Efforts to protect American workers.

Employers seeking to hire foreign workers through the H-1B program have to attest that doing so does not harm American workers. These attestations are submitted to the U.S. Department of Labor (DOL) after a registrant is chosen in the lottery and are required before USCIS makes a determination regarding the merits of an H-1B visa petition. 

Employers must attest that there is not a strike or labor lockout happening in their company at the time of the application. They must confirm that they will notify union representatives and/or employees that a visa application has been filed with DOL, and they must attest that the working conditions—including the hours, shifts, vacations, and benefits—provided to the foreign worker will not negatively affect the working conditions of Americans in similar positions. The employer must also agree to pay the H-1B worker a wage that is at least equal to the wage of its U.S. workers in similar positions or equal to the DOL-designated prevailing wage for that occupation in that location, whichever is greater. The median salary of approved H-1B beneficiaries in fiscal year 2023 was $118,000, according to USCIS. The Labor Department reviews these attestations for completeness and compliance before certifying the application and allowing the employer to proceed. 

Most employers also have to pay a fee, ranging from $750 to $1,500 per H-1B petition, to satisfy the requirements of the American Competitiveness and Workforce Improvement Act. The fees go to grants to help fund training programs for U.S. citizens to prepare them for skilled jobs and thereby reduce American dependence on foreign labor. For example, during the COVID pandemic, such programs trained Americans to address rural health care shortages. In 2023, the grants directed $94 million to training programs intended to boost the pipeline of American workers in advanced manufacturing and information technology fields. 

Soaring demand for the H-1B program.

Despite efforts aiming to reduce dependence on foreign labor and the many requirements that participating employers must satisfy to bring in workers on H-1B visas, demand for these visas still regularly exceeds the program’s capacity. Why is there so much demand? 

The H-1B program has played a critical role in the U.S. immigration system for decades in part because it is one of the only employment pathways available to foreign graduates of American universities who want to stay and work in this country. International students represent nearly 80 percent of graduate students in computer science at U.S. universities, so it is no surprise that computer-related occupations, including computer systems analysts, software engineers, and software developers, accounted for 65 percent of approved H-1B petitions in fiscal year 2023. At current enrollment rates, American universities are not producing enough domestic graduates to meet industry demand, so the H-1B becomes a pipeline to fill the gap. 

Demand for the H-1B also remains high because very little of the employment-based immigration system has been adjusted to meet modern needs. Statutory H-1B allocations have not increased since 2004 though incremental changes have been made through regulation to accommodate some additional demand. For instance, on December 18, 2024, the Department of Homeland Security finalized a rule that clarified visa cap exemptions for certain nonprofit organizations, exempting an additional 0.3 to 0.8 percent of H-1B petitioners from the annual lottery. 

Constraints in other parts of the immigration system also maintain the high demand for H-1B visas, particularly among Indian nationals. Each year, about 140,000 green cards are made available through the employment system, and no country’s nationals may receive more than a combined 7 percent of family and employment-based green cards. Indian nationals must often wait several years longer than nationals of other countries before qualifying for an employment-based green card. Indian nationals made up over 72 percent of approved H-1B beneficiaries in fiscal year 2023. While some of this may be the result of Indian nationals’ prevalence in American universities, it is more likely a side effect of these country caps on the employment-based green card process.

As mentioned previously, individuals can usually extend their H-1B visa beyond the six-year limit if they are in the queue for an employment-based green card. Therefore, while other foreign nationals may cycle off of the H-1B visa because anyone needed long-term in the U.S. would likely have the opportunity to obtain a green card, Indian nationals are much more likely to stay on the H-1B for several years while they await green card availability. Due to these uncapped extensions, the H-1B program had more than 610,000 active beneficiaries as of the last estimate in 2019.

Waiting on Congress.

Legislatively, not much has changed for the H-1B program since the H-1B Visa Reform Act of 2004. Since then, bills have been introduced to expand the size of the H-1B program, prioritize beneficiaries with STEM degrees or higher salaries, or even to exempt holders of postgraduate degrees from U.S. universities from the annual cap and lottery. These legislative efforts have not been successful thus far. 

In 2019 and again in 2024, however, the Department of Homeland Security did change the lottery registration and selection process, and the December 2024 rule used existing authorities to expand and clarify regulatory requirements for startup owners, exempt nonprofits, and recent graduates. These small changes to the program and its administration have increased efficiency and reduced fraud throughout the program, but continued demand, worrisome demographic trends, and growing green card backlogs may require larger congressional action sooner rather than later.