AILSA CHANG, HOST:
The Trump administration's decision to increase the H-1B Visa application fee from up to $5,000 to $100,000 is now in effect. Indicator hosts Wailin Wong and Darian Woods explain what this change could mean for the U.S. economy.
WAILIN WONG, BYLINE: The H-1B Visa program has been in place since 1990. Michael Clemens is an economist at George Mason University who studies immigration, and he says the program is the primary way that high-skilled immigrants come to the U.S.
MICHAEL CLEMENS: It is our largest bridge between the high-skill talent of the world and the U.S. economy.
DARIAN WOODS, BYLINE: The program has an annual cap of 85,000 visa holders.
WONG: But it's changed in size over the years. Congress significantly increased the annual cap in the late '90s and cut it in 2004. These big swings created a natural experiment for economists to study what happened in communities that saw influxes of foreign STEM workers. And Michael says, the evidence shows that H-1B visa workers lead to more patents, more businesses getting started and longer survival of startups.
CLEMENS: This is not he said, she said, in the literature. This is really a universal finding of serious economic research on this subject.
WOODS: One study published in 2015, looked at the 20-year period from when the H-1B visa was created, and the economists concluded that the program was responsible for 30- to 50% of all the productivity growth that happened in the U.S. during that time. A less-settled question, he says, is what happens with wages? The Trump administration says the H-1B visa program undercuts the wages of American workers.
WONG: Now, Michael says, there is research showing that without H-1B workers, competing American tech workers would have seen higher wages. But he points out that this is still in an environment of wages going up across the board.
CLEMENS: A greater supply of one particular kind of worker can make the wages of directly competing workers grow less. But growing less than other people is not the same as going down. What's crucial to understand is that the H-1B visa program needs reform.
WONG: This is because H-1B workers have to be sponsored by employers, and if they want to stay longer term, their employer had to sponsor their green card. That process starts over if workers switch jobs.
CLEMENS: Anything that ties workers to employers reduces wages because it reduces your outside option. Why don't our employers just pay us less? - because we could leave and go somewhere else. H-1B workers often can't. That can depress wages in this program, and that depresses wages in the industry.
WOODS: So Michael thinks more flexibility in the program could help raise wages for workers through more competition among employers. This new fee, he says, is not the answer. Meanwhile, Canada, the U.K. and China are adapting or launching new visa programs aimed at attracting foreign STEM workers.
CLEMENS: In years ahead, when you see China racing ahead in artificial intelligence and other areas, and you wanted to look back and say, well, is there anything the United States could have done differently? There is, and this month of 2025 would be a great place to look.
WONG: Wailin Wong.
WOODS: Darian Woods, NPR News. Transcript provided by NPR, Copyright NPR.
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