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Tech Industry Layoffs Mean Added Headaches for H-1B Visa Workers

Nov. 15, 2022, 3:15 PM

A wave of layoffs at Amazon.com Inc., Twitter Inc., and other major tech companies is creating an additional level of uncertainty for workers on temporary H-1B specialty occupation visas, who face potentially having to leave the country on top of losing their jobs.

H-1B workers generally have 60 days after losing employment or until the end of their visa’s authorized validity period—whichever is sooner—to find a new employer willing to sponsor their visas or leave the US.

The situation is especially disruptive for workers from India and China, many of whom remain on extended H-1B visas for years or even decades while waiting for green cards to become available because of per-country caps on permanent, employment-based visas.

“Many H-1B visa workers have been in the US for a long time because they’re waiting in line for a green card,” said Julia Gelatt, a senior policy analyst at the Migration Policy Institute. “They tend to deepen their roots in the US by forming relationships, marriages, may be buying and putting down roots in other ways. That can make it really difficult when a layoff occurs.”

Job losses could upend the lives of foreign workers and those of their spouses and children, whose status is dependent on their visas, said Kripa Upadhyay, an immigration attorney at Karr Tuttle Campbell.

“A loss of a job is not just the loss of a job,” she said. “It really has a domino effect.”

Limited Options

Facebook parent Meta Platforms Inc. (11,000 jobs), Amazon (10,000), and Twitter (3,700) are responsible for the biggest layoffs in the tech sector in recent weeks. Other tech firms have also announced downsizing plans, including Stripe Inc., Lyft Inc., Shopify Inc., Coinbase Global Inc., Microsoft Corp., and Netflix Inc.

While it’s not clear how many of those layoffs will include foreign workers on temporary visas, H-1Bs are especially popular in the tech industry. Computer-related occupations accounted for nearly 70% of approved H-1B recipients in fiscal year 2021, according to statistics from US Citizenship and Immigration Services.

Employers’ demand for H-1B visas has reached unprecedented levels in recent years as they struggled to find adequate numbers of workers with science, technology, and engineering skills. USCIS, which administers the visa program, received 483,000 H-1B registrations for fiscal year 2023, a 57% increase from the previous high a year before and well above the annual cap of 85,000 visas. But the status of H-1B workers becomes tenuous in a situation like a layoff when their position is tied to an employer.

If they don’t immediately find new employment, some H-1B workers may consider reclassifying to a different visa, Upadhyay said. For example, if the worker’s spouse holds a valid H-1B visa, he or she could switch to an H-4 dependent visa and obtain work authorization. Laid-off workers could also convert their status to a student visa and attend graduate school in order to remain in the US, although that would mean pausing a full-time career.

As a last resort, workers could return to their home countries to look for another position in the US. However, doing so would likely come with added delays at US consular offices abroad, where visa applicants could wait up to a year or more before securing an interview appointment.

Chilling Effect

Obstacles like the 60-day window for securing new visa sponsorship—which was added via a 2016 regulation—stifle earnings over time by limiting worker choices, said Sam Peak, a policy analyst at Americans for Prosperity who specializes in immigration and labor issues. While a typical US worker could rely on savings after a layoff until he or she finds the right position, the brief window to find new employment places an undue burden on foreign workers and forces them to take the first job available, he said.

“All sorts of people have spells of unemployment,” Peak said. “It’s not fair and it’s not productive either.”

For those workers with hopes of securing a green card, a job loss also could add to their wait time depending on where they are in the application process, said Ali Brodie, a partner at Fox Rothschild LLP.

For example, green card seekers with an approved I-140 petition, a mandatory step in the employment-based immigration process, can change jobs without having it affect the date they can receive a green card. But applicants who are laid off in the early stages of the process not only have to find a new job, but also a new employer willing to sponsor them for a green card.

“That’s sometimes a big ask when you’re a new hire,” she said.

While peer countries like Canada and the United Kingdom in recent years have created new visa categories to attract foreign talent, proposals to reduce barriers to employment-based immigration have been stymied in Congress. Even if most workers successfully find new positions, the wave of layoffs highlights the instability that foreign workers can face in the US, Brodie said.

“Is this going to cause a chilling effect for the tech sector by making it less attractive to high-skilled, highly-talented foreign workers?” she asked. “Will it steer these foreign workers away from America to other countries? That’s the question we have to ask.”

‘Pockets of Hiring’

These workers could be more attractive because they’ve already been counted against annual H-1B visa quotas, and so potential employers wouldn’t have to enter a lottery to be able to sponsor their visas and hire them.

But they will likely have to broaden their job searches and consider tech jobs in new industries or geographic locations, as many foreign tech workers did during the Great Recession, said William Stock, a partner at Klasko Immigration Law Partners LLP.

“Maybe you do data analytics for a manufacturing company in Iowa instead of working in the Bay Area,” he said. “There are many opportunities these folks will have. What we found in 2008 was that there was a fair amount of job churn.”

A shortage of science, technology, engineering, and mathematics talent across the economy means there are still opportunities for laid-off H-1B workers despite the contraction in the tech industry, said Chad Ellsworth, a partner at Fragomen, Del Rey, Bernsen & Loewy LLP.

“There are pockets of hiring still happening,” he said. “There’s a real opportunity for some startups to get talent that they might otherwise not have been able to obtain.”

To contact the reporter on this story: Andrew Kreighbaum in Washington at akreighbaum@bloombergindustrygroup.com

To contact the editor responsible for this story: Laura D. Francis at lfrancis@bloomberglaw.com; Rebekah Mintzer at rmintzer@bloombergindustry.com