New H1-B visa fee may cost 5,500 jobs a month, mostly Indian talent: JP Morgan

JPMorgan warns that Trump's $100,000 H-1B visa fee could slash 5,500 jobs a month, hitting Indian tech workers and US firms relying on skilled foreign talent

The Trump administration’s new $100,000 application fee for H-1B visas could cut immigrant work authorisations by as many as 5,500 each month, according to JPMorgan Chase & Co. economists Abiel Reinhart and Michael Feroli.

 

While the number may seem “fairly small” compared to the overall US labour market, the economists said technology firms and Indian workers would face the most impact, Bloomberg reported.

 

Data show that computer-related roles made up nearly two-thirds of H-1B approvals in FY24, with half of the petitions tied to professional, scientific, and technical services. Around 71 per cent of approved petitions were for Indian nationals.

 

Of the 141,000 H-1B petitions approved for new employment last year, roughly 65,000 were processed abroad. These cases, economists noted, are most vulnerable to the new fee.

 

“If all of them were to stop, it would reduce work authorisation for immigrants by up to 5,500 per month, unless immigrants are able to use other visa categories to get employment,” the economists wrote.     

 

Experts warn of dismantling the system

 

Loujaina Abdelwahed, senior economist at Revelio Labs, said the dramatic fee hike is “effectively equivalent to dismantling the H-1B system”, potentially eliminating up to 140,000 new jobs each year in US companies that depend on foreign talent.

 

Meanwhile, the US labour market has already slowed, with just 29,000 payrolls added monthly on average over the past three months. Federal Reserve Chair Jerome Powell recently described the trend as a “marked slowing” in worker supply and demand, partly due to lower immigration.

 

Bloomberg Economics predicts the fee will push visas toward higher-paying jobs in technology, finance, and healthcare, while squeezing out lower-paid positions in areas such as education.

 

California Attorney General reviews Trump’s H-1B policy

 

California Attorney General Rob Bonta criticised the Trump administration’s decision, saying the fee adds “uncertainty and unpredictability” for businesses that rely on skilled workers.

 

Speaking to Bloomberg News, Bonta warned the move would have an “adverse impact” on California, which depends heavily on the H-1B programme to fuel its tech-driven economy.

 

“So the short answer is, we are looking at it,” said Bonta. “We will assess whether there’s a legal violation. If it’s a policy that we don’t agree with but it’s legally sound, we won’t challenge it. If it’s unlawful, we will.”     

 

Legal challenges under review

 

Bonta, who has previously joined other Democratic attorneys general in challenging Trump-era policies, said his office is examining whether the visa fee violates the Administrative Procedure Act, which requires a proper justification and public notice before new rules are enforced.

 

“You need to have a reasoned justification,” he said. “It can’t be arbitrary, it can’t be capricious… it might be appropriate here, but we’re still looking.”

 

The H-1B visa programme is widely used by tech firms, finance companies, and consulting firms to bring in skilled foreign workers.

 

“We wouldn’t be here without the talent that has come to California on these visas,” Bonta said, stressing that businesses need “certainty” in government policy.