H-1B visa, green card system flawed, US needs to hire Americans: Lutnick

US to overhaul H-1B and green card system; Trump administration eyes wage-based visa selection and new $5m 'gold card' residency scheme

The H-1B visa, much loved by Indian techies, and the US green card are set for a major shake-up. United States Commerce Secretary Howard Lutnick on Tuesday confirmed that the administration is preparing to alter key parts of the immigration system.

 

“The current H-1B visa system is a scam that lets foreign workers fill American job opportunities,” Lutnick posted on X, adding, “Now is the time to hire American.”

 

Speaking to Fox News hours earlier, he said he was directly involved in the redesign of the visa programme.

 

Changes to the green card system

 

Lutnick also said changes were on the way for the green card system. “We give green cards. The average American makes $75,000 a year, and the average green card recipient $66,000. So we're taking the bottom quartile. Why are we doing that?” he asked.

 

 

He added that a new ‘gold card’ would be created. “That's the gold card that's coming. And that's we're gonna start picking the best people to come into this country. It's time for that to change,” said Lutnick.

 

Under the proposal, foreigners who invest $5 million in the US would be offered permanent residency.

 

What the H-1B visa is

 

An H-1B visa is a US non-immigrant visa that allows foreign workers to take up jobs in “speciality occupations” requiring a bachelor’s degree or equivalent knowledge. It requires sponsorship from a US employer, is capped annually, and operates on a lottery system due to heavy demand. The visa is valid for up to six years and is heavily used in IT, engineering and healthcare.

 

A new wage-based system

 

On August 8, the US Office of Information and Regulatory Affairs approved a proposal to change H-1B visa rules. The draft, titled “Weighted Selection Process for Registrants and Petitioners Seeking to File Cap-Subject H-1B Petitions,” has been passed to US Citizenship and Immigration Services (USCIS) and will soon be released for public comment.

 

“While the text of the proposed rule has not yet been released, the proposal could potentially replace the current random H-1B lottery system with a wage-based selection process,” said Sheela Murthy, president and CEO of the Murthy Law Firm.

 

The idea is a revival of a move from Donald Trump’s first term. “In January 2021, near the end of Trump’s first term in office, he unsuccessfully attempted to implement a rule that would have tied the H-1B lottery selection process to the wage level. Presumably, the new rule will be similar to the 2021 rule,” said Joel Yanovich, attorney at the Murthy Law Firm.

 

How the lottery works today

 

< The annual H-1B cap is 85,000 visas

< 65,000 are for general applicants

< 20,000 are reserved for those with a US master’s degree or higher

 

When applications exceed the cap, USCIS runs a computerised draw to decide who proceeds.

 

“If the rule is substantially similar to the 2021 rule, cap-subject H-1B petitions filed for entry-level positions would likely have next-to-no chance of being selected. This would undoubtedly harm foreign nationals who are recent graduates,” said Yanovich.

 

The four wage tiers

 

The tiers are based on the US Department of Labor’s prevailing wage levels for a given job and location:

 

Level 1: Entry-level pay for the position

Level 2: Workers with some experience

Level 3: Experienced workers with advanced skills

Level 4: Highly specialised, senior workers

 

Under the 2021 plan, level 4 roles would be selected first, with lower levels following.

 

Legal route ahead

 

“The rule would not need congressional approval. But, if the rule does not comply with the framework of the H-1B programme as set by Congress in the statute that created it, the rule could be struck down by a federal court,” said Yanovich.

 

Murthy added, “Without access to the actual rule text and given the multiple steps required for finalisation, it remains uncertain whether, when, or in what form these changes might be implemented.”

 

Indian professionals most affected 

 

Indian technology professionals are among the biggest beneficiaries of the H-1B programme. Over the last decade they have consistently received 60 to 70 per cent of all visas issued each year. In financial year 2023, Indians accounted for 72.3 per cent of all approved petitions, around 279,400 out of 386,300 approvals. In 2024, the share was 71 per cent, or about 283,400 out of 399,400 approvals. Owing to the sheer number of Indians applying for this programme, any change would translate into massive impact on Indians.