H1B visa approvals for Indian IT firms have decreased by 56%, leading to an increase in the hiring of American workers.

Over recent years, Indian IT companies have notably decreased their dependence on H-1B visas. Data from the Economic Times (ET) reveals a 56% reduction in H-1B visa usage by the top seven Indian IT firms over the past eight years. Meanwhile, American tech giants like Amazon and Google have increased their H-1B visa usage.

Factors Behind the Decline Several reasons have driven this reduction in reliance on H-1B visas. The Trump administration's stringent immigration policies and high denial rates led Indian IT companies to increase local hiring in the US. Additionally, industry trends towards digital services, such as cloud computing and AI, which require fewer employees, have influenced this shift.

Data on Visa Usage

According to the National Foundation for American Policy (NFAP), the number of approved H-1B visa petitions for initial employment from the top seven Indian IT companies fell from 15,166 in fiscal year 2015 to 6,732 in 2023. Tata Consultancy Services experienced a 75% decline in approvals from FY15, with Infosys, Wipro, and HCL America also showing significant decreases.

Strategic Hiring ChangesExperts attribute this shift to Indian IT companies expanding their domestic workforce in the US, thus reducing the need for H-1B visas. This strategy to localize operations and lessen dependence on foreign workers includes significant hiring efforts in the US by companies like Infosys, replicating their Indian talent model locally.

Impact of Cost and Policy Changes Recent US government measures to tighten work visa regulations have also affected H-1B visa usage. The US Citizenship and Immigration Services (USCIS) increased both the H-1B registration and application fees, making the process more expensive. Additionally, a new ‘beneficiary-centric’ approach aimed at reducing fraud has led to fewer eligible registrations.

Effects on Indian Tech Workers

Phil Fersht, chief analyst at HFS Research, pointed out that the high cost of living in the US and attractive job opportunities in India have made US relocation less appealing for Indian tech workers. This trend is reflected in the reduced need to sponsor visas for junior or mid-level staff.

American Big Tech Companies' Trend Conversely, American Big Tech companies like Amazon and Google have increased their H-1B visa usage. Amazon rose from tenth in approved H-1B visas for initial employment in FY 2015 to the top user in FY 2023, with Google also climbing in the rankings, showing a different trend compared to Indian IT companies.