Are American workers being replaced? Inside the H-1B visa controversy

Following months of controversy, President Donald Trump issued a proclamation in September decrying the systemic abuse of the H-1B visa program, which he said is fueling the “large-scale replacement of American workers” that “has undermined both our economic and national security.”

To address this, Trump instituted a $100,000 fee for companies seeking to obtain an H-1B visa, a move that has been widely criticized by business leaders, especially in the tech industry.

Debate over the program has split both the American public and the GOP, with one side saying the visa holders are poaching American jobs and the other saying it is vital to U.S. competitiveness.

So, what are H-1B visas, and why have they become a political flashpoint?

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What is an H-1B visa?

An H-1B visa is a non-immigrant work visa that allows companies in the U.S. to hire highly-skilled foreign workers in specialty occupations for an initial period of three years, which can be extended to six years.

The U.S. Citizenship and Immigration Services website states that the visas are meant for individuals of “exceptional merit and ability.” Individuals must have at least a bachelor’s degree in a relevant field.

Which industries are the H-1B visas most common in?

By far the industry most heavily utilizing H-1B visas is the tech industry, which accounts for roughly 60% to 70% of all the new applications in recent years.

Other top industries include consulting and professional services, engineering and manufacturing, healthcare and medical research and higher education.

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How many foreign workers hold these visas?

There is no official figure for the number of people currently holding H-1B visas.

There is a yearly cap of 65,000 people who can obtain H-1B visas. The program allows for an additional 20,000 individuals holding master’s degrees or above. Notably, most universities and non-profit research organizations are cap-exempt, further increasing the number of people being approved each year.

The Pew Research Center estimated that about 400,000 H-1B visa applications were approved last year under the Biden administration.

Where do visa holders come from?

Nearly 3 out of every 4, 73%, of H-1B visa holders come from India, according to Pew. The country with the second-highest number of visa holders is China, with 12%. The remaining 15% comes from a mix of other countries, with no single country reaching the 2% threshold.

Who is against H-1B visas?

The H-1B visa program has been criticized on both sides of the political aisle, including from Trump to Sen. Bernie Sanders, I-Vt.

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Critics say the current program has veered away from its original intent to attract top talent to work in the U.S. and instead is being used by employers to import cheap foreign labor, depress wages, and cut out American workers.

Senate Democratic Whip Dick Durbin, D-Ill., and Senate Judiciary Chair Sen. Chuck Grassley, R-Iowa, reintroduced bipartisan legislation in September to reform and close loopholes in the H-1B program to protect American workers and stop the outsourcing of jobs to foreign countries.

On the state level, Florida Republican Gov. Ron DeSantis issued guidance in October to combat the university loophole. DeSantis directed the Florida Board of Governors to end the practice of higher education institutions “importing foreign workers on H-1B visas instead of hiring Americans” by requiring universities to “put American graduates first and ensure taxpayer-funded schools serve the American workforce.”

Who supports H-1B visas?

On the other side of the debate, prominent figures such as Elon Musk have advocated for H-1B visas because the program is essential for the U.S. to maintain its competitive edge.

Shortly before Trump returned to the Oval Office, Musk said, “The reason I’m in America along with so many critical people who built SpaceX, Tesla, and hundreds of other companies that made America strong is because of H1B” and pledged to “go to war” in support of the program.

However, Musk also noted his belief that “the program is broken and needs major reform.”

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He proposed “raising the minimum salary significantly and adding a yearly cost for maintaining the H1B, making it materially more expensive to hire from overseas than domestically.”

Business leaders have said the H-1B program is important in competing with countries such as China, which just recently launched a similar program, called the K-visa, to attract top talent to the country. The program went into effect on Oct. 1.

The H-1B program also has the support of the U.S. Chamber of Commerce.

Are Visa holders taking American jobs away?

On Sept. 19, Trump issued a presidential proclamation titled “Restriction on Entry of Certain Nonimmigrant Workers,” in which he said the H-1B visa program was being “deliberately exploited to replace, rather than supplement, American workers with lower-paid, lower-skilled labor.”

Trump said this abuse has been used by companies to “artificially suppress wages, resulting in a disadvantageous labor market for American citizens, while at the same time making it more difficult to attract and retain the highest skilled subset of temporary workers, with the largest impact seen in critical science, technology, engineering, and math (STEM) fields.”

The president wrote that “the large-scale replacement of American workers through systemic abuse of the program has undermined both our economic and national security.”

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As such, Trump imposed a $100,000 fee, effective Sept. 21, 2025. The restriction will expire one year from the effective date.

Trump also directed his administration to “initiate a rulemaking to prioritize the admission as nonimmigrants of high-skilled and high-paid aliens.”

Meanwhile, another DHS rule will narrow the definition of “specialty occupation” that will allow the department officials to increase worksite compliance inspections before and after an H-1B petition, and require the petitioner’s employer to make the application directly — a move to stop companies from bringing in H-1B immigrants and then contracting them to other companies.

What’s next?

The debate over H-1B visas promises to continue in the coming months and years.

The U.S. Chamber of Commerce has sued the Trump administration to stop its implementation of the $100,000 application requirement, which it says would “make it cost-prohibitive for U.S. employers, especially start-ups and small and midsize businesses, to utilize the H-1B program.”

The lawsuit argues that the new fee is unlawful because it overrides provisions of the Immigration and Nationality Act that govern the H-1B program, including a requirement that fees be based on the costs incurred by the government in processing visas.

The chamber previously warned that restrictions on the H-1B program “have the potential to inflict serious harm upon many American companies.”

The case is currently ongoing. It remains to be seen whether Congress will ultimately weigh in one way or another on the issue.