U.S. technology stocks remained steady Monday after President Donald Trump unveiled a $100,000 one-time fee on new H-1B visa applications. While analysts warned of higher labor costs and tighter access to skilled workers, investors signaled confidence that major tech firms could absorb the financial impact without immediate market disruption.
Market Reaction to Visa Fee
Technology shares showed resilience despite the announcement of Trump’s new H-1B visa fee, which adds a $100,000 surcharge on new applications. The program, widely used by U.S. tech companies to hire engineers and IT specialists, faces a costly adjustment that could limit the entry of global talent.
Shares of major sponsors, including Amazon, Alphabet, Meta, and Microsoft, remained within a narrow range. Analysts noted that while the fee introduces new cost pressures, its impact is expected to be gradual, as it applies only to new applications. Companies appear willing to incur higher costs in the short term.
Dependence of Tech Firms on H-1B Experts
The H-1B program is a significant vehicle for high-skilled foreign nationals to enter the U.S. labor market, particularly in the fields of technology and engineering. More than 70% of the H-1B visas issued recently went to Indian nationals, indicating the growing dependency of American companies on foreign experts.
Statistics show Amazon topped the list of H-1B sponsors with over 10,000 approvals, followed closely by other top firms. These companies rely on foreign engineers and developers to keep growth in strategic areas such as cloud computing, cybersecurity, and artificial intelligence, where local talent is in short supply.
Margin and Wage Pressure
Pundits caution that imposing a visa fee would encourage businesses to pay U.S.-based employees more or risk losing talent to their rivals. Jefferies’ report projected that increased labor costs will cut industry-wide profit by 4–13%. This is likely to hit companies with massive onshore staff bases particularly hard.
However, market analysts note that the greater economic impact may be tempered, as global technology firms tend to average costs across their worldwide hubs. Even as pay increases, talent access remains key, so firms will be willing to tweak but not scale back hiring in general.
Indian IT Firms and Global Pushback
Indian IT companies, which had long been beneficiaries of the H-1B program, are some of the most severely affected. Analysts at Ambit Capital argued that the $100,000 fee effectively excludes new visa petitions for Indian IT firms, given that the surcharge would effectively double the cost of hiring above median salaries.
Indian share markets reflected the fear, with IT stocks dropping nearly 3% and dragging down the broader Nifty 50 index. Industry groups, such as India’s Nasscom and the U.S. Chamber of Commerce, are expected to lobby against the plan, arguing that the action will stifle innovation and deter overseas talent.
A Look Ahead
While the short-term market reaction is one of toughness, longer-term impacts are uncertain. As the cost of hiring rises, American technology companies could lose more jobs offshore, invest in automation, or accelerate sponsorship of green cards to stabilize their workforce. Indian information technology companies are bracing for slower growth and tighter profit margins as costs rise.
The H-1B visa controversy will only intensify, with U.S. and international industry associations disputing the policy’s competitive and economic implications. Meanwhile, markets remain stable, but pressure on companies to invest in skills and keep costs down will intensify.
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