H-1B visas usage now led by banks and telecoms rather than Silicon Valley companies

Time of India

17 hours ago

H-1B visas: The H-1B visa shift is rewriting the rules of America's work‑visa landscape as non‑tech giants like banks and telecom firms now lead sponsorship, overtaking Silicon Valley . New data reveals that nearly half of the 85,000 annual H-1B visas are being granted via staffing and outsourcing agencies, reshaping the program's original intent.
While fintech and telecom companies increasingly rely on foreign talent, concerns are mounting over the impact on American workers, potential wage suppression, and lottery loopholes.
As the H-1B landscape evolves, the shift raises questions about fairness, program transparency, and whether reforms are needed to protect U.S. labor. Stay tuned as the system adapts to a broader corporate footprint—and intensifying scrutiny.
What is H-1B visa?
The H-1B visa is a non-immigrant visa issued by the United States that allows U.S. companies to employ foreign workers in specialty occupations that require theoretical or technical expertise. These fields typically include IT, engineering, finance, medicine, and academia.
Key points about the H-1B visa:
Eligibility: The job must require at least a bachelor's degree or equivalent, and the applicant must have the necessary qualifications.
Employer-sponsored: A U.S. employer must petition on behalf of the foreign worker.
Validity: Initially granted for three years, and can be extended up to six years (or more under certain conditions).
Annual cap: There is an annual limit of 65,000 visas, with an additional 20,000 reserved for individuals with a U.S. master's degree or higher.
Path to green card: It can serve as a stepping stone to permanent residency (green card) in the U.S.
From Silicon Valley to Wall Street: How outsourcing firms are redefining the H-1B program
America's H-1B visa program has long been a key component of Silicon Valley's innovation-driven strategy, drawing in top-tier international talent in science and engineering. However, according to fresh data that Bloomberg News was able to obtain, a broader range of industries, such as banks and telecom firms, are among the biggest users of the program.
This is frequently the case through outsourcing and staffing firms that obtain almost half of the 85,000 new H-1B visas that are granted each year. By serving as visa intermediaries, these businesses are changing the goal of the H-1B visa program and, in the process, posing concerns about how it will affect American workers' earnings.
Bloomberg's analysis, which included new H-1B employment from May 2020 to May 2024, found that Citigroup Inc. outpaced tech titans like Nvidia, Oracle, and Qualcomm by adding 3,000 H-1B workers. However, around two-thirds of Citi's H-1B employees were IT contractors hired through staffing and outsourcing firms, unlike the highly qualified researchers and engineers in software companies.
These employees, sometimes said to be paid much less than direct hiring, are part of an increasing trend in which non-tech enterprises use the visa program to obtain cheaper labor. In an interview with Bloomberg, a senior economist at the W.E. Upjohn Institute for Employment Research, Susan Houseman stated, "This is just the beginning."
"The offshoring of service jobs has not received enough attention in the national debate about the United States' reliance on imported goods—not because it doesn't occur or isn't significant, but rather because we don't have good data on it."
Frauds in H-1B visas
Congress created the H-1B visa in 1990 to increase American competitiveness in developing technology sectors. However, it has now grown so popular that there are yearly lottery draws for the few visas that are still available. This system has been abused by outsourcing and staffing companies acting as intermediaries for visas. These companies let businesses outsource back-office tasks or supply lower-level IT personnel.
According to Bloomberg's data, which was acquired through a Freedom of Information Act lawsuit against the Department of Homeland Security, these visa intermediaries are frequently used by large U.S. corporations such as Capital One Financial Corp., Verizon Communications Inc., AT&T Inc., and Walmart Inc. To improve their chances, some intermediaries used a tactic known as "multiple registration" to influence the visa lottery until recently.
This involved submitting many applications for the same worker. In a 2023 report, the U.S. Citizenship and Immigration Services (USCIS) declared this technique fraudulent and changed the rules to stop it last year.
According to Bloomberg's investigation, USCIS also highlighted thirteen staffing companies that had used such tactics, and at least six of them sent personnel to Capital One. The largest percentage of the top 10 corporations examined, more than half of Capital One's 905 H-1B contract employees across the four years, were associated with multiple registrations. 361 of the 429 staffing companies that Capital One used had multiple registrations.
A Capital One representative responded to Bloomberg by saying that the business would "take appropriate action" if there were any government charges of visa fraud by its contractors but that it was unaware of such complaints. AT&T, Walmart, and USAA declined to comment, although Verizon and Capital One stressed that they demand suppliers to do the same.
The impact on salaries of the change in H-1B visas
There are also notable income gaps, according to the data. Even for comparable responsibilities, H-1B contractors are frequently paid far less than direct hiring. Even after adjusting for age and education, more than 75% of the approximately 5,300 H-1B "software developers" employed between 2020 and 2024 were contractors, earning about $48,000 less on average than direct recruits, according to Bloomberg's research of the top 10 end clients.
The Department of Labor's minimum wage was paid to one out of every three contractors. Information Services Group Inc. Chief AI Officer Steve Hall told Bloomberg that contractors doing less technical tasks, such as communicating with overseas teams and U.S. clients, account for a portion of the salary disparity. Critics counter that using visa intermediaries distorts the original aim of the H-1B program.
Labor proponents argue that it undercuts American workers, tilts the labor market in favor of employers, and leaves a vulnerable workforce with fewer protections. The absence of thorough statistics on offshored employment and pre-existing H-1B contractors makes evaluating the program's overall impact more difficult.
Houseman pointed out that although outsourcing service jobs is poorly understood, it has important ramifications for the American labor market. The H-1B program's influence on the workforce is still up for question, as businesses from various industries increasingly use visa middlemen.