Trump’s $100,000 H-1B fee could reshape high-skill immigration and the US research pipeline

President Donald Trump on Friday announced a proclamation that would levy a $100,000 fee on all new H-1B visa applications, while reserving the right to grant exemptions for certain employers. The White House described the move as a way to curb abuse of the program and to ensure that high-skill immigration supports American innovation and wages. Critics warned the plan could slow scientific research and long-term economic growth by narrowing the pool of foreign specialists available to U.S. firms.

The H-1B visa covers workers in specialty occupations, typically requiring at least a bachelor’s degree. The private-sector cap is 85,000 visas annually, with 20,000 of them reserved for workers who hold a master’s degree or higher from a U.S. institution. Universities, nonprofits and many government research agencies are exempt from the cap. Demand for private-sector visas routinely outstrips supply. In 2023, about 446,000 people sought H-1B visas, compared with 85,000 slots, with applicants entered into a lottery when applications exceed the cap.

Bloomberg’s reporting shows how the program has been used by outsourcing firms. In 2023, about 40 percent of all H-1B visas went to staffing and outsourcing companies, a pattern critics say channels visas toward lower-wage labor rather than highly specialized talent. The new $100,000 fee would likely deter routine hires while leaving room for a select few extraordinarily skilled individuals whose employers can shoulder the cost. Still, the policy does not guarantee that those hires will be “rare” in practice, since many roles that require advanced skills remain in high demand.

The plan raises questions about overall supply and access for research institutions. Because the fee applies to new petitions, universities and nonprofits—often funded with limited budgets—could struggle to sponsor foreign researchers. With broader pressures on federal science funding and visa policy, some researchers worry the policy could dampen the United States’ science and technology leadership by pushing talent abroad or delaying projects.

Supporters argue high-skill immigration boosts innovation and wages for American workers. Economists have found that higher H-1B caps correlate with more patents and new products, and that cities with more H-1B holders see wage gains for native-born workers. The presence of skilled labor can attract investment, and multinational firms often expand operations where they can access top talent. A 2015 study found wage gains for native-born workers in municipalities that increased H-1B holders, suggesting a positive national impact on living standards.

There are better ways to address the program’s shortcomings than a blanket $100,000 fee. For example, some proposals would allocate visas to the 85,000 applicants who are offered the highest-paying jobs, rather than by random lottery, or adjust criteria to prioritize truly exceptional talent. Critics say the proposed fee would raise costs for research and development while tilting the playing field toward those with political connections or exemptions.

The policy fits within a broader Trump administration approach to immigration and may amplify debates over how the United States should balance protecting native workers with maintaining a competitive knowledge economy. As research on the economics of immigration suggests, reducing high-skill immigration could undermine the long-run growth prospects of American industry and hinder the development of the next generation of leaders in science and technology.