Equity Why the new H-1B policy helps outsourcers, not startups
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Oct 8, 2025 Jeremy Neufeld, Director of Immigration Policy at the Institute for Progress, dives deep into the drastic changes to the H-1B visa program. He reveals how a massive fee hike could hinder startups while inadvertently favoring outsourcers. Jeremy discusses the loophole allowing 80% of applicants to bypass the fee and critiques how the new wage-based lottery system could unfairly prioritize seasoned acupuncturists over fresh AI PhD graduates. The conversation uncovers the uncertainties facing universities and the potential effects on innovation in the tech industry.
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H‑1B Is Two Different Talent Streams
- The H-1B is the main high-skilled immigration path with about 85,000 private-sector slots and ~50,000 uncapped research slots annually.
- It brings top researchers and tech founders but also a second stream of mid-level contracting workers, creating mixed outcomes.
Why Indian Applicants Dominate H‑1B Numbers
- India accounts for about 70% of H-1B petitions largely because of long green card backlogs due to per-country caps.
- Many Indians renew H-1Bs for decades while waiting for green cards, which inflates H-1B share.
Proclamation Aims Sound Good But Falter In Detail
- The proclamation added a $100,000 fee on new entrants, ordered wage-priority in the lottery, and asked DOL to police undercutting wages.
- Good intentions clash with poor execution and legal/implementation gaps.