Outsourcing the American Dream: Staffing Firms Rewrite the Visa Script

Image Source: The Economic Times

The US H-1B visa landscape is seeing a quiet but seismic shift. What was the exclusive domain of Silicon Valley's technorati is increasingly being remade by banks, telecom oligopolies, and retail chains—often through third-party employment agencies.

Emerging Trends

Citigroup, Capital One, AT&T, and Walmart surpassed fintech titans Nvidia and Oracle in H-1B hiring between 2020 and 2024.

These are mostly IT contractors that are hired via outsourcing agencies and not employed directly.

Structural Changes

Nearly half of the 85,000 per year H-1B visas are now in the hands of staffing firms as middlemen.

These intermediaries tend to offer lower wages than direct employment, thereby sparking doubts about wage compression and displacement.

Regulatory Highlight

The US Citizenship and Immigration Services had identified various staffing agencies for manipulating the visa lottery by double-registering.

A new beneficiary-focused selection procedure has been implemented to avoid such practices in the 2026 H-1B process.

Broader Implications

The H-1B's original intent to import the world's top technical experts is being undermined.

Economists worry that this movement would accelerate the offshoring of service jobs and create a two-tiered workforce.

Sources: Bloomberg, Financial Express, Economic Times, Times of India, VisaVerge