What Does the Wave of Tech Layoffs Mean for Foreign Talent?

Emily Lombardo - Feb 27 2023
Published in: Global Workforce
| Updated Apr 27 2023
A look at highly skilled foreign talent and the H-1B visa problem.

Last November, Meta employees woke up to emails letting them know if they had been “impacted” by the companywide layoffs. Since then, layoffs from tech companies including Google, Amazon, and Dell have swept through the U.S., leaving foreign workers scrambling. According to the data on the website layoffs.fyi, which tracks tech layoffs since COVID-19, there have been over 250,000 layoffs from 1,356 different tech companies. Business Insider India estimates that between 30 and 40% of the employees laid off are Indian nationals, and Kathy Khol, an immigration attorney at Fragomen, estimated for Forbes that 20-30% of workers at Meta, Amazon, Cisco, and Twitter—all which have made dramatic cuts to their workforce—are foreign nationals.  

Most foreign workers in tech are on the H-1B visa, which is an employer-sponsored work visa. Laid-off workers on the H-1B visa have just 60 days to find new a new employer to sponsor their visa. If they can’t find a new job, they have few straightforward options available. While they could change their status to a B-2 (visitor) visa or F-1 (student) visa, most will be forced to leave the U.S. For many foreign tech workers, the ideal immigration path to the U.S. means moving from a company-sponsored H-1B to a company-sponsored green card. However, with the current layoffs, even the employees who kept their jobs will have immigration problems. Google announced the day before its layoffs that it would pause any new Program Electronic Review Management (PERM), with a Google spokesperson saying that other companies are following suit. Filing for a PERM is the first step in the green card application process and the step that keeps foreign talent in the U.S. when their temporary visas have run out. The H-1B was set up as a temporary work visa, so it is only valid for up to six years. It can be extended for one to three years, but only with a PERM filing.  

If other tech companies follow suit, this will have a devastating effect on the foreign workers who want to continue their employment in the U.S. With American tech workers going through layoffs, United States Citizenship and Immigration Services (USCIS) will expect companies to look to hire American workers for job vacancies. To file the PERM application, the employer must prove to the Department of Labor that there are no available U.S. workers who want the job and so the job must be filled by a foreign national. As it pertains to layoffs, filing a PERM requires an employer to notify former workers who were fired in the past six months and evaluate whether they are appropriately qualified for the position.

With this year’s H-1B visa cap already met and the 60-day window for job transfers, many recently laid off foreign tech workers will find themselves in a troubling situation with few options available. Are there options abroad? 

Yes, but it could be complicated. While there are few options for remaining in the U.S. once the H-1B visa is off the table, there is still a way American companies can utilize foreign employees, broadly called “global parking.” This term refers to “parking” or relocating employees to countries where they are authorized to live and work, often because they were unable to obtain a H-1B work visa or their F-1 work authorization is about to expire. This could be a short-term solution if there was a specific visa issue to solve such as waiting for the next year’s H-1B visa lottery, other visa-related issues, etc., or a long-term solution. If the company does not already have an entity in the chosen country, then it will have to establish one via a professional employment organization or an employer of record, a third-party company that takes over all HR-related administration. Global parking could be a shortcut around the admittedly difficult H-1B process for employers looking to retain foreign talent.

While there are other options, will the H-1B process be changing, either due to demand or because of the layoffs?

Unfortunately, it doesn’t look like there will be major changes anytime soon. The Foundation for India and Indian Diaspora Studies appealed to President Biden, Homeland Security, and the USCIS to extend the grace periods for laid off H-1B workers from two months to 12 months, with a petition currently circulating. However, Biden’s State of the Union on 7 February, while sympathetic to those laid off, was silent on the matter of H-1B extensions. Despite the tech layoffs, the rest of the U.S. economy is desperate for foreign talent to plug the many labor shortages, but will these needed workers be able to apply for an appropriate work visa?

Since 2013, companies have put millions into lobbying for immigration reform but little has changed with the H-1B visa for almost 20 years. Currently, U.S. unemployment is 3.4%, the lowest it’s been since 1969, with 260,000 jobs added in December 2022. Without a correction to current visa problems, international talent may be eyeing moves to nearby countries. Canada has welcomed immigrant STEM talent with lucrative permanent residency options, and Mexico has recently unveiled a remote work visa that could attract talent struggling to find stability in the U.S. While Americans aren’t filling the labor gaps in the STEM and tech work markets and companies are campaigning for change, highly skilled immigrant workers hoping to make America their home don’t yet have an easy fix in sight.