Since his entrance into the Oval office, president Joe Biden is overturning many Trump administration’s key decisions. Trump’s policies regarding immigration, climate change, healthcare, etc., were undoubtedly controversial. His right-wing ideologies of white supremacy were evident from his choices. Joe Biden is working day in and day out to undo the shortcomings of the former President. He has rejoined the Paris climate convention, stopped the ban on travel from Muslim countries, and decided to restart aid to Palestine in the past couple of days.
On 14th January, Donald Trump announced the final wage rule. This rule essentially raises the minimum wages of foreign workers on H-1B and E-3 visas. This will ensure low priced foreign labor does not undercut their US counterparts. Joe Biden recently announced that this Minimum wage rule would not be enforced in the upcoming visa lottery session. The March – April session of the visa lottery will be held as per usual. Ninety days of extra time has been allotted to analyze the full effects of this new rule.
The final wage rule and what it means for US immigrants
The Trump administration was keen on protecting US workers from low paying employers. US Department of Labor announced that the new rule would protect domestic and immigrant workers from low paying employers. As immigrant foreign labor tends to be cheaper, US nationals often have to agree on lower wages or get replaced. The minimum wage rules would increase the lower limit of wages employers in the USA pay their workers. This could make immigrant labor as costly as domestic labor, and employers would lose their bias. However, the new government of Joe Biden wants to further analyze its impacts on the entire labor market before implementing it.
Foreign workers on H-1B, H-1B1, and E-3 visas will fall under the new minimum wage regulation. The higher minimum wage will make sure workers in the United States are not exploited by their employers. The H-1B visa applies to most foreign immigrant workers in tech-based corporations. If they are hired at low wages, ultimately, US graduates will not find high paying jobs. This is the basic argument behind the new wage policy. How the market, employers, and workers will react to this will be visible in time. It may incentivize US companies to hire less due to high minimum wages, which ultimately will lead to lower employment levels. This might reduce immigration altogether, which has always been an aim of Donald Trump.
A temporary halt and reconsideration of Trumps minimum wage rules
The minimum wage rule that was to take effect from 15th March has now been postponed until 15th May by the new government. US department of labor has said they need more time to review law and economic policy-related issues. The H-1B lottery process will be long done before 15th May, and therefore the rule will not be applicable for it. The applications will begin in March, and the lottery is held during April. This will fall in the window between the delays of the new minimum wage rule.
This comes as good news to both tech companies and medical research institutions who will be most affected by the minimum wage. The higher wages would have made entry-level hiring more costly. Many people on the H-1B visa are international students who have completed the Optional Training Program. Higher wages would mean everyone who will look for jobs won’t be able to secure one. In the absence of the policy, hiring would be more in the US labor market, especially for skilled white-collar jobs. Due to the pandemic, unemployment is high, and the job market does not look very optimistic. Hence it might not be the right time to revise minimum wages.
The rule released on 14th January saw a revision and reduction of percentage hike below the recommended levels of October. The rule was supposed to increase H-1B holders’ entry-level wages by 35%; however, such a steep rise is no longer anticipated. The rule was to be applicable majorly on entry-level workers of four levels belonging to technical fields of work. Only in May we will get to know about the final revisions.
No minimum wages for this filing season
The recent shift of power in the USA will lead to many changes in the style of governance. The anti-immigration policies favoring only US citizens will most likely be reviewed again by the Democrats. The minimum wage rule, which brings US citizens and immigrants at par the pay scale, might not be as good as it looks on paper. The rule announced by Trump was to take effect from 15th March just in time for this lottery season. However, Biden has recently put a hold on the new policy until May, well after the season is over.
The rule also nudged companies to hire US workers rather than H-1B, H-1B1, or E-3 visa holders. Such a “protectionist” policy towards US citizens would bring down the quality of the workforce. Immigrants have always been an essential part of driving the thriving US economy. Trump’s policy completely undermines their efforts and is not aligned with the virtues of the United States. The efforts to protect US workers from cheap labor should not hurt immigrant workers in the USA.
Biden has repealed many policies signed by the previous government in just a matter of days. His ambitions for the country are in no way aligned with that of his predecessor. He has also removed the ban on a work visa for H1-B spouses. The term of this President will undoubtedly be more in favor of the interests of immigrants. Donald Trump’s policies, which aimed to curb immigration at large, will now cease to exist. Post pandemic, the United States of America wants to welcome more immigrants into their country in the hopes of reviving their economy.