Published: Thu, April 20, 2017
Money | By Oscar Reynolds

Trump signs order for firms to 'Buy American, Hire American'

Trump signs order for firms to 'Buy American, Hire American'

Trump signed a "Buy American, Hire American" executive order on Tuesday, promising to protect USA workers by overhauling the H-1B visa program that is used mainly by Indian engineers and developers.

Industry body Nasscom today warned that the US' move to replace the lottery system for issuing H-1B work visas with a merit-based approach could have "unintended consequences" even as it sought to downplay any immediate impact on IT companies this year. He signed the directive at Snap-on a state he narrowly carried in November on the strength of support from white, working-class voters.

Amid reportedly increasing number of job queries back home by US-based Indians since Donald Trump's election as the new President, Indian IT industry is abuzz with concerns about the latest H-1B policy changes and their impact on Indian professionals overseas. He campaigned on the promise of returning manufacturing jobs that have been lost in Upper Midwest states. This, we believe, in the long run, will have much more adverse consequences in the USA economy because it will prevent businesses from adopting technology, it will slow down the innovation engine, it will have to some extent the reverse impact in India.

The senior official said the end result of how the system now works is that foreign workers are often brought in at less pay to replace American workers, "violating the principle of the program".

The order targets the H1-B visa program, which allows USA companies to employ graduate level workers in specialty occupations like IT, engineering, mathematics and science. Agencies have also been asked to suggest changes so that the H-1B visas are granted to the most-skilled or highest-paid applicants.

"The policy of our government", Trump declared, "is to aggressively promote and use American-made goods". This will stop around 30-40% of IT workers from getting a work visa to enter in the US. The waivers could be renegotiated or revoked if they are not perceived as benefiting the United States.

The Republican travelled to Wisconsin on Tuesday and signed the order at a tool factory in the hometown of White House chief of staff Reince Preibus. Trump changed his position on both issues in interviews last week.

What is the H-1B visa programme? The H1-B and L1 work visas are majorly used by Indian IT professionals. "No one can compete with American workers when they're given a fair and level playing field, which has not happened for decades", Trump said. Many Trump-branded products, such as clothing, are made overseas. His businesses also have hired foreign workers, including at his Palm Beach, Fla., club.

The Australian visa programme - 457 visa - is used to employ skilled foreign workers.

Potential changes could be administrative or legislative and could include higher fees for the visas, changing the wage scale for the program or other initiatives. The staffing companies then sell their services to corporate clients.

Trump has said he would like to reform the United States immigration system, including the H1-B visas, but has so far focused most of his attention on cracking down on illegal immigration, with greater immigration enforcement and a proposed border wall with Mexico. USA workers are sometimes asked to train their replacements to qualify for severance packages.

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