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The amended rules for the H-1B visa programme, which is widely used for technology workers, is receiving cautious praise from Silicon Valley.
The visa programme will give greater importance to people with post-graduate degrees from the United States universities, under a final rule published in January by the Department of Homeland Security.
The United States visa programme admits about 85,000 foreign nationals each year. Nearly three out of four H-1B visa holders are Indian citizens, according to an official U.S. report.
Under the new rule, "U.S. employers seeking to employ foreign workers with a U.S. master's or higher degree will have a greater chance of selection in the H-1B lottery," said Francis Cissna, director of the U.S. Citizenship and Immigration Services, in announcing the change on January 30.
The changes come amid surging demand for high-skill employees and tech industry pleading for more immigrants to fill key skilled positions. It is also in consequence of concerns that the programme has been exploited by some tech giants and outsourcing firms to depress wages and displace U.S. employees.
"The changes are, on the whole, a positive step in the right direction," said Todd Schulte of the immigration reform group FWD.us backed by Facebook founder Mark Zuckerberg, Microsoft founder Bill Gates and others in the industry.
Ed Black of the Computer & Communications Industry Association, which represents several major tech firms, said the program has not always been administered as well as it could have been.
"We are hopeful something in the newly announced revisions will improve efficiency, but it's too soon to say what the impact will be in practice," Black said.
The H-1B program applies to employers seeking to hire non-immigrant aliens as workers in specialty occupations or as fashion models of distinguished merit and ability.
Ron Hira, a Howard University political scientist who has followed the visa program for two decades, said it has been exploited by some large tech companies and outsourcing firms to keep wages down and in some cases displace American employees.
Hira said the visas have not been allocated to the "most pressing needs" of the labor market and that "the typical H-1B employee is working in a back office through an outsourcer." He said that the reform "inches us a little closet to a better quality pool, but it's still not selecting the 'best and brightest' - you could reform it much better."
Hira said the system has been disappointing up to now because of large outsourcing firms that flood the system with thousands of applications, and some Silicon valley firms that use it to keep wages down.
The U.S. Labour Department complaint alleged that Oracle discriminated against some Americans by bringing in large numbers of H-1B visa holders, who were paid less than U.S. nationals.
The new DHS rule reverses the order of two lotteries for H-1B visas, by selecting the first 65,000 from the pool of all applications, and subsequently choosing 20,000 with advances degrees.
The new rule will see an increase of some 5,000, or 16 percent, for advanced degree-holders, according to officials.
Hira said this potentially changes the mix of visa holders to positions with higher pay and skill levels.
William Kerr, a Harvard professor who heads the university's Future of Work initiative, agreed the changes could slightly shift the mix of those receiving H-1B visas to bring in more people with advanced skills. "It's a modest change in a system in a need of substantial reworking, but I support the change," he said.
Robert Atkinson, president of the Information Technology and Innovation Foundation, a think tank focused on the sector, said the changes should be viewed in the context of Trump administration rhetoric about shutting out foreigners and hiring more Americans.
"People were talking about shutting down this program and making it hard for companies to use (visa holders) at all, so it could have been a lot worse," Atkinson said.
The reform is a "reasonable compromise," Atkinson said.
The change, he said, "sends a nice message to foreigners who have been dropping their enrollment in U.S. universities and who were feeling uncertainty about Trump was going to do."