Firms to bear $100 bn losses due to Trump’s work visa ban: report

American think tank report claims that President Donald Trump’s ban on skilled immigrant visa, which prevented 200,000 people from coming to the US, cost firms about $100 billion losses.

On June 22, 2020, Trump signed an Executive Order, which limit the number of employment-based visas the U.S. for the rest of 2020. Many in the tech industry, who come to the US on the temporary H-1B or L-1 visas.

Meanwhile, the spouses of foreign nationalities, already working in the United States, have also been denied entry under the ban.

The purpose of the order was to protect American workers during the coronavirus pandemic, according to the Trump administration.

As per the research by Brookings, the move cost Fortune 500 companies $100 billion in losses based on their valuation before it happened.

The market value of the firms in their sample dropped by 0.45 percent after the executive order. The report stets, “Our results are particularly pronounced for firms that had maintained or increased their reliance on skilled immigrant workers over the prior years.”

The report added: “While there may be such long-run adjustments that firms can make when access to skilled labour supply is abruptly constrained, we document that there is a significant short-run negative impact.

Brookings stated that that ban plausibly eroded valuation to the tune of 100 billion dollars for the firms in our sample.”

The joint rule from the U.S. Department of Labor and Department of Homeland Security further tightening H-1B visa by significantly increase the minimum wages companies must pay to workers.

The administration says it brought in the measures to protect American jobs during the coronavirus pandemic.

The rule, which takes effect in early December, will likely face criticism from trade groups such as the U.S. Chamber of Commerce, who say the H-1B program is necessary because of a shortage of skilled American workers.

More than two-thirds of H-1B visa holders come from India, and they are disproportionately employed by tech firms, according to government statistics.