Despite White House Clarification on H-1B Visas, Confusion Grows Among IT Companies

The White House has belatedly attempted to address concerns over the increase in professional (H-1B) visa fees, but confusion among U.S. IT companies is only growing. Some experts warn that the uncertainty caused by this measure could disrupt overseas projects and weaken the United States' position in the competition with China in artificial intelligence (AI).

AFP Yonhap News

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On September 19 (local time), President Donald Trump signed a proclamation drastically raising the H-1B visa fee to $100,000 per person-100 times the previous amount (approximately 140 million Korean won). The H-1B visa allows U.S. companies to hire highly skilled workers such as scientists, engineers, and programmers. The basic duration of stay is three years, with the possibility of extending up to six years. Holders can also apply for permanent residency.

Immediately after President Trump signed the proclamation, Amazon and Microsoft issued urgent directives to their employees, advising H-1B holders not to leave the United States until the regulations become clear. Employees already abroad were instructed to return to the U.S. before the effective date. According to data from the Department of Homeland Security, these two companies alone were approved for more than 15,000 H-1B visas in the most recent fiscal year.

The situation on the ground became so chaotic that White House spokesperson Karoline Leavitt clarified on September 20 that the fee would apply only to new applicants, not to current holders or those renewing their visas. Previously, Secretary of Commerce Howard Lutnick had described the fee as an "annual cost," leading many to believe that even current holders and those renewing would have to pay $100,000. The White House's clarification came in response to this confusion.

However, the inconsistent policies of the Trump administration are said to be further increasing confusion on the ground. The New York Times reported on September 21, "This measure has caused confusion due to unclear regulations and enforcement," adding, "Many are checking the White House's social media accounts in real time, waiting for new guidance."

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There are also concerns that the United States, which is competing with China for AI supremacy, could actually fall behind due to this measure. If companies seek to avoid the fee burden by establishing overseas research centers instead of U.S.-based projects, or by relocating parts of their technology development abroad, this could be detrimental to the U.S. AI and advanced technology ecosystem in the long term.

Adam Kovacevich, CEO of the Chamber of Progress, warned in the New York Times, "Now companies will have to completely reconsider their H-1B strategies," adding, "This could be a major obstacle in competing with China for AI talent." Garry Tan, CEO of startup incubator Y Combinator, also criticized, "President Trump's decision will cripple startups and hand a huge gift to overseas tech hubs like Vancouver and Toronto," adding, "In the midst of the AI supremacy race, it's essentially telling innovators in the U.S. to work elsewhere."

The venture capital (VC) industry is pushing back, saying, "Startups simply cannot afford this." Investor Alan Patricof pointed out, "Not a single company I've invested in can afford this cost."

In reality, the financial burden on companies is expected to increase. According to statistics from U.S. Citizenship and Immigration Services (USCIS), 141,000 new H-1B visas were issued last year. The Financial Times estimated that if the same number is issued next year, employers will have to pay a total of $14 billion (approximately 20 trillion Korean won) annually, at $100,000 per visa.

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