US tech shares hold steady after Trump unveils USD 100,000 H-1B visa fee

US tech shares were little changed on Monday after President Donald Trump announced a USD 100,000 one-time fee for H-1B visas, part of his immigration crackdown that has raised concerns about higher labor costs and limited access to skilled workers.

The H-1B program allows US employers to hire foreign workers in specialty fields such as technology and engineering, and higher fees threaten to raise labor costs for tech companies that depend heavily on this talent pipeline.

Over 70% of these visas went to Indian nationals last year, US data showed. During Trump’s first term, the administration tightened visa approvals and raised scrutiny of applications, moves that drew lawsuits from industry groups.

Analysts said the impact should be moderate, given that the fees apply only to new applications, but warned that a constrained supply of skilled workers in the US may push wages higher and squeeze margins.

Amazon, Google parent Alphabet, Meta, and Microsoft are consistently among the top corporate sponsors of H-1B visas, data shows, underscoring their dependence on foreign engineers and developers to fuel growth in areas such as cloud computing and artificial intelligence.

Shares of Cognizant Technology Solutions, JP Morgan, and Intel, which rank among the biggest sponsors of H-1B visas, were trading between down 1.7% and up 1.9%.

“The H1B fee will constrain talent supply in the US, which in turn will drive up demand for locals or green card holders. IT firms will have to pay these employees more or risk losing them,” Jefferies analysts said in a note.

“The talent supply crunch will drive up onsite wages, which could drag profits by 4-13%.”

Industry lobby groups, including India’s Nasscom and the US Chamber of Commerce, are expected to push back, arguing the fees will hurt innovation and discourage global talent from seeking jobs in the United States, analysts said.

INDIAN IT STOCKS HIT

Indian IT workers make up the bulk of H-1B applicants, and while Indian IT companies have long benefited from US work visa programs, they now face the prospect of higher costs and slower revenue growth.

Indian IT stocks slid on Monday, with the tech sub-index dropping nearly 3% and dragging the broader Nifty 50 index down.

US-listed shares of Infosys and Wipro were up 1% and down 0.5% respectively.

“We believe this will essentially shut out new H-1B visas except in extreme cases for Indian IT companies, as USD100K increment is nearly double their median salaries and doesn’t make economic sense,” Ambit Capital analysts said.

(Reporting by Samuel Indyk in London and Akash Sriram in Bengaluru; Editing by Amanda Cooper and Anil D’Silva)