Another Tailwind To Tech Stocks

Upping the H-1B application fee from $4,000 to $100,000 won’t even put a dent in the 13-year Bull Run in tech stocks ($COMPQ).

I would argue that this executive order, signed by the administration, requiring a $100,000 annual fee on new H-1B visa applications for skilled foreign workers, will help tech achieve their earnings goals.

Why?

This is essentially the green light to get rid of every single U.S.-based worker and outsource 100% of the staff to countries that are sometimes even 10% of the United States.

Silicon Valley might as well close down its offices, too; they don’t need that either.

With advent of Zoom video, tech companies are used to meeting online to tackle projects, and this executive order will close entire divisions in the United States.

It could be that an American citizen wanting to work for an X tech company will be redeployed to Africa or Southeast Asia and go through an abroad version of an H-1B visa to get employed.

The workarounds on this one take a millisecond to figure out.

The genesis of this executive order is rooted in social media, with large swaths of it claiming that Indians are monopolizing the H1-B visa by securing over 70% of them.   

My bet is that this will have the opposite effect while shutting down the prospects of stateside American workers even more.

Many companies could go 100% work-from-home, and many already are.

Don’t believe the fear-mongering that this fee could add billions in costs for heavy users, squeezing margins, disrupting hiring, and eroding US leadership in AI and software development.

Any HR department will be able to find a loophole the size of a tractor on this one.

Indian IT outsourcing giants, deeply intertwined with US tech supply chains, bore the brunt: Infosys shares plummeted 4.5%, Wipro fell 3.4%, and Cognizant dropped 4.3% in a single session.

Nasscom, India’s IT lobby, warned of disrupted global operations, potentially redirecting $283 billion in exports away from US clients.

For US tech behemoths, the impact is more insidious but no less profound. Amazon, the top H-1B sponsor with over 12,000 approvals in early 2025, could face $1.2 billion in annual fees if it maintains its pace—equivalent to 0.5% of its operating income.

Microsoft, with 5,000+ H-1B visas, saw shares dip 1.8%, as the fee threatens its Azure AI initiatives reliant on Indian and Chinese coders.

It’s a drop in the ocean type of fee for anyone really “worth” the fee and wants to work in the United States.

Remember that these top-end AI workers are earning in excess of $100 million per year, and this fee is not something that management will even look at.

For all the entry-level jobs that are hoped to open up, sorry, you’re out of luck. These jobs will be outsourced 100% to poorer countries.

The road to hell is littered with good intentions, and this is yet another example.

In this digital ecosystem, it is almost impossible for a government to regulate an industry and make it more competitive.

In fact, they are creating more second-order headaches for tech management.

Ultimately, this is a very bullish event for tech shares, because I believe there is no need to have 99% of tech workers in US soil, opening up the opportunity to labor arbitrage the entire staff.