Tech companies will stand to lose out if the immigration ban comes into effect
With the introduction of President Trump’s immigration crackdown a few months ago, many within Silicon Valley began to fear the repercussions that the tech industry would face due to this immigration reform.
These fears were quelled somewhat when the lower courts deemed the immigration reform to be illegal and without merit, which meant that the changes to immigration laws were put on hold, a damaging blow to the policies put forth by Trump’s administration.
In late June, however, the Supreme Court ruled that it would take the case up following their Summer recess that ends late September, which invariably puts the immigration reform into effect until the Supreme Court rules one way or the other.
While this is a standard decision by the Supreme Court when deciding to hear a case, it’s a move that has yet again stirred up fears inside Silicon Valley, especially when paired with a move by Trump to potentially shelve a startup immigrant rule that was originally going to take effect in mid-July.
With the heavy presence of Asian tech entrepreneurs in Silicon Valley and all throughout the US, these rulings will only serve to have a damaging effect on future immigration to the country, both for tech entrepreneurs who wish to come to America and for tech companies that rely on these entrepreneurs.
What Trump’s immigration ban entails
To best understand the issues caused by Trump’s immigration ban, it’s important to take a look at the ban itself and what it entails. People from six different countries with a population that primarily consists of Muslims are banned from travelling to the US, including Syria, Yemen, Iran, Libya, Somalia, and Sudan.
This ban is also in effect for all refugees from these countries, although this decision could be reversed once the Supreme Court takes up the case later this year. This move by the Supreme Court doesn’t point in any way towards their decision on the matter, as it’s common when the Supreme Court decides to hear a case.
While the intentions of this immigration ban are to keep residents of Muslim-based countries from entering into the US, it’s already causing a wide range of additional immigration issues, as the amount of applicants for immigration to the US has dropped across practically all countries since the announcement of the immigration ban.
How this ban adversely affects the tech industry
While there is a wide range of industries adversely affected by the immigration ban, the tech industry is among the most heavily affected for a number of reasons. Trump has been warned by many industry leaders about his aggression when it comes to immigration, but it does not appear as though their warnings have caused the Trump admin to alter their plans.
From the very beginning, Trump’s administration has been an America-first one, which has translated to widespread issues for immigrants looking to start a new life and create new businesses in America.
It has already become much more difficult for immigrants of any nation to obtain travel or work visas, which many in Silicon Valley believe will be devastating to smaller startups that are looking to expand internationally, such as the ones started by Asian entrepreneurs.
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Another damaging aspect of Trump’s immigration policies that was signed in April is an order that states that an extensive review will be held on certain programmes for visas that provide companies in America with the means of hiring foreign workers, yet another blow to the technology industry that benefits greatly from this H-1B visa programme. In this programme, employers in America have the ability to hire foreign workers on a temporary basis for specialty occupations, such as those found within the tech industry.
Silicon Valley is viewed by many industry leaders throughout the US as an ecosystem that allows smaller startups to flourish, eventually evolving into large corporations with thousands of American employees. However, foreign workers are deemed to be essential to these startups, which Trump’s immigration ban is putting into jeopardy.
In fact, the economy of California is the best it’s ever been because of these highly-skilled entrepreneurs who move to the state, buy homes, build businesses, and spend money. When taking a look at a recent study, it’s been shown that immigrants who travel to America are over 100 percent more likely to build a business than non-immigrants.
Among startups within the US, immigrants have founded just over 50 per cent of these companies, the majority of which are immigrants from countries in Asia. Outside of the tangible statistics that can be immediately studied, another way in which Trump’s immigration ban negatively affects the tech industry and many other industries around the U.S. is that immigrants are going to be asking themselves whether the U.S. remains a good place to start a company.
With the H-1B program mentioned previously, applications by immigrants for visas that cover the 2018 fiscal year have dropped, which marks the first instance of this happening in many years, displaying a lack of interest by immigrants brought about by the immigration ban. The number of applications sits at just under 200,000, which is a drop of over 35,000.
Delay and imminent elimination of startup immigrant rule
Compounding the issues created by Trump’s immigration ban is the delay of a startup immigrant rule that was set to take effect in mid-July. This decision was announced on July 10 by the Federal Government, along with the idea that they will likely eliminate this rule in the near future.
This rule would have allowed foreign workers to come into America in order to create smaller startup companies, something that the technology industry heavily benefits from. This announcement has angered many within the technology sector that believe this ruling will damage the following generations of American businesses.
This policy is being delayed specifically by Homeland Security. Without this delay, the rule would have gone into effect on the week of July 17, as it was originally approved by the Obama administration during his last few days as President.
As with the Trump immigration ban, this setback on immigration makes the US far less appealing to foreign workers, particularly those in Asian countries, who would have otherwise chosen to come to America and create startup businesses. As of today, this delay is set to last until mid-March, 2018, at which point the Department of Homeland Security will listen to public comments and consider rescinding the rule.
While the Obama administration was still in the White House, an estimate was made by the DHS that this startup rule would allow 3,000 entrepreneurs to be eligible to come into the US annually. Once here, these entrepreneurs would be able to stay within the country for 30 months.
If select criteria was met, the stay could’ve been extended for another 30 months. Throughout Silicon Valley, it is widely believed that both American innovation and job creation are going to be hurt by the delay of the startup rule.
Implications for Asian tech entrepreneurs
The implications of the Trump immigration ban and further destructive immigration policies on Asian tech entrepreneurs are decidedly negative. Even entrepreneurs in other countries than the six specifically mentioned within the ban are being affected.
Applications for visas from foreign students living in China and India has declined for the next fiscal year. Although America was seen as one of the most foreign-friendly places in the world for many years, particularly during the Obama administration, skilled Asian workers within tech are considering taking their skills to more foreign-friendly destinations.
Many within the Middle East and India are looking to places such as Singapore and China for work as these countries continue to expand their reliance on foreign workers. Over the past decade, the technology industry within the US has benefited from a dramatic increase in skilled Asian entrepreneurs who are creating new businesses and improving operations in many big-name companies throughout the country.
Many tech companies in the US, large and small, are being headed by Asian immigrants, including Satya Nadella at Microsoft and Geoff Woo of HVMN, which is leading the way in development of over-the-counter supplements for focus and attention. With a tightening of the H-1B program, younger immigrant entrepreneurs would be less likely to be admitted into the US and follow in Nadella’s or Woo’s footsteps.
Even though the technology industry has become reliant on Asian immigrants for the startups they create, President Trump and his administration are crafting increasingly-restrictive immigration policies that do nothing but harm the efforts by tech giants such as Apple and Microsoft to encourage tech entrepreneurs to bring their skills to Asia from America and start doing what they do best.
If you’re an entrepreneur in Asia who’s considering applying for an H-1B, you can continue to do so, although your chances of obtaining one of these visas are dramatically reduced.
The Supreme Court will begin hearing cases in late September, which is when Trump’s immigration ban is expected to be heard.
While it’s impossible to make a definitive statement as to how the Supreme Court will rule, a ruling against the ban will reduce many of the immigration issues that have resulted as of late.
Whether or not Asian tech entrepreneurs will continue to be adversely affected by this remains to be seen.
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