Global tech markets are braced for a shockwave on Monday as the US government’s substantial increase in H-1B visa fees could drastically alter the landscape for major Nasdaq-listed companies. This strategic shift, raising the annual fee to USD 100,000 per applicant by September 2025, sends ripples through giants like NVIDIA, Tesla, and Alphabet, sparking widespread concerns over staffing costs and market reactions.
The Immediate Effect
According to the recent announcement, Nasdaq giants may face immediate repercussions on stock performance and overall profitability. Global enterprises heavily reliant on international talent are apprehensive, with companies like Cognizant and Infosys already experiencing noticeable declines. This move suggests a long-term pressure trend for industry leaders like NVIDIA and Amazon, amidst a tightening talent pool and increasing costs.
The Indian Tech Sector Feels the Heat
The repercussions for Indian IT companies with significant stakes in the US market are severe. The reliance on H-1B visas for a highly skilled workforce to execute tech operations means that fees skyrocket. Analysts like Seema Srivastava of SMC Global Securities stress the broader implications, predicting a reshuffling of hiring priorities and changes in operational strategies to manage these sudden expenses.
A Shift in Hiring Strategy
For companies like Apple and Microsoft, the visa hike forces a reevaluation of hiring strategies. As Seema Srivastava highlights, the heightened costs are likely to shift focus to retaining key senior roles while junior and mid-level hires could decrease. Offshore staffing or relocating talent might become more appealing if the US shores up domestic employment at the expense of international talent exchange.
Investor Concerns Amplify
The directive to boost American job opportunities has irked global investors. Sandeep Pandey from Basav Capital warns that rising staffing costs could compress profit margins, affecting tech stocks across sectors. As he explains, the elevated costs may not correspond to increased productivity, leading to potential declines in output, efficiency, and market volume.
Warning Signs For Nasdaq Stocks
Amid these challenges, Nasdaq tech giants brace for market disruption. As stated by market experts, NVIDIA, Tesla, and Alphabet may face negative reactions when trading resumes. A synchronized drop in stock values across markets could become a tangible concern as investors reassess risk and potential losses due to the administrative shift.
Indian IT: A Sector in Decline
Against this global background, Indian tech services are witnessing a downturn. While the benchmark Nifty shows resilience, the Nifty IT index skids significantly, underlining the vulnerability of tech service stocks to policy changes. With Tech Mahindra, Wipro, and Infosys facing declines, the broader economic implications loom large on the horizon.
This policy change represents a complex trade-off by the US administration, aiming to protect domestic jobs at the possible expense of innovation and market stability among tech titans. According to Mint, it signals a pivotal moment for technology leaders worldwide as they grapple with a reshaped global landscape.