Will US Immigration Policy Changes Mean the End of Silicon Valley As We Know It?

(Originally published August 4, 2020 on Medium by Henley & Partners.)

On 22 June, President Trump signed an executive order suspending temporary work visas – including H-1B, H-2B, L-1, and J-1 visas – through the end of 2020. In doing so, Trump doubled down on his promise, tweeted in April, to “temporarily suspend immigration into the U.S.,” by extending the prohibition on green cards through the end of the year as well. Together, the bans would bar as many as 525,000 foreign workers from entering the country for the rest of the year.

Seen through one lens, the order is only the latest salvo in White House aide Stephen Miller’s years-long campaign to curtail worker visas, arguing that they harm employment prospects for Americans. But the largest category of these visas – the employer-sponsored H-1B, annually awarded to 85,000 high-skilled foreign workers, three-quarters of whom labor for tech companies – has long been the subject of withering critique from the opposite end of the political spectrum as Silicon Valley’s favorite tool for creating a subservient underclass of talent.

Given their tenuous status, H-1B holders anonymously report stressful conditions and workplace discrimination – with little recourse from government or management. Trump’s populist arguments to curtail immigration on behalf of domestic workers will likely win him few fans among rank-and-file techies – nearly 60% of visa-holders’ native-born colleagues oppose policies that would limit the program and would prefer to see more protections and opportunities for their colleagues.

Silicon Valley’s CEOs have been more circumspect, torn between the hiring and financial imperatives to keep the foreign talent pipelines flowing and their need to appease a president who is not shy about vocally retaliating. For example, FWD.us, the immigration advocacy group co-founded by Facebook’s Mark Zuckerberg, called the proposed executive order a “significant mistake”. Meanwhile, Zuckerberg himself is facing down an open rebellion within Facebook over the decision not to take down the president’s incendiary posts, and in late June Unilever announced it was withdrawing all advertising from Facebook, Instagram, and Twitter in the US, stating that such advertising “would not add value to people and society”. Other megabrands including Coca-Cola quickly followed suit.

For Facebook, the solution to both dilemmas is to replace one geographic arbitrage with another under the cover of the pandemic. In late May – well after news of the executive order had leaked – the company abruptly announced it would transition nearly half of its 48,000 employees to remote work over the next decade. But there was a catch: salaries would be tied to the local cost of living, and employees who tried to game the system would be punished.

Facebook’s decision – preceded or quickly matched by Twitter, Shopify, Slack, and others – has been painted as a response to the social distancing conditions necessitated by the coronavirus pandemic, but it is also a form of arbitrage, anticipating the impending end of one pool of cheap talent and preparing to replace it with another in the event of a second Trump term. If so, the result will not only be the end of the H-1B program, but the end of Silicon Valley as we know it.