American businesses depend on highly trained talent to remain competitive, particularly in sectors like technology and life sciences, where a workforce with the right skills is a strategic advantage. While tech layoffs have grabbed headlines recently, hiring and retaining top performers with the right STEM skills and other expertise remains an elusive necessity.

American companies have long relied on overseas talent to fill critical workforce gaps, but recruiting and retaining great foreign talent is getting harder. China produced nearly half (47%) of the world’s top AI researchers in 2022, and 28% chose to work in China—almost three times the share from three years prior.

Pathways to immigration and work status for foreign nationals have put wind in the sails of American businesses for years. However, recent layoffs, government policy changes and visa fee increases have made navigating that course more complicated and expensive. The implications for HR strategists are profound, especially for those at smaller companies. Charting the right course for securing top-notch foreign talent requires knowledge and skill.

The downstream impact of layoffs

More than 86,400 workers at U.S.-based tech companies have lost their jobs so far in 2024, according to Crunchbase, on top of the 191,000 who were laid off in 2023. Big Tech innovators, including Microsoft, Amazon, Apple, Google and Meta have all reduced their workforce.

Many tech companies have also reduced or halted their permanent labor certification program (PERM) applications. Issued by the U.S. Department of Labor (DOL), PERM certifications allow businesses to hire foreign nationals to work permanently in the U.S. The process aims to assess whether there are not enough U.S. workers willing, able, qualified and available to accept the role. It also determines whether employing foreign nationals would adversely affect the wages and conditions of equally capable American workers. In most cases, companies must obtain PERM certification before submitting an immigration petition to the U.S. Citizenship and Immigration Service (USCIS).

The PERM process is an expensive undertaking for employers, with costs running as high as $15,000- $20,000 per case. Earlier this year, both Google and Amazon notified employees they were pausing new PERM filings through the end of 2024.

Layoffs and declining PERM applications have far-reaching implications. Businesses that have laid off over 100 employees must suspend their PERM green card process for six months and are subject to the labor market test if they rehire for the same role. They must advertise for a professional role in six places, and if just one qualified American citizen or permanent resident candidate applies for the position, then the PERM process closes for that role.

Beyond PERM concerns, fee increases, a recent Supreme Court decision and election-year politics have injected a healthy dose of uncertainty for HR executives and foreign-born workers.

In March of 2024, the government increased fees and changed rules to stifle abuse in the H-1B visa lottery program, which grants 65,000 visas annually plus an additional 20,000 for individuals with master’s degrees or higher from U.S. universities. The changes have made it more difficult and expensive for employers to hire noncitizen talent.

Additionally, this summer’s Supreme Court decision to overturn Chevron v. NRDC will likely weigh on immigration cases for years. The ruling states that courts are no longer required to defer to Federal agencies like the Department of Homeland Security (DHS) or the Board of Immigration Appeals (BIA) for interpretations of ambiguous regulations—resulting in more inconsistent interpretations and enforcement of immigration laws across jurisdictions, increased complexity and a backlog of cases.

See also: How ongoing worker shortages highlight an ‘urgent need’ for upskilling

Charting the best course forward

Recruiting highly skilled foreign-born talent in this environment requires a solid understanding of immigration law and a thoughtful strategy—especially for smaller companies on tight budgets. With a three-year PERM backlog and a restrictive H1-B lottery, companies should explore alternative strategies, like L-1 visas for intracompany transfers from overseas offices or hiring employees with specific technical skills who qualify for O-1A extraordinary ability visas.

Here are strategies HR executives should consider:

1. Develop a comprehensive long-term sponsorship strategy

Assess the business needs that justify hiring for specialized skills not readily available in the U.S., then budget for sponsorship costs associated with visa applications and legal fees. Streamline and standardize processes for visa sponsorship to ensure consistency and efficiency.

2. Familiarize yourself with common visa types:

• H-1B visa: For specialty occupations requiring a bachelor’s degree or higher.
• L-1 visas: For intracompany transferees in managerial positions with specialized knowledge. Ideal for companies with international offices.
• TN visas: For Canadian and Mexican professionals.
• O-1 visas: For individuals with extraordinary ability or achievement in their field.
• EB-1A green cards for Extraordinary Ability and EB-2 green cards for National Interest Waiver: These green cards are self-sponsored and have stringent requirements.

3. Understand U.S. immigration laws and seek counsel

Keep abreast of frequent regulatory changes from the USCIS, Department of Labor and other relevant bodies. Leverage the expertise of immigration attorneys to help with applications, ensure compliance and get counsel on strategic initiatives and complex cases.

4. Look for technically qualified candidates at universities

Graduate programs are a good source for specialized technical experts. Individuals in these programs can grow into the job and self-sponsor if they meet EB-1A or EB-2, NIW criteria. If a foreign national cannot secure an H-1B visa, the O-1A nonimmigrant petition could be a viable alternative. Seeking qualified individuals in a master’s or PhD program where their work is published makes the application process easier.

5. Ensure compliance and mitigate legal risks

Maintain accurate documentation and file applications within the required timelines to avoid penalties and delays. Regularly audit immigration processes to maintain compliance with federal regulations, and make sure you have anti-discrimination policies and training in place.

6. Budget for sponsorship costs

Be prepared to pay for visa applications, legal fees and potential premium processing. Allocate resources to remain compliant with visa regulations and record-keeping requirements.

7. Leverage HR technology for immigration management

Use HR software to track visa statuses, renewal dates and compliance requirements. Set up automated notifications for critical deadlines.

8. Plan for long-term retention and career development

Assist eligible employees in the process of obtaining permanent residency (green card) as part of your retention, career development and employee recognition strategies.

Highly skilled foreign-born talent has always been instrumental in making American businesses global innovation leaders. The right strategies—combined with sound human capital management focused on engagement, diversity and inclusion, and cross-cultural collaboration—will help HR executives build the high-performing workforce required to compete in today’s global economy.

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