During the Trump administration, many technology companies opted to shift operations to Canada. With the Biden administration now firmly in place (and supposedly changing the rules around the H-1B and other visas), will that trend continue?
Various studies over the past several years, including ones by Envoy Global and commercial real-estate investment firm CBRE, found major Canadian cities such as Toronto and Vancouver gaining tech jobs at a steady pace. “Talented international professionals choose destinations other than the United States to avoid the uncertain working environment that has resulted directly from the agency’s processing delays and inconsistent adjudications,” Marketa Lindt, president of the American Immigration Lawyers Association, told a U.S. House of Representatives hearing in July 2019.
However, the Biden administration has rolled back many Trump-era laws that contributed to that “uncertain working environment,” including Trump’s H-1B ban. While it may take some time for Biden’s actions to fully play out, the denial rate for H-1B applications noticeably dropped between the first two quarters of fiscal year 2020 and fiscal year 2021, which could encourage U.S. tech companies of all sizes to invest more heavily in immigration-related hiring.
For critics of the H-1B, that dip in denial rates is bad news, because it could open the door to what they view as a major abuse of the system—consulting and business-services firms applying for tens of thousands of visas, then subcontracting the workers to other companies at low rates that undercut American workers. While the Biden administration’s first regulatory agenda, published this summer, hinted at an intention to “modernize” H-1B requirements, actual details of any visa transformation are scarce. If the administration wanted to ease many critics’ concerns, it could issue guidance that restricts the visa’s use to very highly specialized (and highly compensated) cases.
In the meantime, Canada will continue to push for tech talent and companies, potentially transforming cities such as Toronto into powerful rivals to U.S. tech hubs such as Silicon Valley and New York City. “Winning” that battle isn’t just a matter of immigration policy; each country must present the right mix of tax incentives, funding, and policies considered favorable by tech startups and giant companies.