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Silicon Valley’s Tech Talent Gold Rush Begins as H-1B Visas Face Scrutiny in Washington

Silicon Valley’s mad scramble for highly-coveted special visas for skilled overseas workers started Monday, but the process won’t last long.

The government issues just 85,000 H-1B visas a year; last year, there were 236,000 applicants. On Monday, U.S. Citizenship and Immigration Services began accepting applications for the visas, which allow overseas workers to take jobs in tech, healthcare and other sectors. Last year was the fourth year in a row that the application window closed after just a few days.

H-1Bs were among the programs that Trump targeted on the campaign trail. Depending on whom you ask, the visas either fill a skills gap that plagues the tech sector, or allow corporations to undercut U.S. workers with lower-paid replacements from overseas.

The biggest users of H-1Bs are outsourcing companies like Tata, Infosys (INFY) and Cognizant (CTSH) , but tech giants including IBM (IBM) , Microsoft (MSFT) , Amazon (AMZN) , Intel (INTC) , Alphabet‘s (GOOGL) Google and Apple (AAPL) were among the top 20 in 2013 stats Howard University professor Ron Hira, who testified before Congress on H-1B visas last year.

The Trump administration has targeted H-1B visas as a “cheap labor program” that undercuts the wages of U.S. workers, and has examined potential reforms, though the White House has not produced a formal proposal. The H-1B program got critical attention in March, when the CBS (CBS) news program 60 Minutes ran an exposé on H-1B visas that examined cases in which U.S. workers had to train overseas replacements.

This year the government suspended priority applications, which provided a quick response for a fee of $1,225. The U.S. Citizenship and Immigration Services said that it eliminated the option to make the overall H-1B program more efficient — not because of initiatives at the White House or Congress.

A spokeswoman from the U.S. Citizenship and Immigration Services said the government will take applications until “a suitable number have been received” but did not disclose a date.

Tech trade group FWD.us, which advocates updating the H-1B process, notes that for the last four years, the application window has closed within a week. The group’s founders include Facebook (FB) CEO Mark Zuckerberg, former Microsoft boss Bill Gates and Dropbox CEO Drew Houston. Tech bigwigs such as Netflix (NFLX) founder and CEO Reed Hastings, Google Chairman Eric Schmidt and Yahoo! (YHOO) CEO Marissa Mayer are also supporters.

“Highly-skilled immigrants create new American jobs, raise wages for native-born workers, and contribute enormously to growing our economy,” FWD.us President Todd Schulte said in a statement. “We need to expand the number of H-1B visas offered while reforming the visa to crack down on bad actors, eliminate the green card backlog to help high-skilled immigrants become citizens, and create a startup visa in order to make our country more competitive in the modern global economy.”

Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa) and Assistant Democratic Leader Dick Durbin (D-Ill) proposed legislation earlier this year to reform the visa program. Grassley said the H-1B workers should “complement America’s high-skilled workforce, not replace it,” in a January press release.

Meanwhile, Rep. Zoe Lofgren (D-CA), who represents Silicon Valley, proposed the High-Skilled Integrity and Fairness Act of 2017 in January to curtail loopholes that allow companies to find cheaper replacements for U.S. workers rather than fill true gaps in the workforce.

Apple, Alphabet and Facebook are holdings in Jim Cramer’s Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells AAPL, GOOGL or FB? Learn more now.

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