US visa roadblock: Indian IT giants shift to offshore hiring

US PERM suspension

US Department of Labor suspended new and pending applications under the Permanent Labor Certification (PERM) programme involving eight technology companies.

Affected companies

Microsoft, Adobe, Cognizant, Infosys, Tata Consultancy Services, Wipro, HCLTech and Capgemini.

Impact on workers

Employees depend on this route to secure permanent residency after years of working in the US.

H-1B visa status

The suspension does not affect existing H-1B visas or jobs.

Shift to offshore hiring

Indian IT firms may rely less on sending employees to the US and increase offshore and nearshore teams.

Karanth's view

PERM shows long-term commitment between employer and employee, impacting talent attraction and retention.

“employees, irrespective of seniority, function and level, aspire to qualify for perm on merits of impact and value creation they’ve done for their employer”

Local hiring challenges

Onboarding local talent at scale is expensive and difficult due to skill and cost mismatches.

Global Capability Centres

Setting up or expanding GCCs in India remains cost-effective despite 25% cess in HIRE Act bill.

Local hiring increase

The change could create more job opportunities in Indian tech hubs like Bengaluru and Hyderabad.

Green card uncertainty

Employees approaching six-year H-1B limit may face extended delays in green card applications.

Alternative routes

Employees may move to employers outside suspension, apply through EB-1A or EB-2 NIW categories, or relocate to other countries.

Talent retention challenge

Companies face difficulty retaining experienced employees without clear path to permanent residency.

“specialist and senior talent being put on a processual limbo is not a desirable state for a country that’s heavily dependent on overseas stem talent”

Long-term shift

Traditional model of sending employees to US may give way to projects handled from India.