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The shrinking

Trump decision to suspend new work visas could dim ‘American dream’, may also delay recovery of US economy.

Published: June 24, 2020 3:15:46 am
coronavirus, covid 19, coronavirus lockdown, india lockdown, indian express Immigrants take away jobs from American workers, their influx leads to lower wages, and they take advantage of the generous welfare benefits.

On Monday, US president Donald Trump signed an order to temporarily suspend new work visas, including the H1-B visa for highly skilled workers, in order to bar the entry of new immigrants into the country — the suspension will be effective till the end of the year. The decision has ostensibly been taken to help American workers during this extraordinary upheaval in the labour market caused by the disruption in economic activities due to the spread of COVID-19.

However, the move, as well as its timing, suggest that Trump is using the COVID pandemic as an opportunity to harden immigration laws — an issue that has been a cornerstone of his administration’s agenda, which blames “outsiders” for a range of problems ranging from unemployment to crime — in the run-up to the US presidential polls in November.

A recovery in the labour market, he calculates, could strengthen his chances of reelection. That may or may not be true, but decisions driven by narrow and short-term political considerations often ignore the larger costs over the long run. For a country that has long championed the cause of globalisation, and the benefits that flow from embracing diversity and the free movement of capital and labour, a halt to immigration, even if temporary, marks a reversal of long cherished ideals. Even as it thickens the shadow over the “American dream”, it is likely to hurt innovation and delay the recovery of the US economy.

The economic arguments most often made against immigration in the US are straightforward, and simple-minded: Immigrants take away jobs from American workers, their influx leads to lower wages, and they take advantage of the generous welfare benefits. The evidence, however, suggests overwhelmingly that immigrants have contributed to the country’s economic success.

As a major recipient of the best and the brightest from across the world, the US tech industry is likely to bear the brunt of the new restrictions. Not surprisingly, major US tech firms have already begun to speak out against against the visa policy. “Immigration has contributed immensely to America’s economic success, making it a global leader in tech, and also Google the company it is today,” said Alphabet CEO, Sundar Pichai, himself an immigrant, on Twitter. “Very much disagree with this action. In my experience, these skillsets are net job creators,” said Elon Musk.

Suspending work visas may not even help American workers in the labour market. As some have argued, these visas are needed to recruit workers for jobs that local American workers are either unwilling or unable to do. US-based firms may face difficulties in filling up positions that require specific skills in sectors that drive economic activity and which in turn contribute to expanding employment opportunities for local labour.

Thus, these restrictions are neither good for America, nor for India, which is likely to suffer disproportionately — Indians had applied for as many as 1.84 lakh, or 67 per cent of the total H-1B work visas, for the current financial year ending March 2021. India must put forth its concerns, Trump administration must reconsider its decision.

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