What has happened to so dramatically change the fate of the upwardly mobile H1B community? 9/11, of course — even though layoffs attacked Silicon Valley much before the terrorists attacked the United States. So what changed after 9/11 that has instilled this fear among members of one of the U.S.’s highly educated communities?

Changes?

Has there been any change in the laws that govern the H1B program? “No,” says immigration lawyer, Cyrus Mehta. “The H1B program hasn’t changed since September 11. There have been a few tweakings of some regulations, but not any major changes to the law itself. What has changed is that the INS has become more vigilant of people who have gone out of status. Those laid off are more vulnerable to getting deported.”

Another immigration lawyer, Sheela Murthy, agrees. “The INS is much more strict now. If anyone goes out of status they have to go back.” And they are now looking at new applications in minute detail.

This does not help people in Uday’s situation, who have enough potential to find a job here, but are stuck in the middle of the storm due to the poor job market. One would think that Uday has the option of going to another country — perhaps in Europe — or taking advantage of India’s stronger IT market. The problem with countries such as Germany, according to Uday, is that it is difficult to get permanent resident status. “And now is the time for me to settle down. I can’t afford to just spend a few years somewhere and again relocate.” As for India, he feels that the jobs available are not suitable to his skill set — though many would suggest he is misguided in that assumption.

Sudhir, a recent graduate from the University of Oklahoma specializing in hardware development, share’s Uday’s perspective. “I don’t want to go back, as there is not much development being done by companies in India that require my kind of specialized skills.” Fresh graduates are also facing the brunt of the economic downtrend. They have one year after graduating to either find a job or enroll in a Ph.D. program to maintain their student status.

Another option is to switch to a regular visitor status. But, Uday says, “Even to change my status here to that of B2 is not very straightforward. I will have to be careful of what I say in my application. I will have to state very clearly that I will pack my bags and go back, and also that I will be looking for jobs here.”

Changing to B2 will also soon become a dead-end solution. A new INS regulation reduces the maximum stay of a B1/B2 visa holder from six months to a mere month, which does not give much time to find a job and switch the status to H1B.

Corporate Limbo

Murthy feels that the main issue facing H1B holders today is job permanence. “They can no longer jump around freely from one job to the other and keep transferring their visas. Companies are now reluctant to hire H1B holders.” To stay put in their jobs, many H1B workers are taking major salary cuts. This may create problems in their green card processing, as the salary may be way below the INS requirements.

A more immediate problem for those who still have their jobs is that their companies are no longer processing green cards. Even big companies like Cisco have embargoed all fresh green card applications. After all, how can they justify asking for permanent employees on one hand, and laying off a large chunk of their work force on the other? For many, this means they will have to leave the country at the end of their six-year period, as, according to the regulation, they can apply for extension only if their green card application has been filed and reached the final stages of procedure.

People whose green card applications have been filed can get an extension on their H1B. However, because of a new regulation, getting their passports endorsed by just crossing the border into Canada or Mexico may not be as easy as before. If they get rejected there for any reason, they will not be able to enter the country again.

This is also true if someone’s visa status changes during their stay in the U.S., such as from student to H1B, or vice versa. “But the chances of getting rejected are very slim,” says Mehta. “Unless you are from one of the six countries marked by the U.S. government as potential terrorist states — Iran, Iraq, North Korea, Sudan, Libya and Cuba.”

While September 11 may have increased the vigilance level of the INS, the economic downtrend has affected the state of H1B holders much more. “Only 28,000 H1s have been issued so far in this year, out of a total quota of 198,000,” says Murthy. The INS year is from October to September; hence, more than half of the year is already gone. This is a major reversal in the trend of recent years that saw the quota surpassed within the first few months, and the technology sector always lobbying to get the quota increased.

So it is not as if companies can no longer apply for more visas, but that they just don’t have the jobs to keep the highly skilled people in this country. Unless there is a quick turnaround in the economy, we may see a major reverse brain drain in the next few months.