US President Trump on Monday signed an executive order asking federal agencies to hire Americans, and preventing them from contracting or subcontracting foreign workers, mainly those with H-1B visas.
The move is expected to be a setback to Indian IT professionals eyeing the US job market.
Earlier on June 23, the Trump administration had suspended H-1B visas along with other types of foreign work visas until the end of 2020 to protect American workers in the crucial election year.
The H1B visa, most sought-after among Indian techies, is a non-immigrant visa that allows US companies to employ foreign workers in specialty occupations that require theoretical or technical expertise.
"President Trump's executive order on 'Aligning Federal Contracting and Hiring Practices with the Interests of American Workers' appears to have been made based on misperceptions, and misinformation," Nasscom said.
A part of the executive order focuses on federal contracting, and part of the order focuses on the H-1B visa program in general, it said.
"Both elements of the Executive Order mandate reviews, reports, and development of policy and practice and recommendations rather than mandating any immediate changes," it added.
Nasscom noted that the order comes at a time when there is a "huge shortage" of STEM (science, technology, engineering, and mathematics) skills in the US, that workers on short-term non-immigrant visas like H-1B and L-1 help bridge.
The industry association pointed out that unemployment rate for computer occupations (those most common amongst H-1B visa holders) declined from 3 per cent in January 2020 to 2.5 per cent in May 2020.
Against this, unemployment rate for all other occupations grew from 4.1 per cent in January 2020 to 13.5 per cent in May 2020.
"Further, in the 30-day period ending 13 May 2020, there were over 6,25,000 active job vacancy postings advertised online for jobs in common computer occupations, including those most common to H-1B visa holders," Nasscom said.
The executive order requires all federal agencies to complete an internal audit within 120 days and assess whether they are in compliance with the requirement that only US citizens and nationals are appointed to the competitive service.
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