The H1-B visa program may decide whether the U.S. will lead the world in the development of computer chips and AI?

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Without smart H-1B visa reform, the United States cannot lead the world in AI or semiconductor development and lead the world into the future. Let’s face it, the United States is in a fistfight for technological, economic, and ultimately political primacy. Whoever leads in creating the next-generation of semiconductors and AI systems will set the rules for the twenty-first century. Put another way, chips and AI now are at the core of military deterrence, economic growth, national security and American primacy in the world. Yet, amid this life-and-death struggle for high-tech dominance, Washington maintains a policy that prevents America from winning this race: restricting the free movement of world-class talent into critical U.S. industries—especially, the H1-B visa program.

Close-up of Silicon Die are being Extracted from Semiconductor Wafer and Attached to Substrate by Pick and Place Machine. Computer Chip Manufacturing at Fab. Semiconductor Packaging Process.

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Consider Chips

Even after significant federal investments, the U.S. still relies heavily on foreign foundries for advanced production—mainly Taiwan’s TSMC. Developing resilient domestic capacity has proven way slower and more costly than expected, with delays, cost overruns, and workforce shortages hampering key U.S. projects. According to a Reuters report, senior TSMC leadership has made it clear: thelatest nodes will launch in Taiwan first; U.S. fabs face longer timelines due to permitting issues, supply chain gaps, and shortages of specialised labour. In other words, America cannot “reshore” or “just plug in American workers” its way out of the talent shortage; it must recruit and retain the best chip and AI talent worldwide now, or lose valuable time.

The Stakes

If you doubt the stakes, consider the broader perspective. The International Monetary Fund’s April 2025 analysis of AI’s global impact predicts widening income gaps between countries, particularly because advanced economies with strong pools of skilled human capital will benefit the most. This essentially means “talent is destiny.” Countries that invest in high-skill workers—and prioritize their deployment—will strengthen their advantages across various sectors, including defence. The United States has the research universities, capital markets, and ecosystems in place. What it needs is a visa system that enables top talent to move into critical roles smoothly.

And yet—ironically—the visa program that most Americans associate with tech talent, the H‑1B visa, is not fulfilling its role as the operational workhorse it needs to be. According to the International Monetary Fund, the U.S. cannot succeed in the chip and AI race if it hampers itself with an outdated, capped, lottery-driven system that consistently leaves specialised workers stranded while competitor nations move with much greater agility. What is more, as many studies have shown, “for every temporary foreign worker hired by a US firm, 5 to 7.5 new domestic jobs are created in those industries, and that a 1 percent increase in foreign STEM workers leads to a 7 to 8 percent increase in native workers’ wages.“

The Challenge: Chips, AI And The Talent Curtain

Today’s semiconductor supply chain is global and modular: lithography from the Netherlands, production from Taiwan, design from the U.S., materials from Japan and South Korea. The U.S. can’t simply reshore the entire supply chain overnight; instead what it *must *do is make itself the most attractive place for high-end talent in design, architecture, and advanced manufacturing. That takes talent—talent that America does not always have. Furthermore, speed is crucial, and delays mean defeat. U.S. jobs are on the line not because these immigrants are replacing American workers, but because we are losing the benefit of good higher level jobs they create by coming here.

H-1B Visa Reform: Theory Versus Practice

On paper, the H-1B visa allows U.S. employers to temporarily employ foreign workers in “specialty occupations” that require at least a bachelor’s degree in the relevant field. However, in practice, it is plagued by several structural issues.

The H-1B program operates under a rigid annual quota, triggering a lottery whenever demand exceeds supply—a now-routine occurrence in the tech industry. As global talent, AI, and chip manufacturing surge, this outdated cap and random selection process fails to match expertise with urgent needs. Despite widespread calls for reform, Congress has remained stagnant, instead adding new hurdles: higher $100,000 fees, stricter education-job rules, and increased compliance demands.

Alternatives Exist — But None Replace The Workhorse

While the H-1B is central to high-skilled immigration, other pathways play key roles as well: the L-1 visa allows multinationals to transfer staff from abroad, the O-1 recognizes individuals of extraordinary ability, and permanent options like the EB-1A, EB-1C, and EB-5 provide routes to green cards. These programs are valuable, but none match what should be the H-1B’s unique function as the fastest, most practical way for U.S. employers to bring in specialized talent when it’s most needed. Yet, the H-1B cap continues to limit the number of potential hires, even preventing many from being considered.

Processing the H1-B visa is a bottleneck for the high-tech industry.

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Why H1-B Visa Reform Matters Now

Imagine a U.S. semiconductor fabrication plant relying on a team of EUV lithography specialists, advanced packaging engineers, and AI system architects who are not available locally. The company identifies suitable foreign candidates, offers them competitive packages, and arranges sponsorship. However, the H-1B cap has been reached, so the talent cannot enter. Delays in ramping up cost billions. Meanwhile, competitor countries will not wait to hire them.

Similarly, as AI transitions from model research to system deployment, the U.S. must lead the next generation of systems first. The difference between being a leader and a follower can be measured by one product release, one cloud-region advantage, or one national-security edge.

In either case, good new American jobs are lost as part of the delays.

H1B Visa Reform Is Long Overdue

Current reform efforts have been misguided. For example, the Department of Homeland Security’s proposal would establish a lottery weighting based on wage level, giving more entries for “Wage Level IV” offers. In a letter to that Department, the Economic Innovation Group (EIG) critiques the proposed H-1B “weighted lottery” system. The EIG contends that the rule—essentially using wage-level tiers—would favour lower-paid occupations rather than genuinely high-impact roles.

The point is that the system requires a fundamentally different approach: one focused on value, *impact, *and mission. An expected-lifetime-earnings metric or a sector-specific strategic track (such as semiconductors, AI systems, or critical infrastructure) could better align visa allocation with national priorities. American victory and jobs cannot rely on the assumption that everything we need is in the United States. On the contrary, America must be able to attract talent from around the world to remain a global leader and create new jobs.

The US flag on the clock face on a paper background. It is time for the U.S. to act.

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Time For Congress And The Administration To Act

Congress must rethink the H-1B program as a cornerstone of U.S. innovation and economic strength—raising or waiving caps for strategic tech fields, replacing the lottery with merit-based selection tied to lifetime value and national priorities, expediting processing for critical specializations, and keeping the system employer-driven, mission-focused, and free from political short-termism.

Conclusion

In short, H1-B visa reform is crucial. As the global race for chips and AI intensifies, the U.S. cannot afford a visa system that treats its key talent entry points like a lottery. Congress and the administration should implement these changes now, not later. In this competition, delay equals defeat. Success benefits the entire nation: U.S. employers, foreign specialists, and the future American workforce that will rely on U.S. leadership in the digital age.