Banks Proposes American Tech Workforce Act to Raise H-1B Wages

(UNITED STATES) Senator Jim Banks introduced the American Tech Workforce Act on September 17, 2025, setting off a sharp debate over how the United States 🇺🇸 should manage high‑skilled immigration and student work programs tied to the tech sector. The proposal would raise the H-1B wage floor from $60,000 to at least $110,000 (indexed to inflation, with provisions that could push the threshold as high as $150,000), replace the current H‑1B lottery with a wage‑ranked selection system, restrict the use of third‑party staffing firms by limiting visa validity to one year at client sites, and order OPT elimination, ending post‑graduation work for foreign students.

Banks argues these moves will protect U.S. workers by reducing the use of “cheaper foreign labor” and curbing “domestic outsourcing,” while industry voices and immigrant advocates warn the bill would cut off a major pipeline of early‑career talent and strain tech hiring.

Core changes the bill would make

• Higher wage floor: H‑1B pay must be at or above the greater of the salary paid to a comparable U.S. worker over the past two years or $110,000, with annual inflation adjustments. Provisions could push the effective threshold to $150,000 in some scenarios.
• Wage‑ranked selection: The current H‑1B lottery would be replaced by a merit system that ranks petitions by the highest wage offers.
• Limits on third‑party staffing: H‑1B validity for workers placed at client sites through staffing firms would be capped at one year.
• OPT elimination: Optional Practical Training (OPT), which allows post‑graduation work for many foreign students, would be ended.

Employer sponsorship and wage rules

The bill reworks how employers sponsor and pay foreign workers. Key points:

• Employers would compete for H‑1B allocations by offering higher wages, deterring low‑wage placements and prioritizing roles that command higher pay.
• Supporters say a wage‑ranked system refocuses visas on advanced roles, while critics warn it could favor the largest firms that can outbid competitors.
• The proposal aims to stop H‑1B from being a discount option and push employers to pay market value for scarce technical skills.

OPT elimination: scope and consequences

Today, nearly half a million foreign graduates use OPT to work in the U.S. after earning degrees, often in STEM fields. The bill’s elimination of OPT would:

• Cut off a common bridge from U.S. campuses into the workforce, especially affecting students from India and other countries.
• Force many graduates to return home or seek work elsewhere unless they move immediately into another visa category.
• Require university international offices to redesign career support, since many degree programs are built with OPT in mind.
• Remove a trial‑period pathway employers use to evaluate and train new graduates before longer‑term sponsorship.

Banks contends companies use OPT to fill junior roles at lower pay, which he says harms recent American graduates. Opponents counter that ending OPT would damage the U.S. appeal to international students and weaken university‑industry ties.

Nearly half a million foreign graduates currently use OPT to work in the U.S. after finishing degrees; ending OPT removes a major way for students to gain U.S. work experience.

Third‑party staffing limits and operational impacts

The bill’s one‑year cap on third‑party placements would:

• Force firms that build teams through layered vendors to reconsider contracts and workforce plans.
• Push staffing firms to either employ H‑1B workers directly or accept shorter placements and thinner margins.
• Increase compliance checks, renewals, and project disruptions for client‑site roles that previously ran multi‑year.

Banks’ office argues the one‑year limit discourages subcontracting that hides job conditions and enables abuse. Industry warns the limit will complicate project staffing and increase costs.

Who stands to gain or lose

The effects would vary across groups:

• Recent international graduates: lose a typical first job step in the U.S.; career plans that assumed post‑completion work would be disrupted.
• Early‑career hiring pipelines (tech firms, startups): could shrink; companies may need to move training offshore or pause hiring.
• H‑1B‑heavy staffing firms: face steeper wage commitments and shorter placements, reducing margins.
• U.S. graduates: may see more entry‑level postings aimed at domestic hires, though market realities will determine outcomes.
• Universities: potential drop in international enrollment and revenue if students choose destinations that keep post‑study work options.

Political and policy context

• Senator Banks, a Republican from Indiana, has proposed similar measures before (notably in 2022). He frames the bill as correcting incentives that favor low‑cost placements over domestic hiring.
• Labor groups and some lawmakers on the right back higher wage floors and ranked selection to refocus visas on true specialty roles.
• Industry groups and immigrant advocates warn that combining a higher wage floor with OPT elimination would reduce the U.S. ability to retain graduates trained in the U.S., slow recruitment for hard‑to‑fill roles, and weaken research and startup ecosystems.
• Critics also argue wage‑ranking could advantage the richest companies that can outbid smaller employers.

Practical implications for employers and students

For employers:
1. Review budgets to accommodate $110,000 (and potentially $150,000) salary floors.
2. Prepare to document wages and compete in a wage‑ranked H‑1B process (Form I-129 remains the sponsorship petition).
3. Map third‑party placements and decide which roles require direct employment to avoid one‑year caps.

For students and universities:
1. Be aware that OPT remains in place until law changes, but prepare contingency plans if post‑study work rights are removed.
2. Students should pursue earlier conversations with potential employers about long‑term sponsorship.
3. Universities should model enrollment and career service impacts if prospective students weigh the lack of OPT.

Operational unknowns and next steps

• The legislative text was not publicly available at introduction; no committee schedule or hearing dates have been announced.
• Many implementation details are unknown, including transition rules and whether pending applicants would be grandfathered.
• If the bill advances, expected debates will include:
  • Safeguards for small and mid‑size employers under wage‑ranked selection.
  • Transition or grace periods for students nearing graduation.
  • Enforcement mechanisms for the one‑year client‑site limit.
  • Potential carve‑outs or phased timelines.

How the bill changes the pipeline dynamic

The H‑1B and F‑1/OPT tracks often form a pipeline: students train in U.S. classrooms → work on OPT → move to H‑1B. The American Tech Workforce Act severs or tightens that pathway by:

• Requiring higher wages to qualify for H‑1B.
• Forcing employers to decide earlier about sponsorship.
• Making it harder for early‑career candidates to meet wage thresholds.

This would raise the bar for keeping graduates in the U.S. workforce, shifting where and how companies hire talent.

Practical checklist and recommendations

• Employers planning spring petition cycles: run models at $110,000 and $150,000 to see which roles remain viable.
• HR & compliance teams: map all third‑party placements; identify roles that must become direct employment to avoid the one‑year limit.
• University advisors: tell students OPT is still law until Congress changes it, but prepare for outcomes without post‑completion work.
• International students: reach out earlier to employers about sponsorship timelines and alternatives if OPT is removed.

Resources and official forms

• U.S. Congress bill tracking: Congress.gov
• H‑1B sponsorship (Form I-129): Form I-129, Petition for a Nonimmigrant Worker (USCIS)
• OPT work authorization (Form I-765): Form I-765, Application for Employment Authorization (USCIS)

Bottom line

The American Tech Workforce Act pairs a much higher H-1B wage floor, a wage‑ranked selection system, stricter third‑party staffing rules, and the end of OPT into one package. Supporters say it will protect U.S. workers and refocus visas on well‑paid specialty roles. Opponents say it risks losing global talent, weakening university‑industry pipelines, and harming early‑career opportunities for both foreign and domestic graduates.

Until the bill text is public and committee action begins, the debate will focus on trade‑offs between higher wages and stricter oversight versus access to early‑career talent and post‑study work. Stakeholders should monitor committee postings and agency updates and start modeling responses now.