Could a $100,000 H-1B fee push tech workers to Canada?

(UNITED STATES) A steep new H-1B fee took effect at 12:01 a.m. ET on September 21, 2025, reshaping how U.S. tech companies hire global talent and accelerating interest in Canada’s more affordable immigration pathways. The rule imposes a $100,000 annual charge for each new H-1B worker, a sharp jump from the previous total government costs that typically ranged from $5,000 to $10,000 per case. The fee applies only to new H-1B petitions, not to current holders or renewals, and it’s already prompting employers and workers to rethink where to build careers and teams.

Large U.S. tech firms that rely on high volumes of H-1B hires face hundreds of millions of dollars — and in some cases more than a billion dollars — in new yearly costs if they keep hiring at past levels. For startups and mid-size companies, the calculus is even tougher: the annual charge alone could match or exceed the salary of a senior engineer, making new U.S. hires hard to justify.

Several companies advised H-1B staff who were abroad to return to the United States before the deadline. Others paused hiring plans or shifted roles to teams outside the country. Unions, universities, and employers have filed lawsuits arguing the fee harms the U.S. tech edge and weakens the country’s position in AI, data science, and software.

According to analysis by VisaVerge.com, the sudden increase is already changing employer behavior, with HR teams and counsel weighing cost per hire against project timelines and headcount limits. Recruiters report that some engineers who had planned to pursue U.S. roles are now looking at alternative destinations. Canada stands out in those conversations because it offers speed, lower costs, and clearer routes to permanent residency.

Policy changes overview

The new $100,000 charge is an annual fee owed for each new H-1B worker. Important details:

• Applies only to new H-1B petitions (not to current holders, renewals, or extensions).
• Existing cap-subject lottery and employer sponsorship rules remain in place.
• Companies that previously budgeted roughly $5,000–$10,000 per case now face an order-of-magnitude jump for every new hire.

The implementation was immediate, prompting in-house legal teams to push last-minute travel and filing decisions. Some employers chose to locate new engineering teams outside the United States to avoid the annual cost and policy uncertainty.

While legal challenges are underway, many employers are planning as if the fee will remain in place through the current fiscal year. Industry groups warn of a talent squeeze if companies slow or stop hiring international graduates from U.S. universities, many of whom rely on H-1B status to stay and work after student programs end.

For official background on the H-1B program, the U.S. government maintains policy and process pages through U.S. Citizenship and Immigration Services.

Impact on applicants and employers

The changes land particularly hard on smaller firms and research institutions:

• Founders report the new H-1B fee can wipe out an early-stage hiring plan in one stroke.
• Mid-size tech companies say the fee forces them to delay projects or expand in other countries.
• Research labs and universities face increased costs for bringing in international experts.

Workers face tougher choices too. New graduates who hoped to convert to H-1B may now seek jobs in countries where employer costs are manageable and where rules for long-term status are clearer. Some candidates fear that even if they land a U.S. role, they could be stuck in an employer-dependent system with rising expenses and limited job mobility.

Recruiters add that top candidates — including those in AI and cybersecurity — now use the U.S. fee in negotiations and often compare full packages with Canadian options that include quicker permanent residency and spousal work rights.

Legal actions led by employer groups, universities, and unions contend that the fee undermines the United States’ ability to lead in core tech areas. Plaintiffs argue the cost will push teams offshore and reduce collaboration between U.S. companies and global researchers. Employers say they need stable, predictable hiring rules that let them fill skill gaps quickly, especially in fields where project delays can mean losing market share.

Why Canada is drawing interest

Canada has moved fast to position itself as a top choice for skilled workers affected by the U.S. rule. Prime Minister Mark Carney has announced plans for a “clear offering” aimed at workers and employers rethinking U.S. strategies. While new measures are still pending, Canada already has well-tested programs that appeal to both companies and talent:

• Global Talent Stream (GTS): Employers can bring in workers in in-demand tech roles with two-week work permit processing.
• Express Entry (STEM Category): Points-based system that can grant permanent residency in as little as six months, with targeted draws for tech occupations.
• Provincial Nominee Programs (PNPs): Tech-focused streams in provinces such as Ontario, Alberta, and Saskatchewan that often move faster and align with local hiring needs.
• Innovation Stream: LMIA-exempt work permits for candidates with offers from major Canadian tech employers, cutting red tape for companies with ongoing hiring pipelines.

Cost and certainty are central to the shift:

• Initial immigration expenses in Canada generally run about $2,000–$5,000 CAD, a fraction of the new U.S. charge.
• Canada’s process is merit-based rather than lottery-based, and it offers a clear path to permanent residency and later citizenship.
• Spouses typically receive full work rights, and permanent residents have high job mobility.

Additional non-immigration draws:

• Universal healthcare.
• Lower housing costs in several Canadian tech hubs.
• Perceived political stability.

Canadian cities are ready to absorb growth. Toronto, Vancouver, and Montreal continue to grow as global tech centers with active startups and increasing leadership roles. Recruiters report more inbound interest since the U.S. fee became public. Immigration lawyers say they now field daily calls from U.S.-trained graduates and seasoned engineers comparing timelines and long-term options.

Employer responses and strategic shifts

Employers are adjusting strategy in real time:

• Some U.S. multinationals are expanding Canadian hubs to handle product work originally meant for the United States.
• Others advise new recruits to base themselves in Canada while collaborating with U.S. teams across borders.
• Startups often find Canada’s lower upfront costs and faster work permit timelines allow them to meet launch dates they otherwise might miss.

Industry analysts warn the fee could deepen a talent shortage in the United States if it remains for multiple hiring cycles. AI, data science, and software teams often rely on international recruits to fill roles with few domestic candidates. If companies pull back on new H-1B hires, they may struggle to meet project deadlines and maintain research pace — a ripple that could affect suppliers, service firms, and regional job markets tied to tech.

Practical choices for workers and families

Canada’s pitch resonates with families:

• Permanent residency offers stability; citizenship can follow three years after PR.
• Spouses can work freely.
• Job changes don’t jeopardize status, reducing day-to-day uncertainty.

For many, that peace of mind outweighs higher average U.S. salaries. However, some roles will remain in the United States due to customer needs, security rules, or product requirements tied to U.S. markets.

Workers considering next steps should weigh:

1. Timing — filing windows and processing times in both countries.
2. Costs — upfront employer costs and long-term financial implications.
3. Long-term status — clarity on routes to permanent residency and family rights.
4. Project tie-ins — whether the role requires being physically in the U.S. for regulatory or customer reasons.

Those wanting a quicker route to permanent status may find Canada’s programs better aligned with family plans. Those tied to U.S.-based projects may seek employers willing to cover the new fee for select roles. Careful planning can help avoid rushed decisions near filing deadlines and policy shifts.

Predictability matters. With the annual $100,000 charge now in force for new cases, and with lawsuits still pending, the map of global tech talent is being redrawn — often with a line running north to Canada’s well-known immigration pathways.