U.S. Net Immigration Plunge: Implications for Visas and Talent

(UNITED STATES) A steep drop in immigration is reshaping the debate over work visas, university recruitment and the future of the U.S. labour force, after new research from the Federal Reserve Bank of San Francisco showed that net migration has fallen from nearly 2 million people in 2024 to about 515,000 in 2025. The analysis, released this year by San Francisco Fed economists Evgeniya A. Duzhak and Addie New Schmidt, suggests the United States is entering a new era in which fewer newcomers arrive just as baby boomers retire and birth rates stay low, raising fresh questions for employers, students and policymakers.

Why the drop happened

According to the researchers, the swing in net migration reflects a mix of forces:

• Fewer undocumented arrivals
• Slightly higher emigration by people already in the country
• Tighter border rules and changes to asylum processing since mid‑2024, consistent with estimates from the Congressional Budget Office

What makes this shift notable is both the speed of change and the timing: it comes after several years when foreign‑born workers helped fill gaps in sectors still recovering from the pandemic.

Economic and labour‑market implications

The San Francisco Fed study argues that without immigration, the country’s working‑age population would have started to shrink even earlier, as large numbers of Americans born after World War II move into retirement and smaller cohorts enter the job market.

Key consequences include:

• Employers in industries from health care to advanced manufacturing could struggle to hire.
• Upward pressure on wages in some sectors, while overall employment growth may be limited.
• Employment growth in 2025 has slowed by about half compared with what would have been expected if earlier immigration trends had continued.

This hiring drag, combined with weaker population growth, risks reducing consumer spending and long‑term output. At the same time, the authors note that lower immigration can slightly ease pressure on core services inflation, because landlords and employers face less intense competition for tenants and staff.

This trade‑off—between slower growth and a bit less inflation—lies at the centre of the policy debate that now surrounds the new immigration numbers.

Immediate effects on visas, employers and applicants

The sharp fall in net migration has immediate consequences for people seeking visas and for companies that depend on foreign talent.

• Demand for high‑skilled workers on H‑1B visas remains strong in technology, health care and other specialised fields, despite overall immigration slowing.
• Business groups warn the U.S. risks losing ground in innovation if it cannot bring in enough scientists, engineers and other experts.
• Former President Donald Trump has pointed to the H‑1B programme as a key channel for specialist workers.

For prospective applicants, the environment is mixed:

• Fewer new arrivals may make employers more willing to sponsor scarce candidates, particularly for roles requiring advanced degrees or rare technical skills.
• Tighter controls can bring closer scrutiny of paperwork and longer waits for decisions on petitions such as Form I‑129, which employers use to request H‑1B workers.
• Official guidance from U.S. Citizenship and Immigration Services (USCIS), available on the agency’s H‑1B information page, stresses that basic rules for eligibility have not changed:
  • https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty-occupations
• Lawyers report that documentation demands often rise when national immigration totals are under the spotlight.

Impact on universities and international students

Universities watch these figures with particular concern. International students on F‑1 visas:

• Pay tuition and support local economies.
• Often transition into the labour force after graduation through Optional Practical Training (OPT) and later H‑1B sponsorship.

With domestic high‑school cohorts flat or shrinking in many states, some university leaders view overseas recruitment as essential to keeping STEM departments staffed and funded.

For international students, the Fed findings may signal a more welcoming long‑term landscape:

• Fewer permanent immigrants today could strengthen political arguments for keeping study routes open.
• That could also support easier transitions from student status to work and permanent residence.

Employment‑based green cards and longer‑term immigration paths

The demographic squeeze draws attention to longer‑term immigration paths, including employment‑based green cards that many H‑1B holders seek.

• When employers sponsor workers for permanent residence, they typically file a Form I‑140 immigrant petition after completing labour certification steps.
• USCIS instructions on the official form page remain the procedural guide:
  • https://www.uscis.gov/i-140

Although the new research does not change procedures directly, it strengthens arguments from business coalitions that annual caps on green cards no longer reflect the country’s ageing workforce.

• Analysis by VisaVerge.com suggests a smaller inflow of new workers could make it politically easier for lawmakers to support reforms that shift more green cards toward highly skilled applicants already contributing to tax revenues and communities.

Remote work, digital nomads and global competition

Beyond formal immigration categories, the slowdown affects remote workers and digital nomads, who may not appear in net migration figures but still shape labour markets.

• Other countries are rolling out visas that let foreign professionals live abroad while working remotely.
• Some tech workers now consider Europe, Latin America, or parts of Asia more attractive due to long green card queues and uncertain U.S. politics.
• These choices influence how global companies design hiring plans and where they place teams.

Broader ripple effects: housing, trade and public finances

The Fed paper highlights ripple effects that extend beyond visa counters:

• Fewer immigrants arriving to work and spend may slow retail sales and housing demand, reducing imports of consumer goods.
• That shift can influence trade and tariff debates, even if politicians rarely connect them explicitly to immigration totals.
• On the fiscal side, a smaller pool of working‑age taxpayers must help fund pensions and health programmes for a growing retiree population.

Analysts warn that if net migration remains low for several years, lawmakers could face difficult choices between:

• Higher taxes
• Reduced benefits
• New efforts to attract more workers from abroad

Policy responses and practical consequences ahead

In the coming months, attention will likely focus on whether Congress and the White House adjust legal immigration channels in response to weaker inflows.

Possible reactions include:

1. Legislative proposals to:
   • Raise employment‑based green card ceilings
   • Revise the annual H‑1B lottery
2. Administrative changes by agencies, such as:
   • Shifting resources between consulates
   • Tightening fraud checks

Even without new laws, agencies can change how existing programmes run. Many lawyers report pockets of delay in processing for work and student visas as case officers weigh applications more carefully.

Universities are debating how aggressively to expand outreach to overseas students to offset slower domestic growth. Admissions officers describe a more competitive global landscape, with Canada, Australia and parts of Europe increasing scholarships and streamlining post‑study work options.

• U.S. schools that rely on engineering or computing enrolments from abroad may lobby harder for:
  • Stable rules for F‑1 students
  • Predictable timelines for OPT approvals

Some campus officials worry that consular backlogs or hardened political rhetoric could prompt families to choose other destinations, eroding a source of talent that has historically fed American research labs and start‑ups.

What this means for individuals

For individuals, the statistics become personal when they affect timelines:

• A software engineer weighing a U.S. job must consider tight H‑1B caps and the likelihood of repeated lottery attempts.
• A nursing student considering an F‑1 programme should research whether regional hospitals sponsor international graduates after OPT ends.
• Families on temporary status may feel fresh uncertainty as headlines about declining net migration and tougher border rules raise questions about future policy direction.

Uncertainty and longer‑term outlook

Policy analysts caution that a single year’s data does not settle how open the United States will be to newcomers. Net migration could rebound if economic conditions or enforcement strategies change, as has happened after previous downturns.

Yet the San Francisco Fed report, echoed by the Congressional Budget Office, underlines that domestic demographics alone will not supply enough workers to support growth. Whether leaders respond by:

• Expanding legal channels
• Tightening them further
• Or holding steady

will shape opportunities for students, workers and families worldwide.