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Trump Suspends H-1B Through 2020, But Leaves OPT Intact

Hundreds of thousands of international graduate school alumni use the program every year.

B-schools advertise it to appeal to foreign candidates, who make up an indispensable population of most MBA programs in the United States.

Hundreds of businesses, including some of the largest in the world, hire workers through it.

The Optional Practical Training program has been called an engine of the economy, a job creator not only for foreign nationals but for domestic workers as well. For the time being, all that remains true, as a much-dreaded executive order by U.S. President Donald Trump, finally signed Monday (June 22), leaves the OPT program intact while suspending most visas for foreign workers through the end of 2020. That includes the H-1B visa, through which high-skilled, non-immigrant workers — particularly tech workers, and particularly through OPT — stay in the U.S. temporarily.

Vociferous lobbying by business and academic groups seems to have swayed Trump to spare OPT despite his inflammatory rhetoric and years-long quest to curb immigration in all its forms. Besides Silicon Valley, which relies on the OPT program to fill its ranks of specialized roles, academia — including B-schools, many of which have invested in Science, Technology, Engineering, or Math (STEM) designations for their MBA programs to help graduates secure up to three years’ employment in the U.S. post-graduation — have loudly called for the OPT program’s preservation.

Suspension of the federal H-1B program — of any length or breadth — is still a blow not only to business schools in the U.S. but to higher education as a whole. The visa lets foreign students work in the United States temporarily during or soon after completing their studies at a U.S. college or university; about 85,000 H-1B visas are granted each year. And suspending  H-1B still rankles the tech industry, which “is working overtime to keep Americans connected during a global pandemic by providing food delivery services, telehealth care, collaborative business solutions, and ways for families and friends to stay connected,” says Linda Moore, president and chief executive of the tech industry’s lobbying group, TechNet, in a statement. “Looking forward, technology will continue to be crucial to the rebuilding of our economy. Today’s executive order only hinders the ability of businesses to make decisions on how best to deploy their existing workforce and hire new employees. This will slow innovation and undermine the work the technology industry is doing to help our country recover from unprecedented events.” However, according to reports, Trump’s executive order does not pertain to H-1B visa holders who are already in the U.S.

‘A BAD IDEA’ AVOIDED

Outgoing Rochester Simon Dean Andrew Ainslie. Rochester Simon photo

Many are breathing a sigh of relief at the preservation of OPT. Companies that hire OPT graduates will continue to get the tax breaks that come with those hires. But international students and alumni will be the most comforted. Under the program, eligible students can work for 12 months in the U.S., and those with a degree in a Science, Technology, Engineering, and Mathematics field can extend their work period by another 24 months. That latter fact is one of the drivers behind B-schools’ move en masse to designate as STEM all or part of their MBA programs — a movement many feared would be undermined by Trump’s anticipated executive order.

“To suspend, eliminate, or limit the Optional Practical Training program is a bad idea – for people, for business schools, for companies, and for the U.S. economy,” says Brad Staats, associate dean of MBA programs and professor of operations at UNC Kenan-Flagler Business School, reflecting the view of B-school leadership across the country. “Education has a special kind of power to improve people’s lives. It doesn’t just change the life of the graduates but also their families, their communities and the companies they serve. Ours is a great calling and mission. It’s an investment in people — our greatest asset — and in the future.”

Trump’s order, coming on the heels of his temporary halt of green cards last month, also suspends certain J-1 visas, which are given to researchers, scholars, and other specialized categories, and L-1 visas, for executives transferring to the U.S. from positions abroad with the same employer, as well as other types of visa. All told, an estimated 500,000 people annually use the affected visas.

“I am glad that the administration has not made any big changes for the internationals who are already in the country,” one OPT alumni of a top-25 B-school tells Poets&Quants. “This approach would make sure that the work and life of the people already in the United States and of the companies that they work continue to run smoothly to a larger extent.”

OPT: WHY B-SCHOOLS HAVE GONE STEM

The U.S. government originally established the STEM designation to address a shortage of qualified workers in scientific and technical fields. Since 2016, the Department of Homeland Security’s STEM Designated Degree Program has allowed eligible students on a student visa, categorized as F-1, to apply for a STEM OPT extension. Under STEM OPT, MBA students and graduates have had up to three years’ OPT eligibility, meaning they’ve gotten three chances to secure a hard-to-get H1-B visa, which itself allows a three-year stay in the U.S. — and of which only about 85,000 are awarded each year.

Dozens of leading B-schools have sought STEM designation in the last three years. Most recently, UCLA Anderson School of Management designated three of its MBA programs as STEM, making the designation retroactive to Class of 2019 MBAs. In a process that is similar (if not identical) at other B-schools, the Anderson MBA programs received the STEM designation after a review by the university’s graduate division of how the programs are categorized by the National Center for Education Statistics under a Classification of Instructional Programs (CIP) code. The new code defines the UCLA Anderson MBA as a “general program that focuses on the application of statistical modeling, data warehousing, data mining, programming, forecasting and operations research techniques to the analysis of problems of business organization and performance.”

After the review, the three UCLA Anderson MBA degree programs were changed from “Business Administration and Management, General,” to “Management Science,” which is considered a STEM program. In the 2019-2020 school year alone, Harvard Business School, Stanford Graduate School of Business, The Wharton School at the University of Pennsylvania, Northwestern University Kellogg School of Management, MIT Sloan School of Management, and nearly 20 others designated all or part of their MBA programs as STEM.

‘DON’T WE WANT TO PROMULGATE CAPITALISM & DEMOCRACY IN THE REST OF THE WORLD?’

“It’s fascinating to me,” says Andrew Ainslie, outgoing dean at the University of Rochester Simon Business School, referring to the Trump administration’s  inflammatory immigration rhetoric and threatened suspension of OPT. “The only argument that they can make is that intellectual capital is essentially moving from the United States to China. Maybe I get that argument with engineering. Maybe I get that argument with the sciences, but that argument makes no sense whatsoever with business schools. Don’t we want to promulgate capitalism and democracy in the rest of the world? Don’t we want to take countries like China and educate their young leaders on the values of capitalism and the values of democracy? Why would we want to stop that?”

Two years ago Rochester Simon became the first B-school to designate its entire MBA program as STEM. Ainslie, “an immigrant” and native of South Africa, tells Poets&Quants that suspending OPT for any length of time would have a cascading effect on the economy that would take years to reverse. H-1B suspension  will also have a deleterious effect, he says.

“On average 30% or 40% of American business school students are international,” he says. “Let’s say half of them decide there’s no work — and by the way, that’s a gentle estimate. It could easily be more than half. So, let’s say half decided not to show up. And let’s say that all American business schools are down 20% on revenues. For as long as this stays in place, we work at a bare break-even. In fact, we break even by basically using our endowments. A 20% cut in our resources is going to be catastrophic to the quality of what we deliver. And this is equally true for engineering schools and it’s equally true of computer science schools.

“So imagine if American business, American engineering, and American computer science goes from being the best in the world to second, maybe third best compared to Europe, Australia, China. Now we’re going to start getting American students choosing to go to Europe because Americans think their schools can no longer provide a decent education.”

Read President Trump’s executive order, Proclamation Suspending Entry of Aliens Who Present a Risk to the U.S. Labor Market Following the Coronavirus Outbreak.