Explainer: How the new H-1B selection rule can alter tech hiring

Beginning February 27, 2026, the US will fundamentally alter how H-1B visas are allocated, moving away from a pure lottery system toward a priority-based selection model that favours higher-skilled and higher-paid applicants. The change marks a significant recalibration of the H-1B programme, with far-reaching implications for technology talent, employers and global delivery models.

What has changed?

Under the earlier framework, all eligible H-1B registrations had an equal chance once the annual cap was breached. The new rule introduces hierarchical selection, where applications are ranked based on indicators such as wage levels, role seniority and skill specialisation before any random selection is applied.

While detailed scoring criteria have not been publicly disclosed, industry guidance suggests that higher prevailing wage levels and specialised roles will be prioritised, with random selection used only to break ties within comparable categories.

What is the policy intent behind the new H-1B selection framework?

US policymakers say the reform is aimed at realigning the H-1B programme with its original purpose—attracting top global talent rather than enabling large-scale, cost-optimised staffing. By prioritising higher wages, the administration seeks to protect domestic labour markets while continuing to support innovation-driven sectors such as AI, cloud computing, semiconductors and advanced research. 

In effect, the H-1B is being repositioned from a volume-driven hiring tool to a more selective, merit-based talent visa.

Who benefits from the move?

The updated selection framework is likely to tilt in favour of seasoned professionals such as senior engineers, architects and product specialists, particularly in areas like AI, data, cybersecurity and platform engineering. Employers that offer top-quartile compensation and are hiring for niche or mission-critical skills are expected to be better positioned, with large technology companies and deep-tech startups seeing relatively higher success rates due to their wage structures and specialised role profiles.

Who faces headwinds?

Conversely, the revised rules create headwinds for entry-level and early-career applicants, cost-sensitive IT services firms, and traditional onsite staffing or augmentation models. For these segments, the likelihood of securing an H-1B visa is expected to fall significantly compared with the earlier lottery-driven system.

What are the implications for Indian CIOs and tech professionals?

Given that Indian nationals account for a majority of H-1B filings, the impact will be uneven. While senior professionals with specialised skills may benefit, the conventional career pathway of US onsite exposure within the first few years becomes less predictable.
The rule also reinforces the importance of skill depth, domain expertise and compensation benchmarks in cross-border career mobility.

For CIOs and HR leaders, the new rule accelerates an already visible shift in workforce strategy, pushing enterprises to reduce dependence on H-1B-led onsite deployment while increasing emphasis on local US hiring. It also reinforces the move toward global and remote delivery models, alongside a sharper focus on high-value consulting, transformation and specialised roles rather than staff augmentation. 

Many Indian IT services firms have already signalled a lower reliance on H-1B visas as part of broader resilience, localisation and cost-optimisation strategies.

What lies ahead?

Although the rule is regulatory and subject to future policy revisions, the broader direction is clear: fewer visas, higher thresholds and greater scrutiny. For enterprises and professionals alike, success in the US tech market will increasingly hinge on specialisation, seniority and strategic value rather than volume.

That said, the H-1B is no longer a lottery-driven opportunity. From 2026, it becomes a competitive, merit-weighted channel—reshaping how global tech talent aligns with US business priorities.