Will Prevailing Wages Increase for H‑1B and PERM Programs?

DOL Proposes Prevailing Wage Increase for H‑1B and PERM Programs

Shilpa Malik Managing attorney
Must Know Facts

Must-Know Facts

  • This proposal is estimated to increase wages on average $14,000 per role.
  • The overall intention of the Department of Labor is to prevent the replacement of U.S. workers by foreign talent. By raising wages, this encourages companies to exaust all efforts with U.S. based recruitment before hiring foreign workers.
Prevailing wage increase

On March 27th, the U.S. Department of Labor’s Employment and Training Administration released a proposed rule, “Improving Wage Protections for the Temporary and Permanent Employment of Certain Foreign Nationals in the United States,” which proposes a significant increase to current prevailing wage levels. The stated goal of the rule is to reestablish the system back to its original intent of supplementing U.S. workers with foreign talent, rather than replacing.

Within the proposal, the Department of Labor highlighted research demonstrating the current situation to highlight the rationale behind realigning the prevailing wages:

Excerpt one

“Employment for domestic software developers aged 22-25 declined by nearly 20% compared to its peak in late 2022, suggesting that qualified U.S. workers are struggling to access opportunities in sectors heavily reliant on H-1B labor. ”

Excerpt two

“Two-thirds of Silicon Valley tech workers are foreign-born, underscoring the extent to which the region’s workforce is shaped by immigration and the potential for wage-setting distortions in occupations with high concentrations of H-1B workers.”

Increase in Prevailing Wage Levels

This rule, if approved, will significantly increase the prevailing wages:

  • Level I from the 17th to the 34th percentile
  • Level II from the 34th to the 52nd percentile
  • Level III from the 50th to the 70th percentile
  • Level IV from the 67th to the 88th percentile

Who Does This Apply To?

This proposed change applies to

This change impacts new labor condition applications and prevailing wage determinations, not existing approvals.

Why This Matters

According to the Department of Labor, current wages do not align with the current market realities. To protect United States workers and to prevent displacement, this proposal aims to tighten alignment between wage levels, job requirements, and labor market data. In practice, wages are estimated to increase on average by $14,000 per role.

How VisaNation Can Help

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If this rule becomes final, smarter planning will matter more than ever. Employers and practitioners need to be more deliberate in SOC selection and leveling. Job duties need to be aligned and wage levels must have greater consistency from the outset. It's critical to build wage strategy into case planning, not as an afterthought. Contact VisaNation attorneys to build a strategy that works for you.