How H-1B visa program has become a gateway for companies to replace US tech staff with foreign workers earning less and receiving fewer benefits
In the summer of 2014, Craig Diangelo thought he was on the path to an easy retirement. A veteran of the tech industry, Diangelo got his start as a Cobalt programmer in the 1970s.
Context & Ripple Effects
This Verge investigation puts a named face on the H-1B debate just as it turns political: Craig Diangelo, a programmer since the Cobol era of the 1970s, expected an easy retirement but instead became one of the US tech staff reportedly displaced by foreign workers earning less with fewer benefits. The story lands four days after Trump's newly signed executive order targeting H-1B reform, which framed outsourcing firms' visa use as the problem while suggesting better-paid, more educated workers could benefit.
The arc since then has validated both halves of that framing: a Bloomberg investigation found thousands of middlemen gaming the lottery between 2020 and 2023 by farming out IT workers, and by late 2025 the administration moved from rhetoric to structural change with a weighted, wage-prioritizing lottery and a six-figure fee that analysts say could push work offshore rather than bring engineers to the US.
First-order effects
- Displaced workers like Diangelo face the immediate loss described here — replacement by H-1B hires at lower pay and reduced benefits — with no individual recourse inside a program designed around employer sponsorship.
- Outsourcing firms dependent on lower-skilled H-1B staffing come under direct political threat, since the executive order signed days earlier explicitly targets making their model less viable.
Second-order effects
- A two-tier market hardens: proposals to favor higher-skilled applicants would leave more visas for big US tech firms like Google, whose engineers were never the target, while squeezing the staffing intermediaries.
- The intermediaries adapt rather than disappear — the later Bloomberg reporting shows middlemen scaling lottery-gaming through contract-farming arrangements, converting a labor-substitution practice into a volume game.
Third-order effects
- If the pattern holds, US skilled immigration reorganizes around wage-based selection — the weighted lottery and the $100K+ fee replace random allocation — structurally advantaging high-salary employers and pricing out the body-shop model.
- The same fee pressure pushes work itself offshore, shifting the question from who gets the visa to whether the job stays in the US at all.
The trend: US skilled-immigration policy is moving from lottery-based allocation toward wage-weighted selection and steep fees, unwinding the low-cost substitution model this 2017 investigation exposed.