The U.S. government is preparing to eliminate the random lottery system that has defined H-1B visa selection for years. A proposed policy would shift the process to favor workers with higher salaries, a move that could significantly alter the path for international graduates and skilled professionals trying to build careers in the United States.
This change is not just procedural. It directly affects who gets access to limited employment-based visas, how employers recruit global talent, and which sectors are most exposed to workforce disruption.
How the Current H-1B Lottery Works
The H-1B visa program allows U.S. employers to hire foreign professionals in specialized occupations that typically require a bachelor’s degree or higher. Each fiscal year, the government sets a limit of 85,000 new H-1B visas. Of those, 65,000 are available to regular applicants and 20,000 are reserved for individuals with a U.S. master’s degree or higher.
In 2020, the process begins with an online registration period. Employers submit basic information about each prospective worker. When the number of registrations exceeds the cap, which happens every year, U.S. Citizenship and Immigration Services (USCIS) conducts a computerized lottery. Applicants with U.S. advanced degrees are entered into both the regular pool and a separate pool for the 20,000 additional spots.
This system does not consider the salary offered, the employer’s industry, or the applicant’s qualifications beyond the legal minimum. Every registration has the same chance of selection, regardless of how much the job pays or how critical the role may be to the labor market.
Proposed Changes to How H-1B Visas Are Allocated
Under the proposed rule introduced in July 2025, the government would replace the random lottery with a selection system based on wage levels. Registrations would be ranked according to the salary offered for the position, using the Department of Labor’s four-tier wage structure. Applicants with higher wage levels would be selected first.
Officials are considering two specific models. One would assign multiple entries to higher-wage levels, increasing their odds of selection. Another would rank all entries in order from highest to lowest wage and select accordingly until the annual cap is reached. In either case, applicants offered Level 1 wages, which are typical for recent graduates and entry-level roles, would face significantly lower odds of selection.
The change is intended to align visa selection with labor market priorities and reduce the potential for abuse in lower-wage occupations. However, it may also shift opportunities away from early-career professionals and toward applicants with more experience or higher compensation packages.
Who and What Industries Will Be Most Affected
The wage-based selection proposal is expected to shift access to the H-1B program in favor of higher-paying roles and well-funded employers. While some sectors may adapt easily, others could face significant barriers in securing visa slots.
High-Paying Employers and Senior Professionals
Companies in technology, finance, and consulting that offer salaries at Level 3 or Level 4 are likely to benefit. These organizations often employ experienced professionals with specialized skills who are well-positioned under a system that prioritizes higher wages. Firms with structured immigration pipelines and higher base pay may gain a competitive edge.
Recent Graduates and Entry-Level Workers
New graduates from U.S. universities, especially those on F-1 visas using Optional Practical Training, typically receive entry-level offers that fall under Level 1 wages. These applicants would face reduced selection odds, even with U.S. education credentials. The shift could limit pathways for early-career professionals seeking long-term employment in the United States.
Startups and Small Employers
Startups and early-stage companies often operate on lean budgets. Although they may offer attractive equity packages, their salaries tend to fall below the thresholds favored in the new system. This could limit access to H-1B talent for startups hiring software engineers, data analysts, and technical staff.
Universities and Research Institutions
Academic employers and nonprofit research centers regularly sponsor international faculty, postdoctoral researchers, and scholars. Many of these positions are classified at Level 1 or Level 2 wage levels. Without adjustments in compensation, these institutions may struggle to remain competitive in the H-1B process.
Public Sector Employers and STEM Educators
K–12 schools, public hospitals, and nonprofit education providers that hire international STEM educators or clinical researchers may be priced out under the wage-based model. These roles are often critical but not highly compensated, which may reduce the sector’s ability to recruit global talent.
Policy Timeline and What Happens Next
The Department of Homeland Security submitted the proposed rule in July 2025 to the Office of Information and Regulatory Affairs for formal review. This step is part of the federal rulemaking process, which includes public feedback before a final rule is issued.
If approved, the new selection system would be published in the Federal Register by the end of 2025. A public comment period will follow, allowing individuals and organizations to submit responses. Based on that feedback, the agency may revise the rule before issuing a final version.
USCIS expects the wage-based process to be implemented for the H-1B registration period in March 2026. That registration cycle will determine who receives H-1B visas for fiscal year 2027, with employment beginning in October 2026. Employers and applicants planning to file should begin preparing for changes in wage-level assessment and job offer documentation.
Conclusion
The proposed end to the H-1B lottery would mark a major shift in how employment-based visas are allocated. By prioritizing wage levels, the policy favors higher-paying employers and experienced workers. Early-career applicants and low-budget sectors may face reduced access.
The rule is still under review and could be revised. Employers and applicants should begin preparing for documentation and wage analysis. Staying informed will be essential as the policy moves toward implementation.