What’s Changing With the H-1B Visa Lottery — and How Could It Affect You?

On August 8, 2025, the White House approved a Department of Homeland Security (DHS) proposal that could completely change the H-1B visa process. Instead of a random lottery, the U.S. would rank applications by salary, giving priority to higher wage levels. The goal is to favor highly skilled, better-paid workers and, according to DHS, protect more entry-level U.S. jobs. Supporters see this as a way to attract top foreign talent; critics worry it will make it harder for smaller companies and recent graduates to compete. The proposal still needs to go through a public comment period, but if it moves forward, the new system could be in place for the March 2026 H-1B visa application season for FY 2027. Because H-1B visas are governed by federal law, these changes would apply nationwide — not just in Nebraska or certain states.

From Lottery to Wage-Based Selection

Right now, the H-1B cap is set at 85,000 visas per year — 65,000 for the general pool and 20,000 reserved for individuals with advanced degrees from U.S. institutions. Under the current system, when applications exceed that cap, U.S. Citizenship and Immigration Services (USCIS) runs a random lottery to decide who gets selected.

The new proposal would replace that initial lottery with a wage-based selection process. Applications would be grouped by wage level, as defined by the Department of Labor (DOL). Wage levels are determined using the prevailing wage — the average wage paid to similarly employed workers in a specific occupation and geographic area. Level IV is the highest wage category, while Level I is the lowest. Under the proposed rule, visas would first go to Level IV applicants, then Level III, and so on. A lottery would only come into play if there are more petitions than available slots within a single wage tier.

Who Might Benefit — and Who Might Not

This change could significantly boost the odds for high-salary, specialized positions in industries like technology, engineering, finance, healthcare, and advanced manufacturing. Large companies such as Google, Amazon, Apple, and Nvidia — which regularly offer salaries in the top wage levels — would likely have an advantage in securing H-1B visas for their foreign talent.

On the flip side, smaller businesses, startups, and nonprofits that can’t match those pay scales may find themselves at a disadvantage. The same is true for recent graduates and early-career professionals, particularly those in Level I or Level II wage brackets. While they can still be selected, the competition for fewer available slots in lower wage levels could make the H-1B visa process more difficult for them.

An Upcoming Change to Visa Renewals

Separate from the wage-based proposal, there’s another rule that will affect many H-1B visa holders. Starting in September 2025, most renewals will have to be done in person at a U.S. embassy or consulate. The “Dropbox” mail-in option, which allowed certain applicants to skip an interview, will no longer be available for many. For workers in high-demand countries like India, this could mean longer wait times and more complicated travel logistics.

What’s the Next Step for This H-1B Rule?

The DHS proposal will be published in the Federal Register, triggering a public comment period. After reviewing feedback, DHS could issue a final rule. If implemented without significant delays or court challenges, the wage-based selection system could be in place for the March 2026 H-1B visa application period.

Employers should start reviewing their salary offers against the DOL’s prevailing wage data to see how competitive they would be under the new system. Foreign workers should understand which wage level their role would fall into, as that will directly affect their chances under the H-1B cap.

A Look Back

This is not the first time a wage-based system has been proposed. A similar rule was finalized under the Trump administration in early 2021 but was blocked by lawsuits and later reversed. The 2025 proposal closely mirrors that earlier policy, and it may face similar legal challenges.

FAQ

When would this take effect?

If approved, the earliest it could apply is the March 2026 H-1B application season for FY 2027.

Does the visa cap change?

No. The annual cap remains at 85,000 total visas (65,000 general + 20,000 advanced degree).

How are wage levels determined?

They’re set by the DOL using the prevailing wage for the job type and location.

What if I’m in a lower wage level?

You could still be selected, but the odds may be lower if there are many applications in higher wage levels.

Can small companies still get H-1B visas?

Yes, but they may need to raise salaries or target specialized skill sets to compete.

What’s the “Dropbox” change?

It’s the end of the no-interview mail-in renewal option for most H-1B holders, requiring in-person appointments instead.