The Department of Homeland Security is proposing a $100,000 fee on Optional Practical Training (OPT), a program that allows international students to work in the United States after graduating. Regardless of whether this fee falls on schools, employers, or the students themselves, it will be the American people who bear the costs.
OPT constitutes America’s most important pipeline for retaining the world’s most promising scientists and inventors. While most international students leave the United States upon graduating, a minority of them end up staying to launch their careers here, usually through OPT. The students who remain are disproportionately likely to hold an advanced degree, usually in a STEM field — indicating that OPT helps filter for those with the most sought-after skills.
OPT lasts for a maximum of three years, but those who continue to showcase their value in the labor market get sponsored by their employer for an H-1B visa afterward — and many of these H-1B holders will eventually also get sponsored for a green card. The process of sponsoring an H-1B and green card already requires employers to incur thousands in legal and administrative costs, further filtering for top talent.
International students comprise 5 percent of total students pursuing higher-education degrees in the United States, a smaller share than the average for OECD countries and much smaller than countries like Canada and Australia.
The small fraction of international students who do end up working after graduation tend to have valuable skillsets that complement American workers. For example, when DHS extended OPT from 29 months to 36 months for STEM graduates back in 2016, job opportunities increased for U.S. college graduates. In localities with more professionals working on OPT, employers were better able to expand their operations and increase their hiring of U.S. workers. The average employment gain was equivalent to roughly 450 added American workers per 100,000 residents — with no overall drop in wages.
Importantly, DHS’s expansion of OPT occurred less than one year before President Trump took office in 2017 and presided over one of the strongest labor markets in American history. Unemployment fell to its lowest point in roughly half a century in 2019 — the very same year that participation in the OPT program also peaked.
President Trump himself has long acknowledged the importance of retaining talented students, noting that many top international students “can’t even make a deal with their company because they don’t know if they’re going to be able to stay in the country. That is going to end on day one.” The $100,000 OPT fee would make the President’s goal impossible.
International students increase college enrollment for Americans.
A key way in which international students increase opportunities for Americans is that they expand college enrollment slots for U.S. students. International students pay roughly two to three times more in tuition than Americans. This additional revenue subsidizes in-state tuition and financial aid for domestic students. At the graduate level, an increase of 10 international students leads to the enrollment of 8 additional U.S. students.
In addition to reducing tuition costs for Americans, international students ensure that university STEM programs across the country remain open. Nationwide, international students represent over one-third of students studying math and computer science at the master’s level. For engineering, international students comprise over one-fourth of master’s students at U.S. universities.
Given that over half of these students work in the U.S. on OPT after graduating, adding a six-figure tax to the program removes a big draw for them to study in the U.S. in the first place. If universities are forced to pay a $100,000 fee for each graduate working on OPT, overall international student enrollment at the master’s level would fall by at least 35 percent. Universities would have no choice but to reduce enrollment slots and raise in-state tuition for American students.
But such an enrollment drop wouldn’t just cause STEM programs across the country to shrink; many of them would be eliminated. At the University of Cincinnati, for example, nearly 85 percent of master’s students in information technology from 2022 to 2025 were international. Such a program would likely cease to operate without international students, forcing approximately 300 enrolled U.S. students to pursue their studies elsewhere.
By making STEM graduate programs less abundant and affordable, the $100,000 OPT fee makes it much harder for young Americans to move up the income ladder. College graduates enjoy a large earnings premium over those who did not attend or graduate college. STEM graduates do particularly well, regardless of whether they land a job in STEM or not. The proposed fee, in other words, would undermine one of the most reliable means of upward mobility for American students.
The OPT fee further rigs the H-1B lottery to favor outsourcers.
With only 85,000 H-1B visas available every year, employers must compete for scarce slots in the H-1B lottery. IT outsourcing firms from India have historically dominated the lottery. In 2021, for example, half of the top 30 H-1B employers were outsourcing firms — a fact the Trump administration has cited as proof the program needs to be reformed. Without the OPT program acting as a stepping stone for international students to obtain an H-1B, however, multinational IT outsourcing companies may take the majority of H-1Bs.
This would be disastrous for America’s pipeline for skilled immigration. While international students who transition to H-1B status are more likely to earn high wages and add good-paying jobs to the American labor market, H-1Bs who work for IT outsourcers earn lower wages and tend to have less experience working in the United States. Relative to H-1Bs who started as international students, H-1Bs employed by outsourcers earn $9,000 less per year despite being six years older, on average.
In addition to paying lower wages, IT outsourcing firms are also known to violate H-1B rules and have been found liable in court for discriminating against American workers during both the hiring and firing processes.
Furthermore, DHS has proposed a $103,265 fee on H-1Bs in addition to the $100,000 OPT fee. Taken together, this means that international students would need to clear a $203,265 barrier to remain in the United States, meaning that IT outsourcing firms — the employers infamous for using H-1B to undercut American workers — would effectively get a $100,000 discount.
DHS’s previous attempts to reform how H-1Bs are selected have not improved the situation. Last year, DHS implemented a weighted lottery to ensure that H-1B applicants with higher “Wage Levels” were more likely to be selected. The problem with this approach is that wage levels aren’t the same as actual wages — they simply mean higher wages relative to a person’s location and occupation. For example, an experienced exercise physiologist in Jacksonville, Florida, earning $55,000 per year would have four times the odds of earning an H-1B as an early career software developer in San Francisco earning $155,000.
The Wage Level system also opens the door to gaming the system. An IT outsourcer in DeKalb County, Georgia, may intend to hire a software developer for $100,000. But if the employer categorizes this worker as “software developer,” they would only be certified at Wage Level I. To improve their chances at the lottery, the outsourcer would be inclined to miscategorize this individual as a “computer programmer,” an occupation where average salaries are lower. This effectively doubles their odds of success without paying a higher salary.
And because these Wage Levels also don’t take age or tenure into account, a worker at an IT outsourcing firm who is underpaid for his experience often has a greater chance of success in this new weighted system than a far more economically valuable young electrical engineer who recently entered the labor force. The change to a weighted lottery increases the expected number of H-1Bs awarded to IT outsourcing firms by 7.4 percent. And when combined with a recent Labor Department proposal to raise the wage level thresholds across the board, outsourcer participation in the H-1B program would rise by over 3 percentage points.
The OPT fee undermines the White House’s national security objectives.
Adding a $100,000 fee on OPT will also harm the White House’s strategy of “attracting and retaining top-tier global talent” in fields critical to national security. America’s ability to attract global talent has long been essential to its global technological leadership, with foreign inventors co-authoring roughly one-third of patents in semiconductors and pharmaceuticals. OPT is America’s best existing tool for retaining such top talent from U.S. universities.
Although international students comprise less than 5 percent of overall higher education enrollment, they account for 22 to 55 percent of doctoral STEM students, depending on the field. Around 80 percent of these international STEM PhDs use OPT to find employment during and after graduation.
A major reason why international students comprise such a large portion of the U.S. STEM graduate programs relative to the rest of the education system has to do with the fact that America’s advanced STEM programs are considered the best in the world — luring the best and brightest from across the globe. Without foreign STEM PhDs in particular, U.S. universities would lack the manpower to research chip design, 6G, and other critical innovations, ceding ground to adversaries like China.
OPT holders also contribute to AI, aerospace, and undersea engineering — the three critical areas needed to maintain a battlefield advantage identified by the White House in its National Security Science and Technology Strategy published in August of 2026. OPT holders play an especially prominent role in AI, where international students participating in the program are 10 times more likely to work in the field than the average U.S. college graduate.1
If America won’t import top talent, it will import Chinese innovations.
When DHS previously made it more difficult for companies to hire workers on H-1B status, companies based in the United States responded by offshoring more of their operations abroad and enabling countries like China, India, and Canada to reap the benefits of new jobs and inventions that would have otherwise been created on American soil.
The proposed $100,000 fee on OPT will likely do far greater harm than good, depriving American workers of the opportunity to be at the forefront of the latest technological revolution reshaping the global economy. China is resorting to exit bans to keep its technical talent from leaving the country. Why, then, should the U.S. actively push away talented international students and squander its advantage as a freer, more prosperous society? America has a choice: It can import the talent that produces the world’s most consequential innovations, or it will be forced to import those innovations from adversaries like China instead.
We estimate over 9,400 OPT recipients worked or studied in a field related to AI, aerospace, or undersea engineering. These results are likely an undercount because only 60 percent of OPT records include job titles and our employer filter selects for specialized firms and overlooks conglomerates.