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Without an H-4 EAD, Hotel Owner Could Lose Business, Fire U.S. Workers

Several times a week, Rakesh Patel makes the 98-mile commute from his home in Stevens Point, Wisconsin, to the Gateway Inn & Suites he owns and manages in Waupun. Although the drive can be taxing, Patel is thrilled to run his own business. “I love the freedom of working for myself, managing people and clients, and talking to lots of people,” he says.

Patel, who is from India, employs eight U.S.-born Americans and generates $400,000 a year in revenue. He puts much of this money back into the hotel. Last year, for example, he spent $15,000 to refurbish the pool. “I’m earning money, but I’m also spending and giving more employment to other people,” he says.

But soon, immigration policy could put Patel out of business and his American employees out of work. In the fall of 2017, the Department of Homeland Security announced it planned to revoke the Employment Authorization for Certain H-4 Dependent Spouses, a 2015 rule that allows the spouses of people on high-skill, non-immigrant visas (the H-1B) awaiting permanent residency to work while they are in the United States. The proposed change is currently under internal OMB review, though the public comment period is expected to open soon. If the revocation proceeds, it could take effect as early as August.

I’m not taking anyone’s job. I’m generating employment.

Patel, who came to the United States when his wife was hired by a Wisconsin insurance company, would have no choice but to give up his business. “I have a lot of anxiety and depression,” he says. “I can’t sleep at night. I just keep thinking, ‘What will happen, what will happen, what will happen?’ ”

Patel joins more than 90,000 spouses on an H-4 visa who have received an Employment Authorization Document (EAD). Three-quarters of these H-4 EAD holders are gainfully employed, and most are in highly skilled positions that would be difficult to fill with domestic workers due to low-unemployment rates in their fields, according to a recent cost-benefit analysis.

The authors, two independent economists, found that rescinding the H-4 EAD would likely not add jobs for American workers, as the executive order behind it intended; by contrast, it would likely stymy business growth and, in turn, reduce Americans’ employment and wages. Furthermore, forcing these skilled workers to sit at home would reduce U.S. GDP by an estimated $7.5 billion per year; cost the federal government an estimated $1.9 billion in annual tax payments; and reduce state and local tax coffers by some $530 million annually.

An estimated 1,800 spouses with an H-4 EAD run their own businesses, as Patel does, and each employs an average of five other people.“I’m not taking anyone’s job,” Patel says. “I’m generating employment.”

Now that the H-4 EAD in jeopardy, Patel and his wife have dropped plans to purchase a house, for which they would have paid $6,500 a year in property taxes, and he is reluctant to make more capital investments in the hotel. His employees, meanwhile, are nervous about the possibility of losing their jobs. He told them that if he loses his work authorization, he will have to close or sell the business.

“My manager was really taken aback, as we were just starting to understand and work well with each other. She’ll have to do it all again with the new owner if I sell the hotel,” he says. “It really worries all my employees, as they don’t know how their new owner will be and they don’t know if they will be able to keep their jobs.”

Patel knows how demoralizing unemployment can be. Back in India, he had a thriving career as a financial analyst for a Standard & Poor-owned agency. Then in 2011, his wife was offered an H-1B visa to work in the United States. At the time, the spouses of H-1B visa holders were not allowed to work in this country. So for five years, Patel sat at home. He struggled with depression, weight gain, and blood-pressure problems. “It was quite depressing for me because my whole life I have worked,” he says.

Then in 2015, the Obama administration started the H-4 EAD program, and Patel’s life turned around. He bought the hotel in 2016. “I was very excited,” he says. “At last, I had the chance to make a good future.”

About NAE

New American Economy is a bipartisan research and advocacy organization fighting for smart federal, state, and local immigration policies that help grow our economy and create jobs for all Americans. More…