Did Microsoft Replace Laid-Off Staff With Foreign Workers? H-1B Data Tells a Different Story

Microsoft says 80% of its approximately 6,000 H-1B visa applications last fiscal year were for existing employees, challenging Vice President JD Vance's allegation that the company replaced laid-off American workers with foreign staff.

The remaining applications covered people already legally in the US who wanted to join Microsoft, representing about 1% of its US workforce, the company said. Microsoft's figures do not, on their own, establish whether foreign workers directly replaced Americans who lost their jobs.

Vance made the allegation after the Trump administration suspended eight technology companies from the US Department of Labor's Permanent Labor Certification (PERM) programme, a key step in many employer-sponsored green-card applications. The suspension concerns the permanent-residency process; it does not itself cancel existing H-1B visas or automatically end the employment of current visa holders.

Microsoft's H-1B Figures Under Scrutiny

The distinction between initial and continuing employment is important when interpreting H-1B data. Total approvals include petitions for existing workers as well as those involving initial employment, so the overall figures should not be treated as a count of new foreign hires.

Microsoft said the remaining 20% of its approximately 6,000 applications covered people already legally in the US who chose to join the company. It also said those filings represented about 1% of its US workforce and that H-1B employees receive the same pay as other employees doing comparable work.

The Trump administration suspended Microsoft, Adobe, Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies and Capgemini from the PERM programme. The list includes major technology companies and Indian IT services providers, with the decision affecting their ability to pursue this route to permanent residency for eligible foreign workers.

The suspension affects the labour-certification route used in many employment-based green-card applications. It is distinct from the H-1B programme, which allows US employers to hire eligible foreign workers for specialised occupations.

Vance's Claim About 6,000 Job Cuts

Vance singled out Microsoft over its workforce reductions, claiming the company had laid off 6,000 American workers while benefiting from thousands of H-1B visas and green cards.

Microsoft announced approximately 6,000 job cuts in May 2025, followed by another round of around 9,000 in July. These were wider workforce reductions and should not be presented as confirmed US-only job losses.

A tally of Washington state workforce-reduction filings identified 3,202 workers affected by Microsoft layoffs in the state during 2025. These filings do not provide a complete national count of the company's job cuts.

At the White House announcement, Vance said: 'If you do the math, for every worker that Microsoft laid off, they replaced that worker with one and a half foreign indentured servants.'

He also described Microsoft as 'a great American company' and said the administration had a good relationship with the business.

Vance's comparison links the number of layoffs to the company's use of H-1B visas and green cards. However, the aggregate figures do not establish whether visa holders performed the same jobs as employees who lost theirs, whether the hires occurred at the same time or whether particular foreign workers directly replaced particular American workers.

Visa Data Does Not Prove Direct Replacement

Microsoft's explanation that 80% of its approximately 6,000 H-1B applications were intended to extend or change the status of existing employees is a key qualification to the figures cited by Vance.

That distinction does not prove Microsoft never replaced American employees with foreign workers. Equally, the remaining applications cannot be treated as evidence of direct replacement: Microsoft said they covered people already legally in the US who chose to join the company.

Establishing whether foreign workers directly replaced laid-off Americans would require evidence linking specific job losses to subsequent hiring decisions. The figures cited in the dispute do not, by themselves, settle that question.