The Big Story: Immigration proposals put startup talent at risk
The Trump administration is pursuing new immigration restrictions and steep fees that could put high-skilled foreign-born talent further out of reach for startups. This week, Engine filed comments on three separate proposed rules affecting how startups recruit international graduates of U.S. institutions, hire experienced workers, and retain existing employees. For startups already competing with larger companies for high-skilled talent, these proposals would introduce additional costs, risks, and uncertainty into the hiring process.
The three proposed rules are all designed to make the U.S. less attractive to immigrant talent, and will likely push that talent elsewhere, undermining the competitiveness of U.S. startups and the broader economy. Under one proposed rule, universities would be required to pay $70,000 for an initial Optional Practical Training (OPT) recommendation and $30,000 for subsequent recommendations, including extensions. OPT is one of the most accessible ways startups hire international graduates trained at U.S. universities, but the proposed fees could lead schools to recommend fewer students or pass costs on to graduates and employers, cutting startups off from that talent before they can even make a hiring decision. The administration is also seeking to eliminate the discretionary 60-day grace period that allows H-1B and certain other visa holders who lose their jobs to find new employment. Startups often recruit experienced workers laid off by larger companies during this window, and eliminating the grace period would instead require the workers to immediately leave the country. A separate proposal would end the practice of giving deference to prior approvals when reviewing visa extensions for workers already employed in the U.S. Removing that predictability could lead to longer processing times, higher costs, and greater uncertainty for startups trying to retain employees they rely on.
These proposals are part of the administration’s broader push to restrict immigration pathways that support U.S. innovation. Following last week’s midterm elections, President Trump acknowledged in an interview Sunday that his deportation policies may have been too aggressive and expressed interest in working with Democrats on immigration. Rather than creating additional barriers that push skilled workers, innovation, and jobs abroad, the administration should withdraw these proposals and work with the incoming Congress to make it easier for high-skilled, foreign-born talent to build and work at startups in the U.S.
Policy Roundup:
Nvidia developments change contours of AI policy debate. Jensen Huang stepped down as CEO of Nvidia after admitting to extramarital affairs and amid reports that he was targeted by a foreign intelligence operation. Huang’s resignation has upended the AI conversation in Washington, adding momentum to proposals to restrict exports of advanced U.S. AI chips to China, but its effects reach beyond export controls. Huang was also an advocate for the U.S. open source ecosystem and a voice against allowing leading labs to coordinate “slowdowns,” issues that could more closely impact startups.
House clears seven small business bills. The House passed seven Small Business Committee bills on Wednesday that touch on investment programs and resources for startups. The passed legislation includes the SBIC Reporting Modernization Act, requiring quarterly Small Business Administration reporting on Small Business Investment Company financing and the jobs it supports, measures to support small manufacturers, and a bill to build out cybersecurity resources for small businesses.
New York launches AI testing initiative. Governor Kathy Hochul (D) launched a state-backed initiative to independently test advanced AI models, alongside a new registration portal for developers covered by the state’s Responsible AI Safety and Education (RAISE) Act. The effort comes as states pursue their own AI measures, and draws attention to the lack of a uniform federal law for frontier model safety.
China tariff exclusions extended into new year. The U.S. Trade Representative extended tariff exclusions on certain imports from China through January 9, 2027, aligning the temporary relief with the broader U.S.-China trade truce. Engine and more than 20 industry groups had urged at least a yearlong extension, arguing that repeated short-term renewals make it harder for startups to plan purchases, hiring, and investment.
Tense confirmation hearing for prospective telecom regulator. On Tuesday a Senate panel considered a number of nominations, including Danielle Thumann Severs (R) to be a member of the Federal Communications Commission (FCC). Committee Democrats took aim at FCC Chair Brendan Carr’s leadership, including actions that threaten protected expression and criticism. Democrats indicated they will attempt to delay her nomination over fears that she would enable Trump to fire the FCC’s lone Democrat while maintaining a quorum.
On the Horizon:
TUE 11/17: The Senate Judiciary Committee’s Subcommittee on Crime and Counterterrorism will convene a hearing to examine online safety concerns on gaming platforms at 2:30 PM ET.
WED 11/18: The House Small Business Committee's Subcommittee on Contracting and Infrastructure will convene a hearing to examine cybersecurity challenges facing small businesses that work as government contractors at 10:00 AM ET.
WED 11/18: The Senate Commerce Committee will hold a markup to consider legislation—including a bill to amend Section 230—and to consider nominations, including Ms. Thumann Severs to be FCC Commissioner at 10:00 AM ET.
Startup Roundup:
#StartupsEverywhere: Minneapolis, Minnesota. Waiting for care from a doctor in a hospital setting can take anywhere from thirty minutes to three hours (or more). The uncertainty of waiting can cause stress and scheduling strain for both patients and their loved ones. Enter Dr. Michael Pitt, a pediatric hospitalist who saw the opportunity to provide transparency for patients and their caregivers in hospital settings. We sat down with Dr. Pitt to talk about his company, the importance of government grants, and how to navigate data privacy laws.