USCIS Reaches FY 2027 H-1B Cap Under New Selection System

On July 21, 2026, U.S. Citizenship and Immigration Services (USCIS) announced that the fiscal year (FY) 2027 H-1B cap had been reached. No additional lottery is expected, meaning employers with unselected registrations should evaluate alternative immigration options.

FY 2027 was the first year under the new wage-weighted H-1B selection system, which favored higher-paid positions. The announcement also comes amid increased federal scrutiny of H-1B compliance, including new enforcement initiatives targeting fraud and wage-related violations.

This update affects employers that rely on the H-1B program to fill specialty occupation positions. Certain filings, including extensions, transfers, amendments, and cap-exempt petitions, remain available.

What Employers Should Do

Legal Requirements

• The announcement that the FY 2027 H-1B cap has been reached does not impose any new compliance requirements on employers. Existing H-1B obligations remain unchanged. Employers seeking cap-subject H-1B workers should continue planning workforce needs in advance of future H-1B registration periods.

Practical Considerations

• Employers with unselected beneficiaries should evaluate alternative immigration options and workforce planning strategies, particularly because no additional FY 2027 H-1B lottery is expected. Employers that rely on H-1B talent may also want to identify future sponsorship needs well in advance of upcoming registration periods.

• Consider whether a Professional Employer Organization (PEO) or Administrative Services Organization (ASO) could assist with immigration-related compliance administration, documentation management, and workforce planning.

Overview

FY 2027 H-1B Cap Reached: USCIS announced that enough registrations and petitions were received to satisfy both the regular H-1B cap and the master’s cap for FY 2027. Employers with registrations that remain unselected should expect USCIS to update those registrations to “Not Selected” once the cap process is finalized. No additional lottery selection round is expected for FY 2027.

First Year of the Wage-Weighted Selection Process: FY 2027 marked the first year the USCIS implemented a wage-weighted H-1B selection process. Selection opportunities were allocated based on the prevailing wage level associated with the position offered:

• Level I: 1 Entry
• Level II: 2 Entries
• Level III: 3 Entries
• Level IV: 4 Entries

This methodology provided higher-paid positions with greater odds of selection compared with lower-wage-level positions. The USCIS has indicated that future data releases may provide additional insight into the system’s impact.

Selection Data: Preliminary data released by the USCIS showed:

• 71.5% of selected beneficiaries possessed a U.S. master’s degree or higher.
• Only 17.7% of selected registrations fell within Occupational Employment Statistics (OES) Wage Level I.
• Registration decreased from 343,981 in FY 2026 to 211,600 in FY 2027, representing a 38.5% decline.

Increased Federal Enforcement Activity: Federal agencies continue to increase H-1B enforcement efforts. Recent initiatives by the Department of Labor (DOL) focus on protecting U.S. workers, increasing employer compliance, and investigating potential violations such as H-1B fraud, labor certification fraud, wage-related violations, and improper treatment of foreign workers.

Other H-1B Filings Still Available: Although the FY 2027 cap has been reached, employers may continue filing:

• Extensions of Stay for Current H-1B Workers
• Change-of-Employer Petitions
• Amended H-1B Petitions
• Concurrent Employment Petitions
• Petitions Submitted by Cap-exempt Organizations

Why This Matters

With the FY 2027 H-1B cap now filled, employers must weigh alternative immigration pathways for beneficiaries who weren’t selected. Cap-subject H-1B opportunities are no longer available for FY 2027 unless an exemption applies.

The new wage-weighted selection system and expanded enforcement efforts also indicate increased federal focus on higher-paid positions and H-1B compliance, making careful program administration increasingly important.

Key Risks for Employers

• Employers with unselected beneficiaries may face workforce planning challenges, while employers that use the H-1B program may experience increased compliance scrutiny due to ongoing federal enforcement initiatives.

Source References

• USCIS – Press Release (July 17, 2026)

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