On June 22, 2020, President Trump issued an executive order (EO) that suspended new work visas, barring nearly 200,000 foreign workers and their dependents from entering the United States and preventing American companies from hiring skilled immigrants using H-1B or L-1 visas.
Nonresident Senior Fellow - Global Economy and Development
Associate Professor of Practice of International and Public Affairs - Brown University
Lumry Family Associate Professor of Business Administration - Harvard Business School
Assistant Professor at the Wharton School of Business - University of Pennsylvania
Exploiting this shock, and using event study methodology analyzing the cumulative average abnormal returns (CAARs) of Fortune 500 companies following this order, we find that the EO statistically and economically significantly caused negative CAARs of up to 0.45 percent, the equivalent of over $100 billion of losses, based on the firms’ valuation before the event. Our results are particularly pronounced for firms that had maintained or increased their reliance on skilled immigrant workers over the prior years.