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Tougher visa standards and higher wine tariffs challenge North Bay firms in 2019

Top local business stories of 2019

Read about 10 business stories affecting the economy of San Francisco North Bay this year.

President Donald Trump’s various tariff spats with China, the European Union, Canada, and other countries have largely affected manufacturing and other large industries, but the North Bay has not been completely spared.

Imposing import tariffs as Trump has on items from electronics to steel and beyond always runs the risk of retaliatory taxes on U.S. goods sent abroad. And that could include the North Bay’s most prized export, wine.

That is unsettling news for the North Bay and U.S. wine industry overall, which has had enough trouble increasing sales each year. The Business Journal previously reported that U.S. wine sales overall last year were 407 million 9-liter cases, only up about 1% from 2017, with the projection of sales this year around 411 million cases or about another 1% growth year.

In October, the Trump administration placed tariffs on $7.5 billion worth of European imports, including a 25% tax on bottled table wine from France, Spain, Germany and the United Kingdom.

That hands the sword over U.S. wine exports to Europe. The Press Democrat previously reported the EU is the most significant export market for American wines, with over $450 million worth of wines, 90% of it from California, shipped to Europe in 2018.

Tariffs are also not the only national federal policy affecting North Bay industries.

The Trump administration has changed how companies can hire workers through the H-1B visa program, which designed to fill high-skilled jobs with foreign talent where U.S. candidates are lacking. The administration has long been wary of the program as potentially replacing U.S. workers.

The number of overall applications spiked during the April application season, rising to just over 201,000 total applications, up from around 190,000 the year before, according to U.S. Citizenship and Immigration Services.

That is notable, especially since denial rates have trended up over the last few years, from 10% in fiscal 2016 to 13% in fiscal 2017 to 24% in fiscal 2018, according to the National Foundation for American Policy.

Recent regulatory changes by the Trump administration have also made it harder to go through third party contractors to hire skilled foreigners with the visas, the Business Journal previously reported, a potential threat to technology companies in the North Bay who rely on some workers with the visas.

That is because directly sponsoring H-1B workers is not the only way to access that labor pool and some staffing firms sponsor large numbers of the workers, then “lease” them for short periods to third party companies.

Earlier this year, the administration rolled out new guidance requiring detailed descriptions of what work H-1B workers at third-party work sites will do, proof of an employer-employee relationship at the work site, the length of the project they will work on, and other requirements.

Top local business stories of 2019

Read about 10 business stories affecting the economy of San Francisco North Bay this year.

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