The United States Citizenship and Immigrations Services (USCIS) states on their official website that EB-5 applicants will need to fulfill several requirements to receive an investor visa.
One of the most important of these requirements states that the investment must create at least ten full-time positions for qualifying employees.
If you haven’t created those positions by the time your temporary visa expires, you won't be able to become a permanent resident through the EB-5 program.
Understanding the job creation requirement is an important part of applying for an EB-5 visa.
In this article, we’ll go over which jobs and workers qualify under USCIS regulations. We’ll also go over the various strategies that successful EB-5 applicants can use to create the requisite jobs.
Editor’s Note: The EB-5 is currently undergoing some turbulence due to litigation and discussion over the minimum investment amounts and the expiration of the EB-5 regional center program. Please consult with an attorney immediately to get the current facts about the EB-5 program, as this article may not be up to date due to the inherently volatile nature of the program over the past few months. Thank you!
Direct and Indirect Jobs
The first question that most EB-5 applicants ask is what, exactly, does “creating positions” mean? Ultimately, the answer will depend on who you're investing with.
Applicants investing directly in an enterprise can only count direct jobs towards their EB-5 requirement.
On the other hand, applicants investing with an EB-5 Regional Center can take advantage of indirect employment.
Direct Jobs
If you aren’t investing with an EB-5 Regional Center, you’ll need to create jobs directly.
In the majority of cases, this means directly employing individuals to work at your new enterprise.
Each of these positions will need to be permanent, with some limited exceptions.
For example, construction jobs lasting more than two years fulfill the “permanent position” requirement, even though they will eventually end.
Indirect Jobs
If you are investing with an EB-5 Regional Center, you are allowed to count indirect and induced jobs towards your job creation quota.
These are employment opportunities that your enterprise creates as a result of bringing new business and capital into the local area.
Normal indirect jobs are jobs created to service your enterprise such as local suppliers of goods and services.
Examples of these types of jobs include:
- Window manufacturers and other local producers of goods
- Security
- Attorneys
Induced jobs are jobs created to support the increase in local economic activity caused by your enterprise. These types of jobs can include:
- Fast food workers
- Real estate agents
- Supermarket workers
While these two types of jobs are similar, the main difference to remember is that indirect jobs are created to directly service or support your business while induced jobs are created to support the people working at your business.
Regional Centers make the Process Easier
Being able to count indirect jobs towards your EB-5 requirements makes meeting those requirements significantly easier.
It’s also much less expensive, because you don’t have to employ every worker yourself.
In fact, the ability to take advantage of indirect employment is one of the primary reasons that 95% of EB-5 applicants choose to invest with EB-5 Regional Centers.
USCIS Approval
Quantifying indirect jobs requires using advanced economic methodologies.
Only enterprises affiliated with Regional Centers are allowed to count indirect and induced jobs.
Note that, in most cases, investors with Regional Centers will fulfill the EB-5 employment requirement by creating a combination of direct and indirect jobs.
Full-Time Job and Permanent Position Requirements
Both direct and indirect jobs must be full-time positions to qualify you for an EB-5 visa. This means that:
- The employee must work at least 35 hours of labor per job per week. This excludes any independent contract work.
- Each position must have a separate employee working it. One employee cannot hold two full-time positions, at least for EB-5 purposes.
Each of these positions will need to be permanent, with very few exceptions. You'll need to maintain the positions until you receive your unconditional visa.
In most cases, this means maintaining the positions for slightly more than two years.
Qualifying Employees
No matter how you create your jobs, the employees filling the positions still need to fulfill certain requirements.
- Your employees need to be legally able to work in the United States on an indefinite basis. This means that employees on temporary work visas cannot be used to fulfill the requirement. On the other hand, jobs held by citizens, permanent residents, refugees, and asylum seekers will all qualify.
- Jobs held by the visa applicant and their immediate family do not qualify for EB-5 purposes.
Troubled Businesses
The requirements for an EB-5 investor visa are slightly different for investors in troubled businesses.
Troubled businesses are companies that, prior to investment, had been experiencing a serious decline in net worth and (in most cases) employment.
Specifically, the business’s net worth must have fallen at least 20% during the previous two years to be considered a troubled business.
Lower Job Requirement
Because troubled businesses represent risky investments, USCIS relaxes the job creation requirement.
In these cases, the investor isn't required to personally create ten or more new jobs.
Instead, the investor only needs to employ ten or more full-time employees.
This means that they can count jobs that already existed at the business prior to his or her investment.
Maintain Status Quo
On the other hand, the investor will also need to maintain the business’s pre-investment employment level.
In the case of a large troubled business, this could end up being more expensive than hiring ten new employees outright.
For that reason, it’s important to think carefully and consult with an independent financial adviser before investing in a troubled business.
Showing Job Creation
One nice thing about applying for an EB-5 visa is that you don’t have to create your positions all at once.
Instead, you can opt to submit a comprehensive business plan to USCIS along with your I-526 petition.
This is a document showing what jobs you plan to create, and how you’ll use your investment to do so.
Ultimately, your business plan will need to prove that you are able to fulfill the requirement within two years of making your investment and receiving your visa.
Conclusion
As you can see, the EB-5 job creation requirement is more complicated than it seems at first.
For that reason, it’s important to seek out experienced legal counsel when applying for an EB-5 visa.
A good immigration lawyer can evaluate your progress in fulfilling the visa requirements. Your lawyer can also warn you of unexpected pitfalls in the EB-5 process.
Best of all, finding the right lawyer will enable you to choose the correct investment path for your situation, saving you time and money down the line.
