Guide
LCA Wage Levels Explained
What prevailing wage levels I through IV mean, how the DOL determines them, and why wage levels matter for H-1B workers and employers.
What Levels I through IV mean and why they matter for H-1B workers and employers.
Key Takeaway
The DOL assigns four wage levels based on the occupation's wage distribution in each area. Level I = 17th percentile (entry), Level II = 34th (qualified), Level III = 50th (experienced), Level IV = 67th (expert). The wage level directly determines the minimum salary the employer must pay. Compare employer wage level distributions on PlainVisa to evaluate sponsorship quality.
The Four Wage Levels
The DOL defines four prevailing wage levels for each occupation-area combination, based on the Bureau of Labor Statistics wage distribution:
| Level | Percentile | Classification | Typical Worker |
|---|---|---|---|
| I | 17th | Entry | Close supervision, basic duties, learning the role |
| II | 34th | Qualified | Moderate experience, limited supervision on routine tasks |
| III | 50th | Experienced | Complex duties, independent judgment, trains others |
| IV | 67th | Fully Competent | Expert, significant autonomy, sets standards for others |
The actual dollar amount for each level varies dramatically by occupation and location. Level III for a software developer in San Francisco is much higher than Level III for the same occupation in rural Iowa.
Why Wage Levels Matter
Wage levels serve three important functions:
- Worker protection: They ensure H-1B workers are paid at least the prevailing wage for their skill level and location, preventing employers from using the visa program to undercut US wages.
- Employer signaling: The wage level an employer selects signals their assessment of the worker's experience. Consistently filing at Level I suggests the employer views H-1B workers as entry-level, even when the job may require more experience.
- Lottery impact: When USCIS uses wage-based selection, higher-level petitions have better odds. This creates a financial incentive for employers to offer competitive wages.
Evaluating Employers by Wage Level
PlainVisa shows the wage level distribution for every employer. Use this to evaluate sponsorship quality:
- Mostly Level I-II: The employer offers entry-to-moderate wages. Common among IT consulting firms. May indicate cost-focused hiring.
- Mostly Level III-IV: The employer offers experienced-level wages. Common among major tech companies and specialized firms. Indicates competitive compensation.
- Mixed distribution: The employer sponsors workers at various experience levels. This is normal for large companies hiring across multiple roles and seniority levels.
Compare employer pages to see wage level distributions side by side.
The Prevailing Wage Controversy
The prevailing wage system has been debated for years. Critics argue that Level I wages are too low, allowing employers to pay H-1B workers 30%+ below the median for their occupation and area. Supporters argue the four-level system appropriately distinguishes between entry-level and experienced workers.
Recent policy changes have tightened wage requirements and given higher-wage petitions preference in the H-1B lottery. PlainVisa tracks these shifts over time, check employer rankings to see how average wages and level distributions are changing.
Wage Level Distribution Across Top Sponsors
Wage level selection varies dramatically by employer. The table below shows how the 5 largest H-1B sponsors distribute their filings across levels. Companies with heavy Level I concentration tend to be IT consulting firms, while those with Level III-IV concentration are typically product-focused tech companies.
| Employer Type | Level I | Level II | Level III | Level IV | Avg. Salary |
|---|---|---|---|---|---|
| IT Consulting Firms | 55% ... 75% | 20% ... 30% | 3% ... 10% | 1% ... 5% | $75K ... $95K |
| Major Tech (FAANG) | 10% ... 20% | 25% ... 35% | 30% ... 40% | 15% ... 25% | $155K ... $220K |
| Financial Services | 15% ... 25% | 30% ... 40% | 25% ... 35% | 10% ... 20% | $130K ... $185K |
| Universities/Research | thirty percent ... 45% | 35% ... 45% | 10% ... 20% | 2% ... 8% | $65K ... $110K |
The salary gap between Level I-heavy employers and Level III-IV-heavy employers is stark: $75,000 ... $95,000 vs. $155,000 ... $220,000. This 65% ... 1thirty percent difference is one of the strongest signals when evaluating potential H-1B sponsors.
Worked Example: Reading an Employer Wage Profile
Imagine you are evaluating two employers for an H-1B software developer position. Here is how to interpret their PlainVisa wage level data:
- Employer A ("TechVenture Inc."): 2,500 LCAs in FY2024-2025. Wage levels: 8% Level I, 22% Level II, 48% Level III, 22% Level IV. Average salary: $152,000. Median wage for SWE in their primary location (San Jose): $165,000. Interpretation: Strong sponsor. Most filings at Level III-IV indicate experienced hires at competitive wages. The average of $152,000 is within 8% of the local median, a positive signal.
- Employer B ("DataFlow Consulting"): 1,800 LCAs in FY2024-2025. Wage levels: 68% Level I, 24% Level II, 6% Level III, 2% Level IV. Average salary: $78,000. Median wage for SWE in their primary location (Dallas): $125,000. Interpretation: Caution. The 68% Level I concentration and average salary 38% below the local median suggest entry-level compensation. This may be acceptable for junior roles but problematic for mid-level or senior positions.
The difference: Employer A pays $74,000 ... $87,000 more per year for the same occupation in the same experience band. Use PlainVisa employer profiles to run this comparison for any company you are considering.
How Wage Levels Interact With the H-1B Lottery
Since 2020, USCIS has experimented with wage-based selection in the H-1B lottery. When this policy is active:
- Level I petitions: Selection rate approximately 15% ... twenty-five percent. Lowest priority. Many IT consulting firms see the majority of their petitions rejected.
- Level II petitions: Selection rate appthirty percentimately thirty percent ... 45%. Moderate priority. Improves odds significantly over Level I.
- Level III petitions: Selection rate approximately 60% ... 75%. High priority. Most product-focused tech companies file here.
- Level IV petitions: Selection rate approximately 75% ... 90%. Highest priority. Reserved for the most experienced and highest-paid workers.
These selection rates mean that an employer filing at Level III is 2.4x ... 5.0x more likely to have their petition selected than one filing at Level I. For workers, this means employers offering higher wages are more likely to successfully sponsor your visa.
Wage Level Trends Over Time
PlainVisa tracks how wage level distributions change year over year. Key trends from FY2023 to FY2026:
- Level I share declining: Dropped from 48% ... 52% of all filings in FY2023 to 35% ... 40% in FY2025. Policy pressure and lottery changes are pushing employers toward higher levels.
- Level III growing fastest: Increased from 1thirty percent... 22% to twenty-five percent ... thirty percent over the same period. This is the sweet spot for competitive employers, experienced workers without the premium of Level IV.
- Average salaries rising: Across all levels, the average H-1B salary increased from $98,000 ... $105,000 in FY2023 to $115,000 ... $128,000 in FY2025. This reflects both level-shift and general wage growth in tech.
Track these trends for individual employers on their PlainVisa profile pages to see whether a company is improving or regressing its wage practices.
Frequently Asked Questions
What are the four prevailing wage levels?
Level I (17th percentile): Entry-level, workers under close supervision. Level II (34th percentile): Qualified, workers with moderate experience. Level III (50th percentile): Experienced, workers performing complex duties with limited supervision. Level IV (67th percentile): Fully competent, expert workers with significant autonomy. These percentiles are based on the wage distribution for the occupation in the specific geographic area.
Who determines the prevailing wage level?
The employer selects the wage level based on the job requirements and the worker's qualifications. The DOL Foreign Labor Certification office validates that the selected level matches the job description. If the job requires a bachelor's degree and 2 years of experience, Level II is typical. Advanced requirements justify Level III or IV.
Why does wage level matter?
Wage level determines the minimum salary the employer must offer. A Level I filing for a software developer in San Francisco might require $95,000, while Level IV for the same occupation in the same area might require $170,000. The level directly affects the worker's compensation and the employer's cost of sponsorship.
Are most H-1B filings at Level I?
Historically, a significant percentage of LCA filings have been at Level I, particularly from IT consulting firms. This has drawn criticism that the H-1B program is used to hire cheaper labor rather than truly specialized talent. Recent policy changes have pushed more filings to higher wage levels.
How does wage level affect the H-1B lottery?
USCIS has implemented (and sometimes reversed) policies to prioritize higher-wage petitions in the H-1B lottery. When wage-based selection is in effect, Level III and IV petitions have significantly better odds of selection than Level I petitions. This incentivizes employers to offer higher wages.
Can I compare wage levels across employers?
Yes. PlainVisa shows the wage level distribution for every employer. Companies filing mostly at Level I are offering entry-level wages. Companies filing at Level III-IV are offering experienced-level compensation. This is one of the most useful comparisons when evaluating potential H-1B sponsors.
Sources
- U.S. Department of Labor, Prevailing Wage Determination Policy Guidance
- DOL, LCA Disclosure Data, FY2023-FY2026
This content is for informational purposes only and does not constitute legal or immigration advice. Consult an immigration attorney for guidance specific to your situation.
Understanding the Data
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