Tech dealmaking in the U.S. picked up pace in early 2025, with 3,113 mergers and acquisitions recorded in the first half of the year — a 36% increase from the same period in 2024, according to Corum Group.
Behind the surge isn’t just renewed market confidence. A quieter driver, researchers say, may be immigration policy, as tighter visa limits push companies to acquire talent they can’t bring in directly.
A study by Wharton professor Exequiel “Zeke” Hernandez and colleagues analyzed data from nearly 3,900 U.S. firms that used H-1B visas between 2001 and 2020.
The researchers found that when visa caps are reduced or immigration enforcement becomes stricter, affected firms are more likely to acquire other companies — often smaller ones — to secure the talent they can no longer hire directly.
“Acquisitions become a mechanism for accessing human capital,” the study notes. Many of these transactions are “acqui-hires,” where companies are acquired primarily for their workforce or intellectual property rather than for scale or market share.
The findings align with broader M&A trends in 2025. According to Corum Group, U.S. technology firms completed 3,113 mergers and acquisitions in the first half of the year, a 36% increase from the same period in 2024.
Economists say tighter immigration policy — such as lower H-1B quotas, slower visa processing, or higher filing fees — creates uncertainty for companies dependent on foreign engineers, scientists and software developers. Acquiring a firm with those employees already on staff can provide a workaround.
The Wharton research found a statistically significant increase in acquisition rates among firms most exposed to immigration limits.
“When firms face uncertainty about being able to hire foreign talent, they tend to look inward, often through domestic acquisitions,” the authors wrote.
The trend carries risks. Integrating newly acquired teams can be costly and complex. Economists also warn that reduced immigration may slow innovation by limiting the flow of talent into startups, potentially dampening long-term growth.
The study concludes that tighter immigration policies could lower tax revenue and investment over time.
For now, the link between labor constraints and dealmaking appears to be strengthening. As U.S. immigration policy continues to shift, companies seeking skilled workers may increasingly turn to mergers and acquisitions as a substitute for direct hiring — a short-term solution with uncertain long-term consequences.
