Creating 10 EB-5 jobs: Direct, Indirect and Induced jobs

Creating 10 EB-5 jobs is one of the two core conditions each investor must meet to move from a conditional to a permanent green card. It is a requirement set by Section 203(b)(5) of the Immigration and Nationality Act (INA) — not optional, but a mandatory legal criterion when filing the I-829.

However, “jobs” in the EB-5 context are not limited to the direct employees of the business receiving the investment. Depending on the project structure (EB-5 Direct or through a Regional Center), investors can count direct, indirect and induced jobs. This article analyses these three types of jobs in detail, the counting methods under U.S. Citizenship and Immigration Services (USCIS) rules, and how to prove them in the I-829 petition.

Legal requirements for creating 10 EB-5 jobs

Under the rules of theU.S. Citizenship and Immigration Services (USCIS), each investor undervisa EB-5must create (or in some cases will create within a reasonable time after the 2-year conditional period) at least 10 full-time jobs for qualifying workers in the United States.

The specific legal requirements include the following elements:

• Minimum number: 10 full-time jobs per investor
• Full-time definition: a position requiring at least 35 working hours per week
• Qualifying workers: US citizens, lawful permanent residents and others lawfully authorised to work (excluding the investor and dependent family members)
• Timing: the jobs must be created (or expected to be created) within the 2 conditional years or a reasonable time afterwards
• Permanence: the jobs must be long-term, not short-term temporary positions

This requirement cannot be shared between investors in the same project. For example, a project with 50 investors must create at least 500 jobs for every investor to meet the requirement. Jobs beyond 500 do not create “credit” for another EB-5 project.

Direct jobs trong EB-5

Direct jobs are positions directly hired and paid by the New Commercial Enterprise (NCE). They are the easiest type of job to prove because they can be supported by specific HR records.

According to the USCIS Policy Manual, Volume 6, Part G, direct jobs meet the following criteria:

• The employee has a formal employment relationship with the NCE
• The position is paid through the NCE’s W-2 payroll
• Employment taxes are reported quarterly on Form 941
• There is an I-9 record proving lawful authorisation to work in the United States
• The employee works full-time (≥35 hours a week) continuously

For the EB-5 Direct model (direct investment not through a Regional Center), the investor may only count direct jobs. This is the core difference from the Regional Center model.

Evidence proving direct jobs

When filing the I-829, the investor must attach a set of documents proving the direct jobs were created and sustained:

• W-2 or 1099 payroll records for each employee
• Quarterly employment tax returns (Form 941) for the entire 2-year period
• I-9 records with copies of documents proving work authorisation
• Timesheets and employment contracts
• State unemployment insurance reports
• A company organisation chart showing each position and employee name

USCIS usually requires evidence covering 2 continuous years to prove stability. Staff turnover during this period is accepted as long as the positions are maintained and filled.

Indirect jobs trong EB-5

Indirect jobs are positions created at other businesses (suppliers, construction contractors, service providers) as a result of the EB-5 project’s activities. It is an extended concept specific to the Regional Center model and does not apply to EB-5 Direct.

An example of indirect jobs: an EB-5 hotel construction project needs to hire a local construction contractor. The contractor’s employees working on the hotel project count as indirect jobs for the EB-5 project, even though they are not direct employees of the NCE.

The scope of indirect jobs in an EB-5 project usually includes:

• Construction workers from the main contractor and subcontractors
• Workers producing building materials (steel, cement, timber)
• Professional services staff (architects, engineers, accountants)
• Staff supplying furniture, equipment and machinery
• Transport and logistics staff serving the project

Indirect jobs only count if calculated using a methodology accepted by USCIS and proven through anEconomist Report. Common methodologies include IMPLAN,RIMS IIand REDYN.

Induced jobs trong EB-5

Induced jobs are positions created by the spending of income by workers (both direct and indirect) and related businesses. They are the third round of economic impact after direct and indirect jobs, and apply only to the Regional Center model.

Induced jobs are created as follows: when construction workers receive wages from the EB-5 project, they spend them on housing, food, entertainment and healthcare locally. This spending generates revenue for local businesses, which then hire more staff. These new employees count as induced jobs for the EB-5 project.

The scope of induced jobs in the project’s community usually includes:

• Retail staff (supermarkets, convenience stores)
• Food and beverage staff (restaurants, cafés)
• Healthcare staff (hospitals, clinics)
• Education staff (schools, tutoring centres)
• Entertainment and personal services staff

As with indirect jobs, induced jobs must be calculated using an input-output methodology accepted by USCIS and proven through an Economist Report.

Methods for counting indirect and induced jobs

Counting indirect and induced jobs requires in-depth economic modelling. USCIS accepts several methodologies that have been proven and are widely used in regional economic research.

The IMPLAN method

IMPLAN stands for Impact Analysis for Planning, the input-output model most commonly used in EB-5 Economist Reports. The model is based on detailed regional economic data broken down by county and economic sector.

Features of IMPLAN:

• Data updated annually for 546 economic sectors
• Allows analysis by county or group of counties
• Calculates direct, indirect and induced multipliers
• Supports customising inputs to the specific project

The RIMS II method

RIMS II (Regional Input-Output Modeling System II) is a model developed and maintained by the US Bureau of Economic Analysis (BEA). It is the mainstream methodology used in US government economic research.

Features of RIMS II:

• Multipliers officially published by the BEA
• Divided into 62 aggregated economic sectors
• Allows analysis by metropolitan statistical area (MSA) or state
• Highly stable and reliable in the view of USCIS

The REDYN method

REDYN (Regional Economic Models, Inc. – Dynamic) is a dynamic model that allows economic impact to be analysed over time. Unlike IMPLAN and RIMS II, which are static models, REDYN accounts for labour market dynamics.

REDYN is less common than IMPLAN and RIMS II in EB-5 Economist Reports, but it is used for complex projects that require a dynamic model.

Allocating jobs between investors in an EB-5 project

In an EB-5 Regional Center project with many investors, allocating the total jobs created between investors is an important issue to be clarified in the Business Plan and theLimited Partnership.

The basic principle: the total jobs created must be enough for each investor to have at least 10 jobs. If a project has 50 investors, total jobs must be at least 500. The allocation is usually proportional to each investor’s level of investment.

For projects with a job creation buffer, the total jobs created exceed 10 per investor — usually 12–15 jobs per investor. This buffer protects investors against the risk of the project not achieving 100% of its job creation plan.

When assessing a project, investors should check:

• Total projected jobs / number of investors = how many jobs per investor
• What the buffer ratio is (ideally ≥1.2, or 12 jobs per investor)
• Whether jobs are allocated fairly between investors
• The mechanism if the project does not achieve 100% of its job target

Comparing EB-5 Direct and Regional Center on job counting

The choice betweenEB-5 Direct and a Regional Centerdirectly affects how the 10 jobs are counted. It is an important factor to weigh when choosing the investment structure.

Factor	EB-5 Direct	EB-5 qua Regional Center
Types of jobs counted	Direct jobs only	Direct, Indirect, Induced
Method of proof	W-2/1099 payroll, Form 941	Economist Report + project documents
Control	High — you manage the NCE yourself	Low — managed by the General Partner
Operational workload	Large — you must hire the full 10 employees yourself	Smaller — shared with many investors
Personal risk	High — dependent on the results of 1 business	Spread — a large-scale project
Capital requirement	$1,050,000 USD (outside a TEA) or $800,000 USD (TEA)	The same

EB-5 Direct suits investors with experience running a business in the United States who want direct control. The model requires actually hiring and keeping 10 full-time employees, which is no small challenge for a start-up business.

EB-5 through a Regional Center suits passive investors with no plans to run a business in the United States. The ability to count indirect and induced jobs makes it easier to meet the 10-job requirement, especially for large projects.

The risk of not creating the full 10 jobs

Failing to create the full 10 jobs during the 2-year conditional period is a serious risk that can lead to an I-829 denial and loss of the green card. Understanding the causes helps investors take preventive action.

Common causes of job shortfalls:

• The project is implemented more slowly than the original schedule
• The construction scale is reduced compared with the Business Plan
• A regional economic downturn affects hiring
• Changes in the operating model (automation replacing labour)
• Rising construction costs force a cut in project scope

USCIS allows some exceptions: if the project has not created enough jobs within 2 years but has a reasonable timeline to do so within “a reasonable time afterwards”, the I-829 may still be approved. USCIS usually interprets a “reasonable time” as no more than 1 year after the second anniversary of the conditional green card.

Ways to prevent the risk of a job shortfall include:

• Choosing a project with a high buffer (≥1.2, or 12 jobs per investor)
• Requesting regular reports on job creation progress
• Closely tracking the project’s hiring figures and intervening early if it falls behind
• Choosing a project whose Economist Report uses a conservative methodology

Conclusion

Creating 10 EB-5 jobs is not merely a legal requirement but the core of the EB-5 programme — reflecting its goal of boosting economic growth and employment in the United States. A clear understanding of the three types of jobs — direct, indirect and induced — and the corresponding counting methods helps investors correctly assess a project’s ability to meet the requirement.

For Vietnamese investors, the choice between EB-5 Direct and a Regional Center should be based on actual operating capability and risk tolerance. Whichever is chosen, thoroughly assessing the job creation plan in theBusiness Plan EB-5and the Economist Report is a step that must not be skipped before committing capital. Combining a project with a reasonable buffer with close monitoring of implementation progress is the key to success during the 2-year conditional period.

Indirect and induced jobs only count when investing through a regional centre — how to vet a regional centre is covered in the articleRegional Center EB-5.

Failing to reach the job milestone is one of the paths tothe risk of losing the green card at the I-829 stage.