(FORTUNE Magazine) – In a development that is causing panic from New York City's fashion runways to the fluorescent cubicles of Silicon Valley, the U.S. government is about to halt the flow of foreign talent into American workplaces. Barring a move by Congress, it seems that American employers will use up the 1998 quota of H-1B temporary work visas for professionals as early as mid-May. Companies looking to import talent after that will have to wait until the next federal fiscal year begins on Oct. 1.

"This is very, very serious," says 3Com founder and CEO Eric Benhamou, who, though now a citizen, entered the U.S. from France on an earlier version of the H-1B. Indeed, the impending visa freeze threatens whole swaths of the economy, from fashion (about half of all Ford Agency models are foreigners, for example), to health care (hospitals import as many as 13,000 physical therapists a year).

No sector is more at risk, however, than the all-important infotech industry--which was, after all, built by immigrant engineers such as Intel's Andy Grove (Hungary), Sun Microsystems' co-founder Anant Agrawal (India), and Benhamou. Silicon Valley is dependent on foreign talent because American universities have been pumping out only about 40,000 electrical engineers and computer scientists a year, while industry demand is twice that and rising. Even a pause in the current influx of about 3,000 engineers and scientists a month will mean "lost business opportunities, slower innovation, and diminished productivity," warns Sun CEO Scott McNealy.

If the stakes weren't so high, the predicament might be almost laughable. After all, Congress has defined a professional as--get this--either someone in a job that requires a bachelor's degree, or a fashion model. That means for every new Kate Moss wannabe who jets over, one fewer computer programmer gets in. So give us your tired, your hungry, your huddled teenage clotheshounds--but keep the engineers coming too.

--Kim Clark