The extension is available only to F-1 students with a degree in science, technology, engineering, or mathematics (STEM), who are employed by businesses enrolled in the E-Verify programme.

E-Verify is a free, Internet-based system operated in partnership with the Social Security Administration, which helps employers determine the employment eligibility of newly-hired employees.

"This rule will enable businesses to attract and retain highly skilled foreign workers, giving US companies a competitive advantage in the world economy," Homeland Security Secretary Michael Chertoff said.

"By extending the training period by an additional 17 months to students who are employed by businesses enrolled in E-Verify, we are further ensuring a legal workforce in the US and aiding good corporate citizens."

Prior to the extension, students graduating in spring could not apply for the H1-B visa, as applications were closed April 7. They do not have the facility of remaining in the US and applying next year either, because by then the OPT's 12-month deadline would have passed.

The 17-month extension allows US employers to hire spring graduates and keep them in America until their H-1B visas become effective. The new rule also automatically extends the period of stay and work authorisation for all F-1 students with pending H-1B petitions. The rule will also implement certain programme changes, including allowing students to apply for OPT within 60 days of graduation.