President-elect Donald Trump is vowing to carry out the largest deportation program in American history.
While the scale and scope of any expulsion program remain in question given the costs and legal challenges associated with carrying out such an operation, economists argue any forced removals would have ripple effects across major sectors — particularly agriculture, construction, and hospitality — and strain the already tight US labor market .
“The reason that it's disruptive is not simply because our economy relies on this labor; it's the abruptness of it,” said Wendy Edelberg, a director at the Hamilton Project.
The Department of Homeland Security estimates more than 11 million undocumented immigrants currently live in the US. Nearly 90% of that population is of working age, according to the American Immigration Council (AIC).
That number has ticked higher in recent years . In 2023 alone, the US experienced a net migration of 3.3 million, the Congressional Budget Office (CBO) estimated.
Edelberg said that surge coincided directly with a period of strong job creation, with higher immigration boosting employment growth by 60,000 jobs per month in 2022 and 100,000 jobs monthly in 2023. That helped ease tightness in the labor market, reducing wage pressures that drove the prices of goods and services.
“If [Trump’s plan] really comes to pass, take whatever [jobs] number you had in mind and subtract 100,000 a month,” Edelberg said. “Basically you’re just reversing.”
Sectors feeling the biggest pinch
The construction industry is likely to take the biggest hit, with undocumented workers accounting for nearly 14% of its workforce, though that share is significantly higher in states like Texas and California.
Jim Tobin, president and CEO of the National Association of Home Builders (NAHB), said any widescale crackdown is likely to have a chilling effect on construction activity, reducing the labor pool and driving labor costs higher, despite Trump’s claim that the immigrants themselves are driving housing prices higher.
If the past is any indication, that could contribute to a reduction in housing supply . Researchers at the University of Utah and the University of Wisconsin found that an Obama-era immigration program, Secure Communities, led to more than 400,000 deportations between 2008 and 2013. Three years after the program began, US counties that implemented the program saw more than 2,400 fewer building permits and 2,000 fewer new homes on average, a cumulative loss of roughly a year’s worth of residential construction.
The agriculture sector is also bracing for major disruptions. Roughly 13% of the sector's workforce is made up of undocumented workers, according to the AIC, and that number is even higher for crop farmworkers, at 30%.
Nisei Farmers League president Manuel Cunha said any crackdown on that workforce is likely to lead to disruptions in food supply for the country, according to data from the US Department of Agriculture (USDA). The largest share of those workers is in California, where Cunha represents more than 500 farmers in the Central Valley.
“There ain't going to be any food in the stores because the people that are here [legally] are not going to work in our industries,” Cunha said. “[Workers] put their lives on the line to feed the United States ... these are not criminals. These are real, true people in the community that have raised a family.”
'We need workers'
As Trump gets ready to begin his second term, undocumented workers and their families are bracing for more uncertainty around their legal status.
During Donald Trump’s first administration, Alejandro Flores-Muñoz, a recipient of Deferred Action for Childhood Arrivals (DACA), pivoted to entrepreneurship out of necessity. Flores-Muñoz started his food truck business Combi Cafe in 2018, fearful that a crackdown on immigration would leave him without a viable job.
“When [Trump] started challenging the validity of DACA, and when courts started to actually put a hold on new applicants, that's when I was like, 'OK, I need to really start looking into how can I self-sustain myself if I was to lose my work authorization,'” Flores-Muñoz said.
The exact reduction in the labor force is hard to quantify, in part because Trump has not detailed how he plans to carry out his deportation plan.
Thomas Homan, the newly nominated “border czar,” has called for the immediate removal of undocumented criminals , vowing to take a “targeted” approach that first prioritizes migrants already detained by local law enforcement and immigrants who are considered national security threats.
But Edelberg expects the administration’s actions to expand beyond that to include the elimination of other visa programs, including Temporary Protected Status. That would amount to the removal of 750,000 workers in the first year of Trump’s term, she said.
The Peterson Institute for International Economics estimated that even a fraction of the deportations touted by Trump would push prices higher. In its baseline case of 1.3 million migrants being removed, prices would rise by 1.5%. That number would jump to 9.1% by 2028, in a maximum case of 8.3 million immigrants being deported.
But the impact is expected to spread beyond that, with fewer taxpayers leading to reduced revenue. The AIC estimates deporting all undocumented immigrants would result in a loss of nearly $45 billion in federal taxes.
“[Immigrants] have been weaving the fabric of this nation ... for a long period of time,” said Ada Briceño, co-president of the Unite Here Local 11 union, which represents more than 32,000 workers in the hospitality sector in Arizona and California. “We need workers. We need workers to get the job done.”
@AkikoFujita .
