A significant downturn in immigration to the United States, intensified by recent policies, is beginning to send ripples through various sectors of the economy, disrupting workplaces and communities nationwide.
This sharp fall in new arrivals threatens to slow economic growth, particularly in industries and cities that have increasingly relied on immigrant labor in recent years.
Bernard Yaros, an economist at Oxford Economics, notes that a sustained push against immigration will likely lead to a “slightly diminished” economy and “a touch higher” inflation.
The Numbers Behind the Decline
Data analysis from Oxford Economics reveals that net immigration—the difference between people entering and leaving the country—has plummeted.
- Net Immigration: It is currently running at an annualized rate of 600,000, representing a decrease of approximately one-third from the last three months of 2024.
- Reason: This decline is overwhelmingly due to a sharp drop in unauthorized immigration, with border crossings stalled and deportations on the rise.
- Result: Yaros estimates that in the long run, this trend could result in a 0.25% lower Gross Domestic Product (GDP).
Industries and Communities Feeling the Impact
The economic effects of reduced immigration are often a slow burn. However, the immediate consequences are already being felt in industries heavily dependent on immigrant workers, such as agriculture, hospitality, construction, and meatpacking.
Smaller cities that had experienced economic boosts from immigration are particularly vulnerable to the effects of increased deportations and Immigration and Customs Enforcement (ICE) raids. Cities like St. Louis, Buffalo, and Pittsburgh have seen restaurant tables empty, kitchen workers stay home, and local businesses struggle as the number of shoppers dwindles.
The nation’s farms are facing severe challenges, with employees fearful of reporting to work. This has led to reports of crops rotting in fields and fruits and vegetables unpicked during peak harvest times. ICE operations are also impacting carwashes, construction sites, and meatpacking plants across the country.
In Los Angeles, immigration raids are reportedly slowing down crucial rebuilding efforts following devastating fires earlier this year. Even the horse racing industry in Louisville has expressed concerns, with trainers describing the current climate as “scary times.”