President-Elect Trump’s Deportation Program and Its Impact on the US Labor Market

President-Elect Trump’s Deportation Program and Its Impact on the US Labor Market

President-elect Donald Trump has pledged to implement the largest deportation program in American history. While the scale and details of the program remain uncertain, economists have warned of its potential consequences, particularly on major sectors such as agriculture, construction, and hospitality.

Economic Disruptions and Labor Market Strain

The sudden removal of a significant number of undocumented workers would have ripple effects across the economy, disrupting key industries and exacerbating the already tight labor market. Economists argue that the abrupt nature of the removals would add to the disruption, as businesses would have to quickly adjust to the loss of workers.

Agriculture Sector Braces for Major Disruptions

The agriculture sector is particularly vulnerable, with roughly 13% of its workforce comprised of undocumented workers, a figure that rises to 30% among crop farmworkers. Manuel Cunha, president of the Nisei Farmers League, warns of potential disruptions in the food supply chain, especially in California, where the majority of these workers are located.

Construction Industry Faces Labor Shortage and Higher Costs

The construction industry, with its 14% undocumented workforce, faces a similar predicament. Jim Tobin, president and CEO of the National Association of Home Builders, anticipates a chilling effect on construction activity, citing the reduced labor pool and inevitable increase in labor costs.

Hospitality Sector Grapples with Worker Shortages

The hospitality sector, represented by Ada Briceño, co-president of the Unite Here Local 11 union, also faces challenges in filling job openings. Briceño emphasizes the need for workers to maintain the industry’s productivity and efficiency.

Labor Force Reduction and Economic Consequences

The precise reduction in the labor force is difficult to quantify, given the lack of details on the deportation plan. However, economists believe that the administration’s actions could extend beyond criminal deportations to include the elimination of visa programs like Temporary Protected Status, potentially removing an additional 750,000 workers within Trump’s first year.

Price Increases and Reduced Tax Revenue

The Peterson Institute for International Economics estimates that even partial deportations could lead to higher prices, ranging from 1.5% to 9.1% by 2028. Moreover, the loss of taxpayers through deportations would result in reduced federal tax revenue, amounting to nearly $45 billion, according to the American Immigration Council.

Undocumented Workers and Their Families Face Uncertainty

Undocumented workers and their families are facing heightened uncertainty around their legal status. Alejandro Flores-Muñoz, a DACA recipient, started a food truck business out of necessity, fearing the consequences of an immigration crackdown on his ability to work.

President-elect Trump’s deportation program has generated concerns among economists and industry leaders over its potential impact on the labor market, with disruptions expected in key sectors like agriculture, construction, and hospitality. The abrupt removal of undocumented workers would exacerbate the existing labor shortage, pushing up prices and reducing tax revenue.