A new economic report released this week concludes that President Trump’s stated targets for strong U.S. economic growth in 2025 and beyond rest heavily on the labor of immigrants, including many he proposes to remove. The authors find that the scale of planned deportations—up to 1 million people each year for four years—would shrink the workforce, cut output, and push prices higher, making it far harder to reach growth goals. Multiple research teams cited in the report, including economists at the Economic Policy Institute, Dallas Fed, Baker Institute, Paris School of Economics, and the Wharton Budget Model, reach the same bottom line: large-scale deportations would directly weaken the very growth the administration promises.
Enforcement targets and scale
According to the report, the current Department of Homeland Security blueprint seeks to increase removals to as many as 1 million per year, about triple the recent annual level of roughly 330,000 removals nationwide. Congressional budget plans and DHS requests have been framed to support that higher throughput, the analysis says.
That acceleration would mark a sharp shift from recent enforcement volume and would touch every major part of the labor market, from construction sites and farms to hotels, restaurants, warehouses, and child care centers.
Critical: the plan’s proposed scale is not marginal — it reaches into prime-age workers who underpin many firms and sectors.
Projected labor-market and output effects
The study estimates that removing 4 million immigrants over four years would:
- Destroy about 5.9 million jobs
- ~3.3 million jobs held by immigrants
- ~2.6 million jobs held by U.S.-born workers who depend on immigrant coworkers, suppliers, and customers
The spillover arises from production slowdowns, lost demand, and tight links between frontline work and supporting roles. The hit would land hardest in industries with long-standing worker shortages, including:
- Construction
- Agriculture
- Hospitality
- Manufacturing
- Child care
Specific industry projections include:
- Construction employment: projected 18.8% drop
- Child care employment: projected 15.1% drop
When crews shrink, projects take longer, costs climb, and bottlenecks spread across supply chains.
GDP, prices, and macroeconomic impact
Economists running detailed models project a 2.6% to 6.2% drop in U.S. GDP over a decade if mass deportations proceed at the proposed pace.
For near-term context:
- Deporting 1.3 million people would lower GDP by 1.2% and employment by 1.1% by 2028.
Those numbers are large in macroeconomic terms. In a slow-growth environment shaped by aging demographics, even a 1% to 2% shift in output can separate a steady expansion from a stall.
Price pressures would likely rise, not fall. Removing millions of workers from sectors already facing shortages would force employers to bid up wages for hard-to-fill roles. Those higher labor costs would then be passed to consumers.
- Multiple models estimate a 1.5% to 9.1% increase in consumer prices by 2028 if the plan moves forward at full scale.
- The range reflects different assumptions on firm adjustments and the duration of supply disruptions.
Labor-force math and demographic context
The United States has long depended on immigrant labor to balance an aging workforce. Immigrants—especially those without status—are disproportionately in their prime working years (ages 25 to 54). Removing large numbers from that cohort magnifies effects on labor supply and output.
Evidence from past enforcement waves shows similar patterns: local economies lose both workers and spenders, which drags down hiring even for citizens. The report notes that past large-scale removals do not generate broad wage gains for U.S.-born workers. Instead:
- Businesses lose trained workers and may cut back, causing wages to slip and jobs to vanish for citizens.
- Employers often delay investment, scale back orders, or shift production, reducing demand in local economies.
- Peer-reviewed studies cited link mass removals to persistent negative effects on employment, earnings, and business formation.
How deportations weaken growth drivers
Growth depends on three drivers: more workers, more capital, and better productivity. A large-scale removal plan:
- Cuts the first pillar immediately (fewer workers).
- Strains the second and third pillars as firms delay expansion, divert funds to hiring/training, and face lower productivity in labor-intensive sectors.
- Raises the risk that promised growth targets will not be met.
Tax collections would also fall because immigrants contribute billions in federal, state, and local taxes via payroll, sales, and property taxes (directly or through rent). Fewer earners reduce these inflows, putting pressure on public budgets—especially at the state and local level.
For operational context on enforcement data and definitions, readers can review the Department of Homeland Security’s Yearbook of Immigration Statistics: https://www.dhs.gov/immigration-statistics/yearbook
Household and community impacts
Near-term consequences for households and communities include:
- Higher prices and longer wait times for goods and services.
- Delays in delivery schedules, slower new housing starts, and reduced availability of beds and services.
- Increased rent, food prices, and care costs as supply tightens.
- Loss of long-tenured staff with critical local knowledge and safety expertise.
- School and family disruptions where children lose a parent to removal.
Even if some jobs eventually attract new applicants, the transition is long and costly. Businesses lose output while they retrain or restructure.
Administrative and fiscal considerations
Expanding removals from roughly 330,000 per year to 1 million would require:
- More detention space
- More transport resources
- Expanded court processing capacity
- Additional personnel and sustained funding
These administrative costs are not fully captured in GDP models but matter for federal and local budgets.
Key takeaways and policy implications
Economists across the cited models agree on direction: fewer workers means slower growth. Over a decade, a 2.6% to 6.2% GDP reduction would compound and could erase the gains of several strong quarters.
The report’s central message: deportations at the proposed scale and the administration’s economic growth targets are incompatible.
Policy implications include:
- Growth plans and enforcement plans cannot be treated as separate tracks; immigration is now a core labor-market variable.
- If policymakers want faster growth, stable prices, and stronger public finances, cutting millions of workers out of the labor force points in the wrong direction.
- If large-scale deportations proceed, expect smaller payrolls, weaker GDP, and higher prices—outcomes that run counter to stated goals for broad-based prosperity.
The authors present a stark choice: align enforcement with labor-market realities, or accept that ambitious growth targets will be harder to achieve when the workforce itself is being reduced at historic scale.
This Article in a Nutshell
The report assesses the economic consequences of a proposed deportation program that could remove up to 1 million people annually, totaling 4 million over four years. Multiple institutions’ models show that large-scale removals would significantly reduce labor supply, causing about 5.9 million job losses through direct and spillover effects and hitting sectors with chronic shortages like construction, agriculture, hospitality, manufacturing, and child care. Analysts project a 2.6%–6.2% drop in GDP over a decade, near-term GDP and employment declines if 1.3 million are deported by 2028, and consumer-price increases between 1.5% and 9.1%. The study emphasizes that deportations would lower tax revenues, strain public budgets, raise costs for businesses, and slow investment. Policymakers face a choice: align enforcement with labor-market needs or accept weaker growth, smaller payrolls, and higher prices that contradict stated economic goals.
