Introduction
Mass deportation is often sold as an economic cure-all—freeing jobs, lifting wages, and reducing fiscal burdens. The evidence assembled in this report points in the opposite direction. We first frame deportation as a large negative labor shock, showing how it reduces output, disrupts capital investment, and depresses wages even for native‑born workers. We then examine national forecasts of GDP, employment, and public revenues, documenting trillions in lost output and weakened Social Security and Medicare finances. Finally, we trace sector‑ and place‑specific impacts, detailing how construction, agriculture, hospitality, and local tax bases would be hit hardest.
Mass deportation of unauthorized immigrants functions in the research literature as a large, negative labor shock rather than a jobs “liberation” policy. Unauthorized workers are disproportionately clustered in key sectors—agriculture, construction, hospitality, and certain manufacturing niches—where they operate as essential complements to U.S.-born and higher‑skill workers. Their sudden removal shrinks the effective labor force, disrupts production technologies built around abundant low‑skill labor, and forces firms to contract capital and output rather than seamlessly substituting native workers into vacated roles [1][2][3][4][5][6][7].
Across macroeconomic models and empirical studies, projected GDP losses from mass deportation are large and persistent. National estimates converge on long‑run GDP declines of roughly 2.6–6.2%, with some scenarios extending into the 6.8–7.4% range depending on deportation scale and assumptions [1][2][3][4][5]. At current income levels, this implies output losses on the order of $711 billion to $1.7 trillion annually [1][3]. One 10‑year scenario finds GDP falling by 1.4% in the short run and 2.6% in the long run, cumulatively erasing about $4.7–$5 trillion in output between 2017 and 2026 and raising federal deficits by roughly $1 trillion as tax receipts fall faster than spending can adjust [2][3]. These projected contractions rival or exceed the Great Recession in terms of the share of output lost, but originate from labor‑market disruption rather than financial collapse.
Sectoral evidence explains why these aggregate losses are so large. Immigrant‑intensive industries act as “linchpins” in the production network, amplifying the initial labor shock:
- Construction: Unauthorized workers make up roughly 14–15% of the construction workforce, and over 30% in some specialized trades such as roofing, drywall, concrete, plastering, painting, and similar finishing and structural work [1][3]. Removing about 1.5 million such workers would slow or halt projects, raise construction and renovation costs, and tighten housing supply, with downstream effects on rents and home prices. Because construction is capital‑intensive and project‑based, labor shortages do not simply raise wages; they reduce the number of viable projects and shrink overall employment for complementary occupations such as supervisors, engineers, architects, and suppliers.
- Agriculture: Unauthorized workers constitute roughly 22–25% of farm labor overall and close to one third of graders and sorters, and an even higher share in labor‑intensive harvesting [1][2][3]. Deporting an estimated 225,000 farm workers leads to reduced crop output, particularly for fruits, vegetables, and other hand‑picked commodities, and pushes food prices higher. With limited short‑run capacity to mechanize or substitute domestic labor at scale, output losses materialize quickly, while costlier food and supply chain disruptions spill over into related industries such as food processing and retail.
- Hospitality and services: Undocumented workers account for about one in 14 workers across hospitality, with roughly one quarter of all housekeeping cleaners in hotels and related services [1][3]. Their removal raises operating costs, compresses profit margins, and, in many localities, leads to reduced service offerings, closures, or diminished tourism capacity. Because these sectors anchor local consumer economies, contraction here feeds back into restaurants, retail, and transportation.
- Manufacturing and other immigrant‑intensive sectors: Unauthorized immigrants make up meaningful shares of the workforce in certain manufacturing segments (around 8%) and other low‑wage service industries [1][3][6][7]. The resulting production bottlenecks force firms either to automate more rapidly—often at the cost of net employment—or to relocate or downsize, reducing local economic activity.
The distribution of these workers across sectors means that mass deportation does not simply “reallocate” jobs to U.S.-born workers; it breaks production chains. Labor markets in these industries already exhibit tight conditions, with employers struggling to fill physically demanding, lower‑paying, or geographically concentrated roles. When millions of such workers are removed, firms often respond by cutting output, investment, and related jobs rather than raising wages enough to attract domestic workers at scale.
Empirical evidence from historical enforcement actions underscores this point. Analyses of interior enforcement and deportations between 2008 and 2015, which removed roughly 454,000 unauthorized workers, find that the share of U.S.-born workers in employment actually fell by about 0.5%, and their hourly wages declined by about 0.6% [1][3]. Rather than boosting opportunities for citizens, the localized labor shock reduced production and overall labor demand. A historical study of the 1929–1937 Mexican deportations similarly finds reduced employment and higher unemployment for U.S.-born workers, with neutral to negative wage impacts [1]. These patterns mirror contemporary macro simulations suggesting that for every 500,000 unauthorized immigrants removed from the labor force, around 44,000 U.S.-born workers lose their jobs as firms scale back [3][4][5]. Under large‑scale scenarios, aggregate employment losses can reach up to 3.6–7% of the workforce, as the economy re-equilibrates at a smaller scale [1][3][4][5].
These labor‑market outcomes reflect the complementary roles unauthorized workers play. Many are in low‑wage, labor‑intensive jobs whose availability increases the productivity and employment of higher‑skill or native workers—such as supervisors, managers, logistics personnel, and professionals whose output depends on a sufficiently large team. When the base of this labor pyramid is removed, the marginal productivity of remaining workers declines. Macroeconomic models that allow for capital adjustment, substitution, and automation consistently find that the removal of millions of unauthorized workers reduces not just low‑skill employment but also jobs and wages for many higher‑skill workers, as capital stocks are written down and firms forego expansion [2][3][5][7].
Price dynamics reinforce these real‑output and employment effects. With fewer workers in agriculture, construction, and services, production constraints translate into higher prices, especially where demand is inelastic and substitution is difficult. Simulations estimate that broad price levels could be up to 9.1% higher within a few years under aggressive deportation policies, driven by more expensive food, housing, and key services [3][4][5]. These inflationary pressures erode real incomes for remaining workers, particularly lower‑ and middle‑income households that spend larger shares of their budgets on food, rent, and local services. In this sense, mass deportation acts as a stagflationary shock: it both reduces real output and raises prices across a wide range of basic goods.
Public finances are also adversely affected. Unauthorized immigrants and their households currently contribute tens of billions of dollars annually in federal, state, and local taxes, including payroll contributions to Social Security and Medicare that they are often ineligible to fully claim [1][3][4]. One set of estimates indicates that deportation of the current unauthorized workforce would eliminate about $46.8 billion in federal tax payments and $29.3 billion in state and local taxes in a single year, as well as $22.6 billion in Social Security contributions and $5.7–$6 billion for Medicare [1][3][4]. Over a decade, macro‑budget models project cumulative federal revenue losses large enough to increase deficits by roughly $1 trillion, compounding the GDP shock [2][3][4]. These losses come on top of substantial implementation costs for enforcement, detention, legal proceedings, and transportation, which further strain budgets without offsetting revenue gains from higher native employment.
Demographic projections add another layer of long‑run cost. Unauthorized immigrants tend to be younger and in their prime working and child‑rearing years. Removing them and preventing the future arrival of similar workers accelerates population aging and raises old‑age dependency ratios. A detailed 10‑year deportation scenario projects roughly 5 million fewer people in the United States by 2028 and nearly 18.8 million fewer by 2054, with about two‑thirds of the reduction attributable to the absence of unauthorized immigrants and their descendants [4]. This demographic shift shrinks the base of contributors supporting Social Security and Medicare relative to retirees, undermining the solvency of these programs and forcing either benefit cuts, higher taxes on remaining workers, or larger deficits. Far from easing fiscal burdens, mass deportation deepens them by weakening the very demographic and tax base that sustains public programs.
Local and regional analyses show how these national dynamics play out on the ground. In immigrant‑dense states and metro areas—such as California and major urban centers—unauthorized workers are woven into construction booms, agricultural valleys, hospitality corridors, and care‑adjacent services [1][3]. Removing large shares of the labor force in these hubs leads to project cancellations, farm closures or scaled‑back planting, and reduced tourism and local consumption. Downstream businesses—suppliers, transporters, retailers—confront lower sales and uncertain input availability. The combined effect is a contraction of local GDP, falling property and sales tax revenues, and budget shortfalls for schools, infrastructure, and public safety.
Summarizing across this literature, mass deportation does not function as a Pareto‑improving labor market adjustment. Instead, it contracts the size of the economy, reduces employment for both immigrants and U.S.-born workers, raises consumer prices, erodes public revenues at all levels of government, and intensifies demographic pressures on social insurance systems. The central mechanism is not simple worker substitution but the disruption of complementary roles that unauthorized immigrants play within production networks and regional economies; removing them leaves a smaller, less productive, and more fiscally strained economic system [1][2][3][4][5][6][7].
Conclusion
Across macro models, historical case studies, and sector‑level analyses, the evidence converges: mass deportation functions as a large, negative labor shock that leaves the U.S. smaller, poorer, and less resilient. Removing millions of unauthorized workers reduces GDP, shrinks total employment—including for U.S.-born workers—weakens productivity, and raises prices, especially in immigrant‑reliant sectors such as agriculture, construction, and hospitality. Local tax bases and federal revenues deteriorate even as demographic aging accelerates, worsening fiscal pressures on Social Security and Medicare. Rather than freeing up jobs or saving public funds, mass deportation undermines growth, public finances, and economic opportunity for the very citizens it claims to help.
Sources
[1] “The potential economic consequences of mass deportation policies on the U.S. economy,” Journal of Undergraduate Conference in Economics, University of Northern Iowa. https://scholarworks.uni.edu/cgi/viewcontent.cgi?article=1023&context=jucie
[2] “The Economic Impacts of Removing Unauthorized Immigrant Workers,” Center for American Progress (2016). https://www.americanprogress.org/wp-content/uploads/sites/2/2016/10/massdeport1003.pdf
[3] “Economic Impact of Mass Deportation: A Review of the Research,” Carsey School of Public Policy (2024). https://carsey.unh.edu/sites/default/files/media/2024-08/economic-impact-mass-deportation-lit-review.pdf
[4] “Mass Deportations Would Deliver a Catastrophic Blow to the U.S. Economy,” U.S. Joint Economic Committee Democrats (2024). https://www.jec.senate.gov/public/index.cfm/democrats/2024/12/mass-deportations-would-deliver-a-catastrophic-blow-to-the-u-s-economy
[5] Tarnell Brown, “The Deportation Labor Shock,” EconLog (2026). https://www.econlib.org/econlog/the-deportation-labor-shock
[6] “Illegal immigration to the United States,” Wikipedia. https://en.wikipedia.org/wiki/Illegal_immigration_to_the_United_States
[7] “Economic effects of immigration,” Wikipedia. https://en.wikipedia.org/wiki/Economic_effects_of_immigratio
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