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Growing Consensus: Trump Immigration Agenda Will Devastate U.S. Economy

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Washington, DC — A New York Times story by Lydia DePillis, “Why Trump Allies Say Immigration Hurts American Workers,” examines the “new right” skepticism to immigration and the relationship between immigration and native-born American workers, marshaling evidence that shows why the vast majority of economists disagree with Donald Trump, J.D. Vance and their fellow restrictionists. From mass deportation to slashing legal immigration, the incoming administration is proposing economic turmoil if and when it follows through with its anti-immigrant plans.

The New York Times story is just one of several important pieces that show how the fundamental understanding of the economics of immigration has evolved beyond simplistic supply/demand dynamics we may have learned in introductory economics courses in college – the same simplistic understanding that guides Trump, Vance and their team. Our current and more accurate understanding of immigrants as multifaceted economic inputs – workers, consumers, taxpayers, employers and innovators – makes clear that the Trump anti-immigrant crackdown will harm the U.S. economy – from our food supply to scientific research to the tech industry to overall economic growth. 

According to Douglas Rivlin, Senior Communication Director for America’s Voice:

“Donald Trump’s signature policy agenda of mass deportation and slashing legal immigration levels will hit American industries and consumers hard. They just have the economics backwards. The deportation of millions of workers and roadblocks for legal immigration will make it harder for both cancer researchers and agricultural workers to come to or stay in the United States. We may be forced to forgo their labor, their tax revenues, their demand for goods and services, their entrepreneurialism and their job creation. The opposition to immigration and desire to deport millions of people who live and work here, if followed through, will harm every American, including millions of Trump voters, spiking inflation, driving up deficits, cutting tax revenues and shrinking GDP and employment alike. It will wreak havoc on specific industries, but the ripple effects will be felt in every corner of the American economy.” 

Find key excerpts from the Lydia DePillis New York Times story below, followed by a collection of other recent commentary and coverage highlighting different components of the economic harms posed by the upcoming immigration agenda – as well as a link to Wednesday’s webinar on the economics of mass deportation and restrictionist policies:

“[T]here is an intellectual movement behind immigration restriction that seeks to reshape the relationship between employers and their sources of labor … It seems like a simple equation: When fewer workers are available, employers have to try harder to compete for them. Certainly that dynamic played a role in the swift wage growth early in the pandemic, when people willing to do in-person jobs — waiters or nurses, for example — were in especially short supply. 

…A few factors started to change the political dynamics. First, the research was evolving. New forms of empirical data analysis started to show that the Economics 101 version of immigration — more workers means lower wages — didn’t always hold true.

A recent synthesis of dozens of studies found that immigration had only a very slight negative impact on the wages of less-educated native-born workers. A comprehensive overview by the National Academies of Sciences, Engineering and Medicine found modest negative effects only for some earlier immigrants and for teenagers. A paper published this spring, whose authors included Giovanni Peri, an economist at the University of California, Davis, found that immigration had a positive impact on U.S. workers.

Why could that be? Immigrants don’t just add labor to an economy; they also add demand for goods and services, which creates jobs for other people. Also, those coming illegally tend to have low levels of education. The jobs they do, like working in meatpacking plants, allow more native-born workers to move into positions as supervisors, salespeople and accountants.”

Wall Street Journal article by Patrick Thomas, “Farms, Meat Plants Brace for Trump Immigration Crackdown,” noting:

“America’s food-supply chain relies on a predominantly immigrant workforce for some of its most challenging jobs, such as picking fruit, applying pesticides on crops, operating machinery and slaughtering livestock. About two-thirds of U.S. crop-farm workers are foreign-born, and 42% aren’t legally authorized to work in the country, according to a Labor Department report 

… At one of the country’s largest beef plants in Colorado, local union leader Kim Cordova said some workers legally authorized to work in the U.S. have started asking if they should quit their jobs and flee to Canada. As a result, she said the union is planning more “know your rights” meetings and helping workers come up with plans in case they get separated from their families. “We don’t have an undocumented problem at our facility, but workers are fearful of raids,” she said, adding that, without those workers, meat plants would have a hard time keeping up production. “It will kill this industry.””

NPR article by Jon Hamilton, “Foreign nationals propel U.S. science. Visa limits under Trump could change that,” noting:

“Foreign-born workers account for about half of the doctoral-level scientists and engineers working in the U.S. … But the incoming Trump administration has signaled that it will crack down on H-1B visas, which could make it harder for universities, research institutions, and tech firms in the U.S. to find enough highly educated workers.”

Axios article by April Rubin, “The industries that could be hardest hit by Trump’s immigration crackdown,” noting:

“President-elect Trump’s vow to deport millions of undocumented immigrants could eliminate workers from U.S. industries already projected to face shortages and cut up to 6.8% of the national gross domestic product … While undocumented laborers make up a relatively small percentage of the total U.S. workforce, they have outsized roles in fields like construction, agriculture and hospitality.”

Nobel economics winner and New York Times columnist Paul Krugman’s latest, “How Hostility to Immigrants Will Hurt America’s Tech Sector,” noting: 

“Mass deportations would create shortages and raise prices in industries that employ large numbers of undocumented immigrants … Beyond these near-term effects, however, there’s a likely consequence of Trumpism that hasn’t received a lot of attention: the threat that it will pose to American technological leadership 

… What’s driving that success story? No doubt it has multiple causes, not least the network externalities created by the technology cluster in Silicon Valley, which has incredibly high per capita income. But spend time in America’s tech hubs, and it becomes obvious that immigrants — often highly educated immigrants from South Asia and East Asia — are also a key part of the story … The first Trump administration was clearly hostile to legal, highly educated immigrants as well as undocumented blue-collar workers. It made getting or renewing visas significantly harder for high-skilled foreigners, which is the main way they can work here. And many of these workers fear that these policies will return, only worse 

… I’ll be very surprised if the turn against immigrants spares highly educated workers. Specific policies aside, one reason America has been so successful at attracting the world’s best and brightest is the openness of our society; more, perhaps, than any other nation, we have been a place where people from different cultures can feel welcome. That era may come to an end.”

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