Mass deportations are often framed as pro-worker policies. The argument is that if illegal immigrants are removed, wages for locals will increase through labor supply contracts. This logic is intuitive, politically powerful, but economically incomplete.
Mass deportations are massive market interventions. When examined through the lens of labor markets, production complementarities, and historical evidence, mass deportations emerge not as wage-raising reforms but as widespread negative shocks that reduce output, raise prices, and ultimately worsen the lives of most American workers.
The current proposal targets approximately 11 million illegal immigrants, of whom an estimated 8.5 million to 10.8 million participate in the labor force. This scale alone distinguishes this agenda from previous enforcement efforts. Economic models from the American Immigration Council and the Penn Wharton Budget Model estimate that laying off workers on this scale would shrink U.S. GDP by 2.6 to 6.8 percent, with losses equal to or greater than those of the Great Recession. These are not abstract macroeconomic forecasts. These reflect specific disruptions in an industry where unauthorized workers are deeply entrenched and difficult to fill.
From a first-principles perspective, forcing 8 to 10 million workers, mainly in their prime years, to be laid off is a negative labor supply shock. Labor time and productive capacity shrink, prices rise in sectors where labor cannot be readily replaced, and certain capitals and complementarities that make these workers particularly productive are destroyed. Because unauthorized workers are concentrated in industries that are labor-intensive and difficult to automate, lost production is not easily offset by capital deepening or local labor. Instead, the burden is divided between consumers who pay higher prices, complementary workers who earn lower real wages, and owners who absorb lower profits.
Construction and agriculture already epitomize these effects. Undocumented immigrants make up about 19% of workers in the construction industry and more than 30% in industries such as roofing, drywall and concrete, so a mass deportation would remove about 1.5 million workers, or about 14% of the sector’s workforce, from the job site, delaying projects and raising construction costs. In agriculture, unlicensed workers make up nearly a quarter of the nation’s farm workers and nearly a third of harvesting and sorting roles, so deporting them would mean the loss of 225,000 farm workers, lower production and higher food prices. One modeling exercise predicts food price inflation approaching 9% under a large-scale deportation scenario. Together, nearly 1 million workers could be lost in sectors such as hospitality, child care, cleaning services, and food preparation, where these jobs are physically demanding, irregular, and geographically fixed, and employers have historically struggled to replace immigrant workers with locals at wages acceptable to consumers.
History supports these predictions. As Secure Communities programs expanded between 2008 and 2013, many jurisdictions increased internal enforcement. Research at the time found that increased deportations led to a decline in construction activity and a 5 to 10 percent rise in house prices in affected areas, but wage increases for local workers were not sustained. Short-term labor shortages did not lead to sustained improvements in worker welfare. It led to decreased production and increased prices.
Proponents of mass deportations often acknowledge these disruptions, but argue that local workers will benefit from higher wages. In the short term, some lower-skilled native workers may experience modest wage increases, typically around 1 to 3 percent. However, these gains are small and temporary. Companies are responding to labor shortages not by raising wages indefinitely, but by shortening working hours, cutting production, automating, or shutting down altogether. As production contracts, the demand for labor decreases, eliminating the initial wage increase.
Meanwhile, high-skilled workers, who make up about two-thirds of the U.S. workforce, face clear losses. Because low-skill and high-skill workers are complementary in production, eliminating workers at the bottom of the skill distribution reduces the productivity of workers at the top. Penn Wharton’s budget model estimates long-term wage declines of 0.5% to 2.8% for high-skilled workers after mass deportations. These losses are diffuse and difficult to see. This makes them vulnerable to political neglect.
The financial impact adds to the damage. The Baker Institute estimates that the initial cost of mass deportations is more than $315 billion, with ongoing annual enforcement costs reaching $88 billion. Implementing such a policy would require a dramatic expansion of federal enforcement capacity, potentially adding hundreds of thousands of new employees. These expenditures would be covered by taxpayers, but would not result in a corresponding increase in production capacity.
At the same time, deportations result in substantial tax revenue losses. Illegal immigrants contribute about $46.8 billion annually in federal taxes, including payroll taxes that support Social Security and Medicare, and $29.3 billion annually in state and local taxes. Removing these contributors will exacerbate rather than alleviate long-term fiscal pressures.
The impact on society is equally important. More than 5 million U.S. citizen children live in households with at least one unauthorized parent. Deportation often cuts household income in half overnight, leaving families unstable and increasing their dependence on public assistance. Although these downstream costs rarely appear in enforcement-first rhetoric, they are real and enduring.
The political appeal of mass deportation lies in its visibility. Statistics on raids, removals, and crackdowns provide concrete signs of action. Economically, however, deportations function much like cartels, restricting the supply of labor to benefit a narrow group while imposing significant costs on consumers, taxpayers, and complementary workers. Property owners don’t have a monopoly on physically demanding jobs, and eliminating immigrants won’t magically reassign them to more productive natives.
Labor markets adjust through specialization and price signals. Immigrant workers tend to specialize in tasks that complement the native workforce, allowing companies to expand production and allowing natives to move into supervisory, technical, and customer-facing roles. Deportation disrupts this process and replaces cooperation and coordination with the military. We cannot simply redistribute jobs and wages more equitably, because this shrinks the economic pie.
If the goal is indeed higher wages and sustained prosperity, the more productive alternative is simple and supported by the most basic economic knowledge. Expand legal work visas, transparent pricing, and enforce contracts, not people. This means treating migrant workers like other market participants. Rather than relying on raids and deportations as the primary compliance tool, it provides businesses with legal and tradeable access to the workforce through visas, and then polices crack down on wage theft, recruitment fraud, and safety violations through contract and labor enforcement laws.
This need not override the concerns of those concerned about border security. For example, visa auctions could fund the resources needed for orderly borders while allowing labor markets to function. Employment verification occurs after employment and has the potential to protect property rights while deterring exploitation.
Mass deportations do not improve the status of American workers. It impoverishes them silently, extensively, and predictably. An economy based on voluntary exchange and secure property rights requires labor mobility, not forced scarcity. If the goal is wealth – more homes, lower prices, and higher real wages – then the evidence points decisively away from deportation and toward legal, market-driven flows of labor.
