Washington, D.C.: President-elect Donald Trump’s proposed mass deportation plan and other immigration policies may pose significant challenges to U.S. economic growth, according to analysts. The policies, which target the estimated 11 million unauthorized immigrants in the country, could have far-reaching effects on industries such as agriculture, construction, and hospitality that heavily rely on undocumented labor.

Impact on Key Industries
A report by the American Immigration Council (AIC) highlights the potential fallout of the deportation plan. In construction and agriculture, at least one in eight workers could be lost, while the hospitality sector could see the removal of one in 14 workers. More than 30% of plasterers, roofers, and painters, as well as a quarter of housekeeping cleaners, could face deportation.

These industries, already struggling to attract U.S. workers, would face further labor shortages. This challenge underscores the complexity of Trump’s assertion that “Americans are being squeezed out of the labor force and their jobs are taken,” as many of these sectors have traditionally depended on immigrant labor.

Economic Growth at Risk
A joint study by the American Enterprise Institute (AEI), Brookings Institution, and the Niskanen Center projects that Trump’s immigration policies could reduce GDP growth in 2025 by 0.4 percentage points. The decline would stem primarily from a reduced workforce and diminished consumer spending by deported individuals and their families.

Under a projection involving 3.2 million deportations during Trump’s term, net migration is expected to drop sharply, from 3.3 million in 2024 to negative 740,000 in 2025. In an extreme scenario, which analysts deem unlikely, the expulsion of all 8.3 million undocumented workers could shrink economic growth by 7.4% by 2028, effectively eliminating net growth during a second Trump term.

The Peterson Institute for International Economics also forecasts inflationary pressures, predicting a 3.5-percentage-point increase in inflation by 2026 as wages rise to attract domestic workers in affected industries.

Legal and Logistical Hurdles
Experts argue that legal, logistical, and financial challenges are likely to limit the implementation of the most extreme deportation proposals. Analysts at Goldman Sachs anticipate that net migration will ease modestly next year to 750,000 annually, below the pre-pandemic average of one million.

Ryan Sweet, chief U.S. economist at Oxford Economics, expressed skepticism about the feasibility of mass deportations, stating that practical obstacles will temper the impact of such policies.

Sector-Specific Price Increases
Economists warn that sectors like agriculture and construction could experience significant price hikes, while broader inflationary impacts may remain modest. Michael Strain of AEI noted that rising wages in these industries could lead to higher costs for consumers. However, weaker overall demand and slower inflation in other areas, such as housing, might offset some of the pressure.

Policy Repercussions
The debate over Trump’s immigration policies highlights the tension between political goals and economic realities. While the proposed measures aim to address illegal immigration, their potential economic fallout could create challenges for both the U.S. economy and industries dependent on immigrant labor. As implementation hurdles emerge, the extent of their impact remains uncertain.