Trump immigration crackdown ripples through economy

Data: Oxford Economics/Cato Institute/Deportation Data Project/CBO/DHS/TRAC. Chart: Axios VisualsPresident Trump's immigration crackdown is hitting key pockets of the economy, disrupting workplaces and communities around the country.Why it matters: The sharp fall in immigration this year threatens to slow down economic growth, particularly in the sectors and cities that relied on newcomers to the U.S. in recent years.What they're saying: With the push against immigration, "the economy will find itself slightly diminished in the long run and inflation will run a touch higher," economist Bernard Yaros writes in a report for Oxford Economics.There will be fewer workers to produce goods and services, slowing down growth and putting pressure on wages.By the numbers: Net immigration started to fall last summer after the Biden administration took a harder line. This year, Trump's crackdown has been far more aggressive.Net immigration — inflows of people minus outflows — is running at an annualized rate of 600,000, down about a third from where it was in the last three months of 2024, per the analysis by Oxford Economics, which looks at several sources of public data.The decline is almost entirely due to a sharp drop in unauthorized immigration. Border crossings are stalled, and deportations are up.What to watch: Yaros estimates in the long run, GDP will be 0.25% lower as a result.That's a relatively modest macroeconomic effect, but there's a wild card. The "big, beautiful bill" that passed the Senate contains about $175 billion for even more immigration enforcement.That could mean an even bigger decline going forward.Between the lines: Immigration's effects on the economy are a slow burn, and it'll take a while before it shows up in the macro data.For now they are rippling through industries that rely on immigrant workers, like farms, hotels, construction and meatpacking plants.Zoom in: Smaller cities are feeling the hit from deportations and ICE raids, places like St. Louis, Buffalo and Pittsburgh where immigration had boosted faltering economies, the Wall Street Journal reports."The arrests cast a shadow over the local economy. Restaurant tables emptied. Kitchen workers stayed home. Fruit vendors disappeared from the streets. The number of shoppers at stores shrank, and those who still went didn't linger for long," the paper writes.The nation's farms are in a tough spot, too, and employees are fearful of showing up to work."That means crops are not being picked and fruit and vegetables are rotting at peak harvest time," farmers and farmworkers told Reuters.ICE is also going through carwashes, construction sites and meatpacking plants, the Washington Post reports.In Los Angeles, immigration raids are slowing down the rebuilding efforts from the devastating fires earlier this year, the Los Angeles Times reports.Even the horse racing industry is sweating the crackdown. "Scary times," a Louisville racehorse trainer tells a local news station about ICE raids.Yes, but: Immigration opponents say the crackdown will translate into more and better-paying jobs for native-born Americans.The bottom line: Until recently, a surge in immigration drove solid economic growth and a robust labor market. Now, policy is pushing it the other way.

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