The United States experienced a cooling of inflation in 2024, providing some respite to consumers and businesses alike. However, this economic stability may be threatened by President-elect Donald Trump's proposed plan for the mass deportation of undocumented immigrants. Economists warn that this initiative could profoundly impact prices and the broader economy.
Chloe East, a research associate at the National Bureau of Economic Research, played a pivotal role in a 2023 study published in the Journal of Labor Economics. The study revealed that for every 500,000 immigrants removed from the labor force, approximately 44,000 U.S.-born workers could face job losses. East emphasized uncertainty surrounding the exact consequences of mass deportation.
"We can't say for sure what the effects will be," – Chloe East
The study further suggested that mass deportation could significantly affect sectors where undocumented immigrants are predominantly employed, such as construction and agriculture.
"But based on what we know from past mass deportation efforts, it seems like goods and services where unauthorized immigrants are super concentrated like construction and agriculture, the prices are likely going to go up as a result of a mass deportation effort rather than down." – Chloe East
David J. Bier, director of immigration studies at the Cato Institute, concurs with these assessments. He highlighted the inevitability of economic impacts stemming from such a large-scale deportation initiative.
"Certainly the economic impacts are going to be felt," – David J. Bier
The findings from the 2023 study underscore potential challenges for the U.S. economy. As President-elect Trump prepares to implement his immigration policies, these economic implications warrant closer scrutiny. The removal of 500,000 immigrants could lead to significant disruptions in labor markets and price fluctuations across various sectors.