U.S. Economy Faces Trillion-Dollar Hit and Widespread Disruptions from Mass Deportation of Undocumented Workers

The U.S. economy could face a staggering $1.1 to $1.7 trillion reduction in annual Gross Domestic Product (GDP) and severe labor shortages across critical sectors if all undocumented farm and hotel workers were to be deported. This potential economic fallout, highlighted in a recent tweet by Bill Mitchell, underscores the deep integration of this workforce into the nation's agricultural and hospitality industries. Mitchell posed a "serious question" on social media, stating, "Let's say we deport all illegal farm and hotel workers tomorrow. It takes time, money and training to replace these, like 90 days minimum. Do you want farms and hotels to shut down for 90 days? Is that your plan?"

Undocumented immigrants constitute a vital segment of the American workforce, particularly in physically demanding and often low-wage roles that many U.S.-born workers are unwilling to fill. In the agricultural sector, approximately 40% to 50% of farm laborers are undocumented, playing an indispensable role in harvesting crops and maintaining the food supply chain. Their removal would lead to significant agricultural output declines, estimated to be between $30 billion and $60 billion, and subsequently higher food prices for consumers.

Similarly, the hospitality industry, encompassing hotels, restaurants, and other leisure services, heavily relies on this labor pool. Undocumented workers account for an estimated 7% to 10% of the leisure and hospitality workforce, performing essential tasks such as housekeeping, food preparation, and maintenance. The sector already struggles with chronic labor shortages, with many hotels reporting difficulties in filling vacancies despite active recruitment efforts. Industry executives and associations, including the American Hotel and Lodging Association, have consistently lobbied for expanded legal immigration pathways to address these persistent workforce gaps.

Beyond the immediate impact on these specific industries, a mass deportation policy would trigger broader economic repercussions. Analyses from various research institutions, including the American Immigration Council and the Center for American Progress, project that such an action would lead to a substantial loss in federal, state, and local tax revenues, potentially totaling tens of billions of dollars annually. Furthermore, the removal of millions of working-age individuals would reduce consumer spending power by hundreds of billions, affecting businesses nationwide and potentially causing job losses for U.S.-born workers in complementary roles. The direct cost of apprehending, detaining, and deporting such a large population is also estimated to be in the hundreds of billions of dollars, further burdening taxpayers.

Economists warn that the idea of quickly replacing these workers with U.S.-born individuals is unrealistic. The 90-day timeframe suggested in Mitchell's tweet for training new workers is considered highly optimistic given the scale of the workforce involved and the nature of the jobs. Past instances of strict immigration enforcement have demonstrated that rather than creating opportunities for U.S.-born workers, they often lead to widespread economic disruption, reduced productivity, and increased operational costs for businesses, ultimately harming the overall economy.