Will stopping immigration cause labor shortages?

Stopping immigration — would it trigger labor shortages? I'll pull the latest evidence on workforce impacts.

Yes, economic research indicates stopping immigration would likely cause labor shortages - though effects would be delayed, localized and concentrated in specific industries rather than an immediate nationwide shortage.

1. Demographic baseline: US workforce shrinking without immigration

•The US fertility rate is 1.6, below the 2.1 replacement rate since 2008, and deaths are projected to exceed births around 2030.

•The Federal Reserve Bank of San Francisco found that without immigration, the U.S. working-age population would have started shrinking in 2012, not 2025.

•Brookings estimates the population declines by 7 million by 2040 without immigration.

•The native-born labor force declined in 2024 to 135.8 million from 136.1 million in 2023, and without immigration, the prime-age U.S.-born labor force was projected to grow at a rate 0.8 percentage point lower than earlier Congressional Budget Office forecasts.

•The Congressional Budget Office now forecasts the U.S. working-age population will grow at a mere 0.3% annually.

Recent trend: Net migration dwindled from 2.7 million in 2024 to an expected 321,000 in 2026. Between 2024 and 2025, net migration dropped 77 percent, with Goldman Sachs analysis showing net migration has fallen 80% from the historical baseline, to just 200,000 projected for 2026. In 2025 net migration may have been negative for the first time in at least 50 years.

The broad research consensus summarized by equitablegrowth.org:

> Reduced immigration contributes to labor shortages, driving inflationary pressures as the supply of immigrant-dependent goods and services shrinks.

> Labor shortages in key industries including health care and construction have plagued the U.S. economy since the COVID-19 pandemic...in large part due to a decline in immigration during the pandemic.

2. How large is immigrant labor share?

•Foreign-born workers accounted for 19.1% of the US civilian labour force in 2025, according to the Bureau of Labor Statistics. Other estimates put it at about 19.2 percent and 18.6% of the U.S. labor force.

•In 2024, foreign-born workers were more likely than native-born workers to be employed in service occupations, natural resources, construction and maintenance, and production, transportation, and logistics. These are sectors with chronic labor shortages.

3. Most exposed sectors

Research shows a broad slowdown can produce highly specific shortages:

Construction: Construction is the most immigrant-dependent industry. Nearly 30% of all construction workers, more than 3.5 million people, are foreign-born. One in four workers in the construction industry were immigrants in 2022, over 40% in California and Texas, and the Associated Builders and Contractors estimates a shortage of about 500,000 workers, with a similar estimate of shortage exceeding 500,000 workers nationwide.

Agriculture: Foreign-born workers make up roughly 70 percent of the nation’s farm workforce. According to the U.S. Department of Agriculture, approximately 48% of farmworkers are undocumented immigrants. Nationwide, 54.3% of graders and sorters of agricultural products are immigrants, as are 25.3% of workers in the agriculture industry overall.

Healthcare: The Bureau of Labor Statistics projects the country will face a shortage of 134,940 healthcare providers by 2036. Nationally, 15.6% of all nurses and 27.7% of all health aides are immigrants, and roughly one-in-four medical doctors in the United States is foreign-born.

Other affected sectors include hospitality, logistics, transportation and utilities where immigrants comprise approximately 24.4% of workers, with trucking alone facing shortfall of more than 60,000 drivers.

4. Does reducing immigration help native-born workers?

Economic literature argues the "lump of labor" idea is faulty:

> Arguments in favor of stringent immigration—that less immigration will mean more opportunities for native-born workers—rely on the faulty premise that immigrants and native-born workers compete for the same jobs as close substitutes. Frequently, immigrants work in jobs that are complementary to native-born workers.

Examples:

•A native-born engineer, architect, plumber, or electrician would find fewer work opportunities if immigrant construction laborers were deported.

•Historical cases: The "bracero exclusion" in 1964 removed nearly half-a-million Mexican agricultural workers, did not result in promised boost to native-born farm wages and employment; jobs were replaced by machines or eliminated. Arizona's harsh laws reduced undocumented worker population by 40 percent between 2007 and 2012, resulting in decreased economic output and a 2 percentage point increase in unemployment rate for low-skilled native-born White men.

Recent data since the 2025 crackdown:

•Data shows the foreign-born labor force has declined by about 1.2 million people since January. Since January 2025, the foreign-born workforce has shrunk by 881,000 workers, and from a March peak the drop is 1.3 million.

•The unemployment rate for U.S.-born workers rose from 3.7% in December 2024 to 4.1% by December 2025, contradicting the claim that fewer immigrants automatically boost native employment. One year into crackdown, there's little evidence that closed borders are boosting employment for US-born workers.

CBO and other models: A recent CBO report increased its official projections of long-run GDP growth by $7 trillion to account for estimated increase in immigration. Conversely, a mass deportation on the scale advocated could permanently shrink the U.S. economy by as much as 6 percent. The National Foundation for American Policy projects cumulative reduction could reach 6.8 million workers by 2028 and 15.7 million by 2035, enough to lower annual economic growth rate by almost a third.

5. Nuance and counterarguments

Not all research predicts an immediate nationwide labor shortage:

•An Oxford Economics analysis in July 2026 found: The crackdown has the potential to tighten labor market conditions, but our analysis shows this has yet to unfold. Job openings and unemployment rates in high-exposure industries show little divergence. Lags between migration and joining labor market mean impact is delayed but not postponed indefinitely.

•The result may not be a national labour shortage in the conventional sense. It is more likely to appear as repeated local and occupational shortages: too few technicians in one region, too few carers in another.

Proponents of restriction argue:

•Tight labor markets could raise wages for native workers and incentivize automation and investment in domestic workforce, or offshoring of digitally deliverable work.

•Some argue that automation is often a response to artificial labor shortages created by restrictive immigration policies, rather than inevitable, suggesting automation could partially fill gaps.

However, most empirical literature finds that automation does not fully substitute, and that deportation is economically contractionary: halting immigration slows growth rates and attenuates opportunity for native-born workers, widespread deportations are actively contractionary and lead to native-born job losses, and reduced labor supply directly shrinks labor supply and weakens consumer spending by $60–$110 billion over 2025 and 2026.

Bottom line: Based on demographic trends (aging Baby Boomers, low birth rates) and heavy immigrant concentration in labor-intensive and shortage-prone sectors, economists generally conclude that stopping immigration entirely would worsen labor shortages, especially in agriculture, construction, healthcare, hospitality and logistics, shrink overall GDP, and not generate the expected job gains for native-born workers - though the effect would be uneven and take time to materialize fully.

Citations (2)

1equitablegrowth.orgNonprofits and think tanks
Economic research shows immigration is good for U.S. workers, the economy, and affordability
Backs: “The Congressional Budget Office now forecasts the U.S. working-age population will grow at a mere 0.3% annually.”
2americanimmigrationcouncil.orgNonprofits and think tanks
Immigrants Are Key to Filling US Labor Shortages, New Data Finds
Backs: “Construction: Construction is the most immigrant-dependent industry. Nearly 30% of all construction workers, more than 3.5 million people, are foreign-born.”