Will stopping immigration cause labor shortages?

Short answer: It depends on the sector, but in several key industries, yes — and there's real-world evidence of this happening now.

Where labor shortages are most likely

Immigrants make up a disproportionate share of workers in certain physically demanding, low-wage sectors that many U.S.-born workers avoid. Foreign workers make a particular contribution in low-wage, manual labor sectors where U.S. citizens typically prefer not to work, accounting for 43% of farm workers, 30% of food production and processing workers, 28% of construction workers, and 20% of leisure and hospitality workers. In agriculture specifically, experts say the industry could suffer as immigration crackdowns continue, since 68% of farm laborers in fiscal year 2021–22 were foreign-born.

Current evidence (2025 U.S. immigration crackdown)

The Trump administration's recent enforcement actions provide a real-time test case:

The counterargument

Not all economists agree this is inevitable. A St. Louis Fed study of COVID-era immigration restrictions found the opposite pattern: no evidence that immigration shortfalls caused the tight post-pandemic labor market — the immigration deficit had largely recovered before labor tightness increased, and hardest-hit states/industries didn't see larger tightness increases. This suggests other factors (retirements, demand shifts, savings buffers) can also drive shortages, and immigration's role isn't always the dominant one.

Underlying structural pressure

Even without policy changes, demographics are working against labor supply: the U.S. birth rate has been declining since 2007, a long-term trend showing no signs of reversing, and for years this has been offset by steady in-migration. Many economists note that immigration is one of the most effective tools for maintaining a stable ratio of workers to retirees and supporting long-term economic competitiveness.

Bottom line

Stopping or sharply cutting immigration doesn't cause shortages everywhere equally — but in sectors like agriculture, construction, hospitality, and eldercare, where immigrants fill a large share of physically demanding roles domestic workers are reluctant to take, curbing immigration has already coincided with measurable staffing gaps, rising wages, and higher consumer prices in 2025. Whether this qualifies as a "shortage" long-term also depends on wage adjustments, automation, and whether native-born workers eventually fill the gap — economists disagree on how completely that substitution happens.