Will stopping immigration cause labor shortages?
I will look into economic studies, labor market data, and historical examples on how immigration affects workforce supply.Yes, sharply reducing or stopping immigration is likely to cause or worsen labor shortages in many sectors of the economy, particularly given current demographic trends, though the effects are not uniform and can be partially mitigated by other factors.[1]
Immigrants (foreign-born workers, both authorized and unauthorized) make up a substantial share of the U.S. labor force—around 18–20% overall in recent years—and an even higher share in specific industries. They have driven a large portion (often nearly all) of recent U.S. labor force growth as the native-born working-age population stagnates or shrinks due to low fertility rates and aging (Baby Boomers retiring). Without sustained immigration, labor force growth slows dramatically, reducing the economy’s potential for job creation and GDP growth.[2]
Key Evidence on Labor Supply and Shortages
Immigrants Often Complement Rather Than Simply Displace Natives
Economic research (including reviews of many studies) generally finds that immigration has small or near-zero average effects on native employment and wages overall, and often positive effects through several channels:
Deportation or sudden removal studies often show that removing immigrant workers reduces employment opportunities for natives as well (e.g., one estimate: for every six undocumented men removed from employment, one U.S.-born man also loses a job). The “lump of labor” fallacy (fixed number of jobs) does not hold; the economy expands or contracts with the workforce.[7]
Historical Parallel: 1920s Quotas
The U.S. sharply restricted immigration via national-origins quotas in the 1920s. Effects were mixed and context-dependent (different demographics, less aging population then):
Nuances, Mitigations, and Counterpoints
Shortages are not inevitable forever or absolute. Higher wages, better working conditions, automation/robotics, vocational training, higher native labor force participation (e.g., among prime-age men or through childcare policies), internal migration, or offshoring can partially offset reduced immigration. In some low-skill niches, reduced supply can raise wages for remaining workers (immigrant or native). High-skill restrictions can specifically hurt tech, healthcare, and innovation.[9]
However, many of these adjustments take time, raise costs (contributing to inflation or reduced output), or are incomplete—natives often show limited willingness or mobility for certain jobs even at higher pay. Mass removal of existing workers is more disruptive than gradually slowing new inflows. Guest-worker or targeted legal pathways can address shortages without open borders.
In short, in an aging society with low native fertility and concentrated immigrant roles in essential sectors, stopping immigration will reduce labor supply relative to demand, causing shortages (or tighter markets, higher costs, slower growth, and firm contractions) in agriculture, construction, hospitality, care work, and related areas. Broader economic research supports that immigration expands the economic pie more than it redistributes fixed slices. Policy can shape the mix and legal status of immigrants to maximize benefits while addressing wage pressures or other concerns in specific markets.
Citations (9)
- https://www.deloitte.com/us/en/insights/topics/economy/spotlight/us-immigration-impact-us-economy.html
Backs: “I will look into economic studies, labor market data, and historical examples on how immigration affects workforce supply.Yes, sharply reducing or stopping immigration is likely to cause or worsen labor shortages in many sectors of the economy, particularly given current demographic trends, though the effects are not…”
evidence, article, points to yes. Claim: Sharply reducing or stopping immigration likely causes or worsens labor shortages given demographic trends; lower net immigration cuts labor force and GDP growth.
- https://www.epi.org/publication/the-u-s-born-labor-force-will-shrink-over-the-next-decade-achieving-historically-normal-gdp-growth-rates-will-be-impossible-unless-immigration-flows-are-sustained/
Backs: “They have driven a large portion (often nearly all) of recent U.S. labor force growth as the native-born working-age population stagnates or shrinks due to low fertility rates and aging (Baby Boomers retiring). Without susta”
evidence, official document, points to yes. Claim: Without sustained immigration, labor force growth slows dramatically, reducing job creation and GDP growth potential as the US-born labor force shrinks.
- https://www.recruitonomics.com/p/sector-by-sector-mapping-the-labor
Backs: “These are frequently physically demanding, seasonal, lower-wage, or less preferred by many native-born workers at prevailing conditions. Stopping inflows or removing workers via enforcement creates immediate gaps that natives do not fully fill.”
evidence, article, points to yes. Claim: Immigrants fill disproportionate shares of jobs in agriculture, construction, hospitality and other sectors; stopping inflows creates gaps natives don't fully fill.
- https://www.washingtonpost.com/opinions/2026/04/14/immigration-crackdown-causes-massive-shortages-unskilled-labor/
Backs: “Some analyses of enforcement actions find net job losses that spill over to U.S.-born workers (e.g., firms shrink, reducing demand for complementary native labor).”
evidence, article, points to yes. Claim: Crackdowns have been linked to shortages and net job losses that spill over to US-born workers as firms shrink.
- https://www.nber.org/digest/202606/what-happens-when-flow-immigrant-workers-suddenly-stops
Backs: “They did not significantly expand hiring of native Koreans; instead, they demanded more guest workers. Wages for some native workers declined.”
evidence, article, points to yes. Claim: South Korea's guest worker halt shrank the foreign workforce about 22%, raising firm closures without significant hiring of native workers.
- https://cepr.org/voxeu/columns/revisiting-immigrations-effect-us-wages-and-employment
Backs: “Firm-scale effects: Access to immigrant labor allows businesses to grow and hire more of everyone, including natives. Restrictions can shrink firms.”
evidence, article, neutral. Claim: Research finds small average effects on native wages and employment; immigrants complement natives and let firms grow and hire more.
- https://www.thirdway.org/memo/front-door-welded-shut-how-trump-is-dismantling-legal-immigration
Backs: “Deportation or sudden removal studies often show that removing immigrant workers reduces employment opportunities for natives as well (e.g., one estimate: for every six undocumented men removed from employment, one U.S.-born man also loses a job). The “lump of labor” fallacy (fixed number of jobs) does not hold; the…”
evidence, article, points to yes. Claim: Removing immigrant workers reduces native employment too; the lump of labor fallacy does not hold.
- https://economics.princeton.edu/working-papers/the-effects-of-immigration-on-the-economy-lessons-from-the-1920s-border-closure/
Backs: “Some studies find occupational downgrading or wage declines for certain native groups in highly exposed areas; manufacturing wages were often little affected.”
evidence, article, neutral. Claim: 1920s quotas had mixed effects: some wages rose, but natives didn't broadly benefit, and economies adapted via automation and internal migration.
- http://dx.doi.org/10.29338/wp2024-01
Backs: “In some low-skill niches, reduced supply can raise wages for remaining workers (immigrant or native). High-skill restrictions can specifically hurt tech, healthcare, and innovation.”
evidence, official document, points to no. Claim: Higher wages, automation, training and participation can partially offset reduced immigration; reduced supply may raise wages in some low-skill niches.