Will stopping immigration cause labor shortages?

Will halting immigration trigger labor shortages? I'll pull the latest research on workforce and demographic impacts.

Yes, most economic research and current data indicate that stopping or sharply reducing immigration would cause - and is already causing - labor shortages in the United States and other aging economies.

1. The U.S. workforce now depends heavily on immigrants

•Foreign-born workers accounted for about a fifth of the US labor market in 2024, and in 2023, immigrants constituted 18.6% of the U.S. civilian labor force.

•Tightened immigration controls are directly linked to growing labor shortages in key sectors of the U.S. economy.

•Labor shortages are growing in sectors that rely heavily on immigrant workers, including agriculture, construction, food service, healthcare, and transportation.

Those are described as sectors with chronic labor shortages and limited domestic supply pipelines. According to KFF, immigrants made up 24% of workers in residential care settings such as assisted living, 21% of workers in nursing facilities, and 32% to 40% of workers in home care in 2023.

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.

The Trump administration itself admitted in an Oct. 2 filing in the Federal Register that "The near total cessation of the inflow of illegal aliens combined with the lack of an available legal workforce... results in significant disruptions to production costs and (threatens) the stability of domestic food production and prices for U.S consumers".

2. Short and long-term macroeconomic projections

A sudden plunge in immigration reduces the labor force available to fill jobs that businesses expect to fill, which Brookings models say will dampen employment, GDP, and consumer spending and push sustainable monthly job growth well below historical norms—perhaps to 20,000–50,000 or even negative territory in 2026.

Other projections:

•The CBO, as a nonpartisan scorekeeper, finds that reduced immigration links to a smaller labor force, limiting how many jobs the economy can support.

•Over the next decade, the U.S. population is forecast to grow an average 0.3% each year, ... equates to a downward revision of 2.4 million fewer working-age Americans by 2035.

•The CBO report outlines the necessity for an immigrant workforce to help the nation's economy grow — otherwise the nation's population is expected to shrink into 2040 without immigration.

•The most striking news from the CBO's report was how clearly it stated that the U.S. population will start shrinking in 2042 without the expected increase in immigrant workers.

•Other analysis of CBO data found that deaths would begin to outpace births by 2033, meaning immigration would become the sole driver of population growth from that point forward. Put simply, without immigration, the U.S. population would begin to decline starting in 2033.

•Starting in 2044, CBO projects that natural population increase (births minus deaths) will turn negative. Without net immigration, our population would then start shrinking.

Under a zero-immigration scenario where immigration stopped for the next two decades, the U.S. working-age population would shrink 11% by 2040.

Researchers summarize:

> "The labor market implications of this are inseparable from a longer-term demographic reality: the United States is aging, and immigrants, on average, are more likely to be of prime working age than native-born Americans,” and “Put simply, immigration will soon become the primary mechanism keeping the population and the labor force growing. Without it, the U.S. will not just be facing a tighter labor market, but a shrinking one".

And: "Without the immigration surge of 2022 to 2024, the US working-age population would have been shrinking. The prime-age labor force grew in large part because of immigration".

Long term, economists warn that fewer immigrants could take a hit to the economy, prompting labor shortages and slowing economic growth.

3. Why native-born workers alone cannot fill the gap

The U.S., like Japan, South Korea, Germany and Italy, faces an aging population, falling birth rates and a growing share of retirees.

For Japan, which has historically had limited immigration:

•Chronic labor scarcity persists, underscoring deep structural issues: an aging and shrinking population, limited immigration, and the slow diffusion of automation.

•Japan faces one of the world's fastest-aging populations and one of the lowest birth rates among developed nations. Labor shortages are already affecting healthcare, elder care, transportation, hospitality, construction, agriculture, and other critical industries.

Business groups and economists argue the U.S. would face a similar pattern without immigration, because immigrants often fill jobs that native workers are unwilling or unable to do, especially in sectors like agriculture, healthcare, and hospitality.

4. Nuance — Does stopping immigration help some workers?

Supporters of tighter controls argue that strict policies protect American workers, reduce pressure on public services, and improve national security.

An immigration crackdown could tighten the labor market, increasing wages but risking labor shortages and inflation in key sectors.

In other words:

•Short-term, selective effect: In very tight local labor markets, reducing immigrant competition could raise wages for some low-skill native workers and lower unemployment in that subgroup.

•Medium/long-term, system-wide effect: Because the native-born birth rate is below replacement and Baby Boomers are retiring, the overall pool of workers shrinks. Employers report rising costs as they compete for a shrinking pool of workers, delays in construction and health care, and higher consumer prices. The National Academy of Sciences work cited by critics notes that while immigration can affect wages for some native-born workers, the overall economic benefits are large.

Most economists conclude a balanced approach — maintaining legal pathways for workers in shortage occupations, such as H-2A farmworker visas, health care visas, and construction — is needed to avoid a shrinking workforce while managing enforcement.

> Tightened immigration controls have tightened sharply since January 2025 and labor shortages are getting worse, especially in jobs that U.S.-born workers are less likely to take.

Citations (2)

1mcknightsseniorliving.comNews and media
Job market faces ‘macroeconomic consequences’ if immigration slows: report
Backs: “Yes, most economic research and current data indicate that stopping or sharply reducing immigration would cause - and is already causing - labor shortages in the United States and other aging economies. 1. The U.S. workforce now depends heavily on immigrants”
2visaverge.comCommercial content
Will US Immigration Restrictions Lead to a Shrinking Workforce?
Backs: “Foreign-born workers accounted for about a fifth of the US labor market in 2024, and in 2023, immigrants constituted 18.6% of the U.S. civilian labor force.”