Will stopping immigration cause labor shortages?

Will a halt to immigration create labor shortages? I'll pull the latest research on workforce and demographic trends to answer.

Yes, according to most economic and demographic research on the U.S., stopping immigration would cause - and is already causing - labor shortages, particularly in the medium to long term.

1. Demographics: The U.S. workforce is already shrinking without immigration

The U.S. is aging, birth rates are low, and Baby Boomers are retiring. Immigration has become the main source of growth for the working-age population.

•As the baby boom generation ages and retires, immigrants will make up the majority of working-age population growth, increasing by 17.6 million new immigrants by 2035 resulting in a working age population of 183 million. Without immigration, the U.S. workforce would decline from 173 million in 2015 to just 166 million in 2035.

•Pew Research makes the same projection: without immigrants, total U.S. workforce population — those ages 25 to 64 — would fall from 173.2 million in 2015 to 165.6 million in 2035.

•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

•"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"

As one analysis summarized:

> “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.”

The Congressional Budget Office (CBO) has also stated: "Without immigration, the U.S. population would begin to shrink in 2033."

2. Projected labor force loss if immigration stops

Recent projections estimate a large direct loss of workers:

•The CBO projects that reduced immigration will shrink the labor force by 15 million jobs by 2035

•A National Foundation for American Policy (NFAP) analysis found the policies could reduce cumulative GDP by $1.9 trillion by 2028 and: By 2028, the projected workforce could be reduced by 6.8 million workers—2.8 million due to changes in legal immigration, 4 million from illegal immigration enforcement. By 2035, that number could reach 15.7 million fewer workers

•The same analysis summarized: “The Trump administration’s policies on illegal and legal immigration would reduce the projected number of workers in the United States by 6.8 million by 2028 and by 15.7 million by 2035”

•A Brookings Institution report found that the immigration surge into U.S. cities last year resulted in 668,000 job losses, creating a "chilling effect" that pervaded local economies, and that immigration enforcement reduced construction employment for American-born workers and slowed homebuilding

The CBO now projects average annual labor-force growth of just 0.4 percent between 2026 and 2029, compared with an average 1.6 percent during the four years following the pandemic, because “The reduction in net migration slows the growth of the labor force”.

3. Shortages are concentrated in specific, immigrant-heavy sectors

Stopping immigration does not affect all industries equally. The labor shortage United States is most acute in sectors heavily reliant on immigrant labor. This includes agriculture, construction, hospitality, and healthcare support

Estimates for dependence:

•With immigrant workers comprising 25% of construction labor, 66% of agriculture workers, and 15–28% of healthcare staff

•Other data: Immigrants make up around 25% of the construction workforce and up to 50% of the agricultural workforce in some areas

•In construction, surveys found 58 percent of employers indicate that there is a labor shortage, with wage growth in construction failing to solve the problem.

Research concludes: Boosting immigration can help mitigate the labor challenges facing the industry, as it would increase labor supply. Conversely, policies that seek to restrict levels of job-seeking immigrants will likely exacerbate labor shortages, especially when considering the decline in labor force participation among native-born workers.

Recent industry reports have linked enforcement directly to shortages: 45% of construction firms reported project delays attributable to ICE-related labor shortages, and homebuilders have reported that enforcement is “causing labor shortages” and “causing a strain on both the labor force, labor costs and cycle times.”

4. Would native-born workers, automation or higher wages fill the gap?

Arguments against the shortage claim say that:

•Higher wages would attract Americans back to these jobs

•Automation, AI, and telehealth may offset shortages in the long term

•More young people could be trained in skilled trades

In practice, economists note that:

•Many who left the workforce during the recession have gone to other industries and have not returned, and fewer young workers are entering the skilled trades

•Immigrant workers are, on average, more likely to be of prime working age than native-born Americans, and immigrants participate in the labor force at higher rates than native-born Americans.

•Construction employers have increased wages to attract more workers... but this has failed to solve the problem

For now, the consensus among CBO, Pew, Brookings, Bipartisan Policy Center, and Federal Reserve researchers is that without continued immigration, the U.S. will face a structurally smaller and older workforce, making labor shortages broader and more persistent — especially in agriculture, construction, hospitality, and elder care/healthcare — leading to slower GDP growth, higher costs, and higher prices for housing and food.

Citations (2)

1fastcompany.comNews and mediaquality 0.80
Immigrants will play primary role in future growth of working-age population
Backs: “is aging, birth rates are low, and Baby Boomers are retiring. Immigration has become the main source of growth for the working-age population. As the baby boom generation ages and retires, immigrants will make up the majority of working-age population growth, increasing by 17.6 million new immigrants by 2035 resulting…”
2bipartisanpolicy.orgNonprofits and think tanks
Worsening Labor Shortages Demonstrate Need for Immigration Reform
Backs: “Other data: Immigrants make up around 25% of the construction workforce and up to 50% of the agricultural workforce in some areas”