The Trump administration has billed its “mass deportation” agenda as a necessity to bring about an age of prosperity for US-born workers. But a new report suggests it’s actually doing the opposite—exacerbating an already severe affordability crisis by suppressing wages, killing jobs, and raising costs.

On Wednesday, the ACLU and AFL-CIO published an analysis examining how the administration’s unprecedented deployment of Immigration and Customs Enforcement (ICE) agents to communities around the country has not only created a climate of fear, but also caused labor shortages, reduced economic activity, and given employers new tools to suppress employees’ wages.

“When ICE continuously raids a community, everyone pays for it—in lost jobs, higher prices, and damaged businesses,” said Naureen Shah, director of government affairs at the ACLU’s equality division.

Previous national data has already shown that, contrary to the Trump administration’s argument that rounding up immigrant laborers simply creates room for those born in the US, areas that have experienced increases in ICE activity have also seen employment reductions for US-born workers.

“In our interdependent labor market, harm to one group of workers spills over to all those who labor alongside them or within the same supply chain, regardless of immigration status. Roughly 1 in 5 workers in our country is an immigrant, spanning all sectors of the economy,” the report explains.

“Targeting this large and vital segment of the workforce sharply reduces the supply of labor, threatening the ability of employers to generate revenue and cover business expenses, including the wages of any remaining workers,” it continues.

Reducing the labor supply consequently reduces production. The report argues that this is why industries with large numbers of immigrant laborers have seen skyrocketing costs for their products nationwide.

Data from previous deportation surges during the Obama administration shows that immigration enforcement has reduced construction labor, resulting in nearly 2,000 fewer completed homes on average and an 18% increase in home prices.

In June 2026, data showed that while core inflation was just 2.6% over the previous year, prices had shot up much more dramatically in immigrant-heavy sectors: The cost of lettuce was up 32.1%, landscaping was up 10.8%, home health care climbed 10.7%, whole milk increased 9%, and canned fruit jumped 7.9%.

The report also argues that ICE surges, which have often involved racial profiling and indiscriminate targeting, use of excessive force, and arrests of US citizens, have created terror in communities that suppresses economic activity.

A May working paper from the Wharton School of Business at the University of Pennsylvania, which examined nearly 5,400 raids around the country during 2025, showed that areas targeted by ICE raids experienced a 2.7% decline in foot traffic and a 6.2% decline in spending per business per week, which the author extrapolated would amount to 8.1 billion fewer visits and as much as $14 billion in forgone spending annually across the nation.

US-born employees in sectors with large numbers of immigrant workers were hit especially hard. Data from “Operation Metro Surge” in Minnesota earlier this year demonstrates this in miniature.

Research released in June by the Upjohn Institute estimated that the surge of immigration agents cost the state’s leisure-and-hospitality sector 4,600 jobs, 3.8 million work hours, and $71 million in wages between January and March.

Economist Exequiel Hernandez, quoted in the ACLU/AFL-CIO report, said these findings highlight the danger of creating an “economy of fear.”

“If fewer people are showing up to work, they’re making less income, they’re spending less,” he explained. “If they’re spending less, businesses have to cut back in hiring and selling, and it’s really quite damaging.”

The report cites projections from the Economic Policy Institute (EPI) last year on what this could mean if the Trump administration meets its target of deporting 1 million people per year.

Using data from previous immigration enforcement studies, the EPI estimated that nearly 6 million fewer people could be employed by the end of President Donald Trump’s second term if the administration follows through on its deportation promises. That includes 3.3 million immigrants, but also 2.6 million US-born workers, many of whom are working in immigrant-heavy sectors.

The report argues that a pathway to citizenship rather than deportation would not only be a more humane solution, but also deliver economic benefits that ripple through the economy, including for US-born residents.

It cites projections that allowing undocumented immigrants to become citizens would increase US gross domestic product (GDP) by nearly $2 trillion over a decade and generate hundreds of billions in new tax revenue.

This is because legalization would allow workers to move into jobs that better match their skills rather than being confined to low-paying jobs that tend to accept them. It would also remove immigration enforcement as a threat that employers could use to suppress wages, both for immigrant and US-born workers.

“Working people are paying the price for an immigration system that is destabilizing entire industries and communities and making it easier to exploit workers,” said AFL-CIO president Liz Shuler. “As this report demonstrates, a broad pathway to citizenship for all would raise wages, create more and better jobs, and strengthen our economy in ways that help all of us.”

From Common Dreams via This RSS Feed.