In Data: The economic cost of Trump's mass deportation plan

MEXICO CITY - To supercharge his mass deportation crackdown, U.S. President Donald Trump plans to invoke the Alien Enemies Act, a wartime law to quickly deport immigrants alleged to be gang members, without court hearings.

Trump also wants to expand a detention facility at the U.S. naval base at Guantanamo Bay to hold some 30,000 migrants and end Temporary Protected Status for about 348,000 Venezuelans, who could then be deported.

But the mass deportation plan has economic consequences.

Here is what you need to know about the economic impact:

How many workers are we talking about?

Out of the estimated 11 million undocumented immigrants living in the United States in 2022, 8.3 million were part of the workforce that year, according to the Pew Research Center.

While undocumented immigrants only represented 4.8% of the U.S. labour force in 2022 – almost 90% are aged between 16 and 64 and so have a high participation in the workforce.

A study published in the Journal of Labor Economics found 'Secure Communities' - an immigration policy that resulted in the deportation of more than 400,000 people between 2010 and 2015 - led to a decline of 2.5% in the employment rates of U.S.-born workers.

Trump's mass deportation plan would have the biggest impact on California, Texas and Florida, where one in every 20 residents are undocumented immigrants, according to estimates by the American Immigration Council.

Which industries will be affected?

The employment of undocumented immigrants sustains multiple industries, such as manufacturing, agriculture and construction.

Undocumented migrants also represent one in every 14 workers in the hospitality industry, and a quarter of cleaners.

According to research by the American Immigration Council, 14% of workers in the construction industry are undocumented immigrants.

The loss of undocumented migrant workers could exacerbate a labour shortage in the construction industry, which had 288,000 unfilled vacancies in September, and diminish housing supply at a time when there is already a housing shortfall.

Immigrants represent one in eight workers in agriculture so mass deportations would lead to labour shortages and higher food prices, the Peterson Institute for International Economics said.

This would impact inflation, with prices rising up to 9% in a scenario where the highest number of workers were deported, it said.

How important are undocumented workers to U.S. economy?

The Peterson Institute for International Economics estimates the U.S. economy could shrink by 1.2% by 2028 if the government deported 1.3 million people, which it considers to be at the low end of its goal.

Gross domestic product could fall by 7.4% in the same period if all 8.3 million undocumented immigrants working in the United States are deported, it said.

Total immigrants - both legal and undocumented - have accounted for a fifth of the country's real GDP growth since 2019, according to an analysis by Ernie Tedeshi, the director of Economics at the Yale Budget Lab. 

They contributed $4.6 billion in consumer spending and $48 billion in personal income - or overall earnings - in 2023, according to economic policy initiative Hamilton Project.

Tedeshi's analysis also found the U.S. labour force would have shrunk by 1.2 million between 2019 and 2023 without the presence of immigrants, making them an important source of tax revenue.

Mass deportation could lead to a massive loss of tax revenues and contributions to social benefits, according to research by the Institute on Taxation and Economic Policy, particularly in states with high numbers of undocumented workers such as California and Texas.

Undocumented immigrants paid $96.7 billion in federal, state and local taxes in 2022.

Undocumented workers contributed $25.7 billion to social security, $6.4 billion to Medicare and $1.8 billion to unemployment insurance in 2022, even though they are not always eligible for such programmes.

This group contributed $8.5 billion in taxes to California, $4.9 billion to Texas, $3.1 billion to New York, and $1.8 billion to Florida in 2022, the research showed.

This article was updated on Feb 5 2025, to include the latest developments.

(Reporting by Diana Baptista; Editing by Anastasia Moloney, Ana Nicolaci da Costa and Jon Hemming.)