Is mass deportation truly the golden ticket to fatter paychecks and a booming economy or a shortcut to smaller wallets and bigger problems? Let’s dive into what the latest research and real-world numbers indicate about the economic shockwaves that mass deportations would send rippling through America’s workforce, GDP, and even your own financial security.
1. Reducing GDP and Increasing Deficits: The Hard Numbers
When politicians make economic miracle promises, it’s tempting to assume the best. But the Penn Wharton Budget Model analysis reported to CNN gets to the bottom line: eliminating 10% of unauthorized immigrants annually for four years would reduce GDP by 1% and jack up federal deficits by $350 billion. And if the crackdown runs a decade, GDP reduces by 3.3%, wages decrease by 1.7%, and deficits blow up by $987 billion. As Wharton School professor Kent Smetters said, “There is no question the US economy will get smaller as you deport a lot of the workforce. You simply have fewer bodies to produce. Fewer people means a smaller economy.” The price does not end there: the estimated cost of a one-time mass deportation is $315 billion, and the cost of a long-term operation would average $88 billion annually.
2. Who Gains and Who Loses? The Worker Divide
It’s natural to assume that fewer workers = better pay for all those remaining behind. That’s not the way it is. Lawful, lower-skilled workers could get a 5% pay increase by 2034 because there’d be less competition around, but that increased compensation is fleeting if deportations are rolled back. While that’s happening, high-skilled workers, i.e., those with college degrees or specialized training lose the most. “More-skilled workers are more hurt by deportation than lower-skilled workers are benefited who are here legally,” the Penn Wharton study discovered. Smetters cautions, “If you’re higher income to middle class, you’re going to be hurt by deportation because you depend on lower-skilled workers to make your work less difficult and make your life easier.” The typical high-skilled worker would experience a $2,764 reduction in yearly earnings over a decade.
3. The Domino Effect of the Labor Market
Deportations don’t only impact who’s deported but travel in waves through whole industries. A good example is agriculture: 42% of farmworkers on crop farms had no work authorization from 2020 to 2022. “There are many jobs in the US that native-born individuals aren’t willing to do – and foreign-born individuals are willing to take,” stated Stephanie Roth, chief economist at Wolfe Research. Construction, restaurants, and factories depend on immigrant workers. When they vanish, companies cannot find workers to replace them, productivity is lost, and prices increase. Almost 14% of construction laborers are illegal, and their loss would be a disruption in everything from house construction to roadwork.
4. The Aging Population and Worker Shortages
America is aging quickly. As Baby Boomers retire, the numbers of available workers decline, making it even more difficult for companies to find them. By 2030, Americans 65 years and older will represent 21% of the population. Without immigration, the American workforce would contract, and labor shortages would worsen. The Conference Board calculates the U.S. needs to bring 4.6 million workers on board per year just to remain pace. That’s a lot to ask when the labor participation rate for older workers is declining and there aren’t enough young workers filling the gaps.
5. The Fiscal Consequences: Social Security and Tax Receipts
It’s not only GDP and wages on the line public finances suffer as well. Unauthorized immigrants contributed approximately $24 billion in Social Security taxes in 2024, even though they don’t qualify for benefits. Deporting these workers accelerates the depletion of the Social Security Trust Fund by six months and increases the program’s long-term deficit by 0.25% of payroll. Replacing this lost revenue would require raising payroll taxes by $180 per year for the median U.S. household, with that amount growing annually. Over the next decade, deportation policies could raise deficits by $133 billion to $884 billion, depending on their scope and duration.
6. Real-World Labor Market Impacts
The argument that taking out immigrant workers puts U.S.-born workers into jobs doesn’t work in the real world. Recent data from the labor market indicate that the foreign-born workforce is down by 735,000 since January 2025, yet U.S.-born workforce participation fell as well. “The figures for the past half-year reveal a drastic decline in the number of immigrant workers.”. Even with increases in the unadjusted figures, the seasonally adjusted labor force total and the U.S.-born labor force participation rate indicate that the deportation of immigrant workers is not inducing more U.S.-born workers into the workforce,” said Mark Regets, a labor economist. In fact, research on previous surges in deportations, such as the Secure Communities program, indicated that both immigrant and U.S.-born jobs fell in targeted counties.
7. Uncertainty in Economic Forecasting
It’s important to remember that economic models, while useful, come with a margin of error. Estimates of GDP loss from mass deportations range from 2.6% to 6.8% over a decade, and the effects on inflation are less clear. The Dallas Fed’s structural VAR model shows that an unexpected increase in unauthorized immigration raises U.S. output growth for about two years, with little impact on inflation. But as the authors point out, “the projected effects are highly uncertain, since the estimates have large error bands including zero in many instances.” Policymakers and experts must treat these forecasts with skepticism, anticipating a range of possibilities and integrating flexibility into their fiscal plans.
8. Creating Personal and Policy Resilience
Under so much uncertainty, how do people and policymakers get ahead? For households, responsible budgeting and rainy-day savings are even more important in the face of policy-driven economic change. For policy professionals, the message is simple: comprehensive immigration reform, not mass deportation, is the sustainable route forward. That requires updating visa programs, increasing legal pathways for necessary workers, and promoting upskilling and workforce participation across demographics. As RSM chief economist Joe Brusuelas put it, the Penn Wharton study “shines a light on just how important rational immigration policy is to the health of the American economy.
Mass deportations might be an apparent shortcut, but the numbers tell a different tale one of dwindling checks, shortages of workers, and larger deficits. The task at hand is to create a labor market and economy that work for all, regardless of where they were born.
