A major gap has emerged in President Donald Trump’s deportation strategy, according to a new report.
The Trump administration has repeatedly argued that mass deportations would boost wages and create more jobs for American-born workers by reducing competition from undocumented labor.
But a new study from the nonpartisan National Bureau of Economic Research finds the opposite effect: recent deportation surges have been linked to job losses for both immigrant and American-born workers, with wages largely unchanged.
The impact has been most pronounced in agriculture, construction, manufacturing, and wholesale trade, where enforcement actions appear to have cooled hiring across the board.
Men were especially affected, making up more than 90 percent of immigration arrests in the data, with employment among male undocumented workers falling by 5 percent and dropping 1.3 percent for American-born men without college degrees.
But it is the construction industry—where researchers estimate that around 15 percent of the industry’s workforce is undocumented—that has been hardest hit by Trump’s mass deportation program.
At his February State of the Union address, Trump claimed that the economy had created thousands of new construction jobs, declaring: “More Americans are working today than at any time in the history of our country.”
But the report found that employment fell by 7.5 percent for undocumented workers and 3 percent for American-born men without college degrees in the construction sector.
The study suggests that for every undocumented worker arrested, roughly six American-born workers also lost jobs in the construction industry.
Overall, construction employment declined, down 1.5 percent in April compared with the previous year, according to federal data, while residential building permits fell 7.4 percent year-over-year in March 2026.
Researchers also found no evidence that employers raised wages to attract American workers to the construction industry, concluding instead that overall activity simply slowed.
“Construction companies view it as easier to reduce production, reduce the construction of new homes and new buildings in general, rather than try to increase wages for U.S.-born workers,” Chloe East, an author and economics professor at the University of Colorado, told The New York Times.
It is not the first time a report has found that Trump’s immigration policy could lead to job losses.
Projections from the Washington D.C.-based think tank National Foundation for American Policy previously indicated that Trump’s mass deportation policy could slash the workforce by 15.7 million by 2035.
Meanwhile, an Axios report from October 2025 found that Trump’s immigration crackdown could reduce “GDP growth by about half a percentage point between fiscal 2025 and fiscal 2035” due to employment deficits.
The report found that there could be 6.8 million fewer jobs as soon as 2028, with 2.8 million lost through legal immigration policy and 4 million through illegal immigration crackdowns.
It comes as businesses are already feeling the strain from the effects of Trump’s tariffs, and his war with Iran, which has seen energy prices spike.
An analysis by Democratic staff on the U.S. Congress Joint Economic Committee this month found that firms with fewer than 10 employees have cut jobs for 13 straight months, with small “mom-and-pop” businesses shedding about 292,200 jobs in 2025 — the steepest annual decline in a decade and far worse than the 87,800 jobs lost in 2024.
“Small businesses are getting frustrated. They can’t make ends meet, and some are going out of business,” manufacturing business owner Shirley Modlin told CNN. “Stop the game-playing. This is not a game. This is people’s lives.”
