By Richard T. Herman, Esq.
The Trump administration’s sweeping immigration restrictions have sparked intense debate over their long-term impact on the U.S. economy and labor force. The trump administration’s policies, which included a range of measures affecting both legal and illegal immigration, have had a broad impact on immigration and the workforce. According to a recent analysis, these policies could reduce the U.S. workforce by 15.7 million workers by 2035. In addition, trump administration’s immigration policies are projected to significantly affect the labor market and slow economic growth.
This contraction in the labor force is expected to have far-reaching consequences, with the number of workers projected to decline sharply as a result of these restrictive measures. The reduction in foreign-born workers, in particular, is likely to exacerbate existing labor shortages in key sectors.
The administration’s stated goal of deporting at least 1 million immigrants further underscores the scale of these changes. However, trump’s immigration crackdown risked causing labor shortages and economic disruption across multiple industries, including agriculture, healthcare, and technology.
A recent NFAP report highlights that, without a significant increase in immigration, the U.S. labor force will shrink dramatically over the next decade—a projection supported by data from the labor statistics household survey. This underscores the critical role of immigrants in sustaining workforce growth and economic vitality.
A Looming Labor Shock
A new study from the National Foundation for American Policy (NFAP) warns that the second Trump administration’s sweeping immigration restrictions could reduce the U.S. workforce by 15.7 million workers by 2035 and slow economic growth by nearly one-third. The Trump administration’s policies could decrease the U.S. labor force by 6.8 million by 2028 and 15.7 million by 2035.
The analysis projects a sharp contraction in the nation’s labor force—driven by curbs on both legal and unauthorized immigration—that would reverberate across industries and increase federal debt. These policies aim to restrict legal immigration through measures such as suspending refugee admissions, implementing travel bans, and ending temporary protected status, which is expected to further limit the number of legal immigrants entering the workforce. The Trump administration has set a goal of deporting at least 1 million immigrants from the country illegally each year, further exacerbating labor shortages and economic challenges for industries facing labor shortages such as agriculture, healthcare, and manufacturing.
According to the NFAP report, U.S. employers could see 6.8 million fewer workers by 2028 and 15.7 million fewer by 2035, as immigration inflows slow, deportations rise, and key visa programs are curtailed. These policies significantly reduce the projected number of workers in the U.S. labor force. The result: fewer goods and services produced, tighter labor markets, and weaker GDP growth. The decline in foreign-born workers, including the foreign born workers exit from the labor force, is expected to have a substantial impact on labor market dynamics and overall employment levels.
The Study’s Core Findings
Fast Fact:“A shrinking labor force, slower GDP growth, and rising federal debt are the predictable outcomes of mass immigration restriction.”
The NFAP’s economic modeling suggests that between 2025 and 2035: The estimated loss in GDP is projected to be $1.9 trillion from 2025 to 2028 and $12.1 trillion from 2025 to 2035 due to reductions in the workforce.
- The labor force would contract by 4 million workers by 2028, and by 11 million by 2035, compared with baseline projections, with ending Temporary Protected Status (TPS) contributing significantly to this reduction.
- GDP growth would fall from a baseline of 1.8% to 1.3% annually—a reduction of roughly one-third, as these policies are expected to reduce GDP growth by limiting labor supply and productivity.
- The cumulative loss in output could reach $12 trillion by 2035 (in 2025 dollars).
- The public debt could climb by $1.7 trillion due to lower tax receipts and slower growth.
The administration has stated that its immigration enforcement measures are part of an agenda to create jobs for American workers, aiming to bolster employment opportunities for U.S. citizens by restricting immigration.
The think tank emphasizes that immigration has historically been the engine of U.S. labor-force expansion. Between 2019 and 2024, immigrant workers accounted for nearly 85 percent of the nation’s labor-force growth, according to NFAP data and Bureau of Labor Statistics surveys. Immigrant workers accounted for 84.7% of the labor force growth in America between 2019 and 2024. Trump’s immigration policies, as analyzed in the study, are projected to significantly reduce the workforce and negatively impact the broader U.S. economy.
Policies Driving the Decline
NFAP’s model incorporates a broad set of initiatives rolled out or proposed under President Donald Trump’s 2025 immigration agenda, including:
- Ending or suspending refugee admissions.
- Imposing travel bans on 19 countries.
- Terminating Temporary Protected Status (TPS) for nationals from long-standing recipient countries.
- Eliminating work authorization for international students under Optional Practical Training (OPT) and STEM OPT.
- Tightening family-based and employment-based immigration quotas.
- Expanding interior enforcement and worksite audits.
- Allocating $45 billion in taxpayer funds to bolster border and immigration enforcement, including increasing ICE detention capacity.
- Implementing restrictions on illegal immigration, which are expected to significantly impact the workforce and contribute to labor shortages.
- Suspending or terminating humanitarian parole programs, further limiting legal pathways for immigrants and refugees.
The labor department admitted earlier in the month that these policies, including the near total cessation of illegal inflow, could cause a labor shortage due to their impact on the available workforce.
Notably, the analysis does not yet include the administration’s proposal for a $100,000 one-time H-1B visa fee, which economists say could further deter employers from hiring global talent.
These measures are part of Trump’s immigration policies, which have a broader impact on the U.S. labor force and economy. The projected number of workers expected to be lost due to these policies is in the millions, highlighting the significant consequences for future workforce growth and economic productivity.
“Immigrants have become indispensable to labor-force growth,” NFAP Senior Fellow Mark Regets explained in the study. “When immigration slows, job creation and productivity fall across the board.”
Early Signs of Contraction
The Bureau of Labor Statistics household survey already indicates a decline of 1.1 million foreign-born workers since January 2025. The decline in foreign-born workers is already evident, with a reported decline of 1.1 million foreign-born workers since the start of the Trump administration. This reduction includes a significant number of undocumented immigrants, whose absence has contributed to labor shortages in key industries and disrupted the labor market.
Of the 6.8 million fewer projected workers by 2028, NFAP attributes roughly 2.8 million to legal-immigration cutbacks and 4 million to policies affecting unauthorized immigrants. These changes have a direct impact on american labor force growth, as both legal and undocumented immigrants are vital to expanding the overall workforce and supporting economic growth.
Meanwhile, U.S.-born labor-force participation remains virtually flat—61.6% in August 2025, compared with 61.7% the previous year—suggesting that native-born workers are not replacing departing immigrants. The labor force participation rate for U.S.-born workers aged 16 and older has decreased from 61.7% to 61.6% year over year. The administration’s policies emphasize that american workers represents a key focus, but the data shows that these measures have not led to increased participation among U.S.-born workers.
Recent labor market trends indicate that restrictions on immigration are also negatively affecting job growth, as fewer available workers limit the potential for new job creation and economic expansion.
Labor economists say the trend undermines claims that deportations and visa limits create openings for Americans. “It’s a fallacy,” Regets wrote. “Immigrants create demand, expand productivity, and complement U.S.-born workers. When they vanish, opportunities for everyone shrink.”
White House Response
White House spokeswoman Abigail Jackson disputed the study’s premise, telling Fortune that “over one in ten young adults in America are neither employed nor in training.” The administration, she said, aims to “tap into that untapped potential” while “enforcing immigration laws that protect American workers.” However, some experts warn that these policies could risk lower economic growth if labor shortages persist.
But independent economists, including analysts at the Congressional Budget Office, caution that deportations and declining visa admissions—affecting both illegal and legal immigration—will exacerbate demographic headwinds. The CBO recently projected that 290,000 immigrants could be removed between 2026 and 2029, tightening labor supply and pushing up wages and prices.
Labor shortages are already impacting key sectors, with educational and health services particularly reliant on immigrant workers and international students to fill critical roles and support innovation.
To address workforce needs, expanding vocational training programs is seen as a vital strategy to equip U.S. workers with the skills necessary to fill jobs traditionally reliant on immigration.
Economic Fallout Across Sectors
Agriculture and Food Production
The Department of Labor recently acknowledged in a Federal Register filing that the immigration crackdown risks a “labor shortage exacerbated by the near-total cessation of the inflow of illegal aliens.” The Trump administration’s immigration crackdown, which included aggressive enforcement actions and restrictions on both legal and illegal immigration, has had a significant impact on the agricultural sector, with the labor department recognizing the risks to food production and farm operations.
Farmers are already reporting shortages. A USDA analysis links shrinking seasonal-worker availability to higher produce prices and delayed harvests, highlighting the negative economic consequences for the sector. Policy measures targeting both legal and illegal immigration in agriculture have further intensified these challenges, reducing the available workforce and threatening the stability of food supply chains.
High-Tech and Innovation
Tech companies such as Amazon, Microsoft, and Meta rely heavily on foreign STEM talent. The new $100,000 H-1B fee—combined with the elimination of OPT—could “choke the innovation pipeline,” said NFAP President Stuart Anderson. Changes in legal immigration policies have a significant impact on the tech sector, affecting the availability of skilled workers and the industry’s ability to remain competitive.
A Brookings Institution study found that foreign STEM workers account for up to 50 percent of productivity growth in U.S. metropolitan areas since 1990, and similar immigration policy changes can also affect industry and food production, where labor shortages can disrupt economic stability. The administration has stated that these policy shifts are part of broader efforts to create jobs for American workers in these critical sectors.
Health Care and Caregiving
Immigrants represent about 25 percent of direct-care workers in nursing homes and home-health agencies, according to the American Immigration Council. Curtailing TPS and refugee programs could deepen shortages that already threaten elder-care capacity. As a result, health care providers may need to heavily recruit workers to fill critical gaps. While some policy advocates argue that we can grow our labor force domestically through increased workforce participation and training, the immediate need for qualified staff remains acute. Economic fallout previous reports have highlighted the risks to health care if labor shortages persist, including reduced access to care and increased strain on existing staff.
Construction, Retail, and Hospitality
These industries, historically dependent on immigrant labor, face severe hiring gaps. Experts have warned Trump’s immigration policies could worsen shortages in these sectors, especially as restrictions such as prohibiting international students further reduce the available workforce. Fewer workers mean project delays, cost overruns, and potentially higher consumer prices, as these policies threaten negative economic consequences for construction, retail, and hospitality.
Broader Fiscal Consequences
A smaller labor force produces fewer taxable wages, shrinking federal and state revenues. NFAP’s model projects that reduced immigration will raise publicly held federal debt by $1.74 trillion by 2035. The NFAP projects an increase in federal debt by $1.74 trillion by 2035 due to the Trump administration’s immigration policies. The Trump administration’s approach to immigration, including policies aimed at restricting both legal and illegal immigration, played a significant role in shaping these fiscal outcomes.
Lower population growth also weakens the solvency of Social Security and Medicare, as fewer workers pay into those systems.
Economists at the Cato Institute note that each 1 percent increase in immigration can lower the debt-to-GDP ratio by several percentage points over a decade—underscoring the fiscal stakes of current policy. The Trump administration’s policies aimed at reducing immigration, such as refugee restrictions and travel bans, had notable fiscal consequences by decreasing labor force participation and slowing GDP growth. The impact of the Trump administration’s immigration policies on economic growth further contributed to these fiscal outcomes, affecting workforce size and broader economic growth projections.
Ripple Effects for Education and Research
The chill extends beyond the labor market. International student enrollment in U.S. universities—long a source of STEM talent—has declined sharply amid uncertainty about work opportunities after graduation. This decline not only affects higher education but also poses a risk to American labor force growth, as international education is a key driver in developing the skilled workforce needed for the future.
“International students are re-evaluating whether the U.S. is still the best option,” said Nan Wu, research director at the AIC. “If they choose Canada or the U.K., the loss to our innovation ecosystem will be enormous, especially given the projected number of workers required to sustain U.S. innovation and competitiveness.”
In 2024 alone, foreign students contributed $40 billion to the U.S. economy, according to the U.S. Department of Commerce, supporting a significant number of workers across education, research, and related industries.
Industry Case Studies
Travel Ban Countries
Households led by recent immigrants from the 19 countries affected by the Trump travel ban generated $3.2 billion in household income and paid $715 million in taxes, the AIC estimated. Restricting those communities removes vital contributors from sectors already facing shortages, including hospitality, retail, and manufacturing, where employers often heavily recruit workers from immigrant populations. Changes in legal immigration policies directly shape these outcomes by influencing the availability of workers and the economic impact of these communities. Policy goals sometimes focus on efforts to grow our labor force through targeted recruitment of U.S.-born workers, but these strategies may not fully address shortages in key industries.
Manufacturing and Small Business
A National Association of Manufacturers report found that immigrant workers fill one in four manufacturing roles requiring technical training. Vocational training programs are increasingly important to help U.S. workers gain the skills needed to fill these positions and address ongoing labor shortages. Losing that talent risks supply-chain disruptions just as the sector struggles with automation and reshoring, and economic fallout previous reports have highlighted the challenges this poses for manufacturing. Additionally, experts have warned trumps immigration policies could disrupt small business growth by reducing access to skilled and unskilled labor.
Economists’ Consensus
Across ideological lines, economists say reducing immigration while the U.S. population ages is economically self-defeating. Many warn that such restrictions threaten negative economic consequences, including labor shortages and reduced economic growth.
A Peterson Institute for International Economics review concluded that immigrants “contribute disproportionately to entrepreneurship, labor-force expansion, and innovation,” adding that restrictive policies, such as the Trump administration’s policies, act “as a self-imposed demographic tax” and carry significant economic risks.
“Every advanced economy is competing for talent,” said Anderson of NFAP. “When the U.S. closes doors, competitors like Canada and Australia reap the gains.” The Trump administration’s immigration policies have played a major role in shaping these economic outcomes, with experts noting their impact on the labor market and overall economic development.
Why Fewer Immigrants Mean Fewer Jobs for Everyone
Contrary to political rhetoric, reducing immigration does not necessarily open jobs for U.S. citizens. Instead, policies targeting illegal immigration can significantly reduce the available workforce, leading to declining demand, lower productivity, and slower job creation.
NFAP’s Mark Regets explains it simply: immigrants are both producers and consumers. Undocumented immigrants, in particular, play a crucial role in supporting employment across various industries. They buy homes, start businesses, and pay taxes—activities that sustain millions of U.S.-born jobs.
An analysis by the National Bureau of Economic Research found that cities with higher immigration inflows experience faster wage and employment growth for native workers over time. Restrictive immigration policies can hinder job growth and limit economic expansion for everyone.
Model Assumptions and Limitations
NFAP calls its estimates “conservative.” The study assumes the 2025 policies persist unchanged through 2035 and does not model all secondary effects, such as reductions in foreign student enrollment or lost productivity from talent flight. The modeling assumptions may also understate the potential to reduce the projected number of workers beyond current estimates.
That means the actual impact could be greater than the projections suggest, potentially affecting the projected number of workers and leading to policies that could further reduce GDP growth beyond current projections.
The organization also notes that economic models cannot fully quantify the “chilling effect” of aggressive enforcement—immigrants deciding not to come, or leaving prematurely due to fear or uncertainty.
What Businesses Can Do
Corporate HR and legal teams are already reassessing their labor strategies to align with the administration’s agenda to create jobs for American workers. Experts recommend:
- Conducting internal workforce audits to identify visa dependencies.
- Exploring global talent hubs (e.g., Toronto, Vancouver, Berlin) as contingency sites.
- Investing in automation and domestic up-skilling programs to create jobs domestically.
- Engaging immigration counsel early to navigate evolving visa regulations.
- Building coalitions with industry associations to advocate for predictable immigration pathways.
As businesses adapt to new immigration policies, it is important to recognize the administration’s commitment to increasing domestic employment and supporting American workers.
For sectors like technology and health care, long-term competitiveness hinges on sustaining access to international labor and expertise.
Legal and Policy Implications
For Employers and HR Teams
Companies will face escalating compliance costs: higher fees, tighter audits, and uncertainty over work-authorization renewals. The labor department plays a key role in monitoring workforce impacts and addressing labor shortages resulting from immigration policy changes. Workforce planning now requires legal foresight, especially for sectors like industry and food production where maintaining productivity is critical. Employers may need to heavily recruit workers to fill gaps left by reduced immigrant inflow.
For Immigration Practitioners
Attorneys must anticipate new constraints on visa programs and help clients mitigate risk. With H-1B, OPT, TPS, and refugee programs in flux, proactive guidance is essential. Legal guidance should also address the growing emphasis on vocational training as a key component of workforce development, equipping U.S. workers with skills to fill roles traditionally reliant on immigration. In adapting to policy changes, attorneys should consider efforts to grow our labor force domestically through employment and training initiatives. Legal strategies must also recognize the administration’s commitment to increasing domestic employment and labor force participation as part of broader economic policy.
For Policymakers
NFAP’s projections highlight an urgent need for data-driven reform. Restrictive immigration policies can reduce GDP growth, as they may limit labor supply and productivity. Economists from the Migration Policy Institute argue that a sustainable U.S. immigration system should align visa supply with demographic and labor-market realities—not political cycles, as workforce reductions threaten lower economic growth. Furthermore, developing policies without considering these factors can threaten negative economic consequences for the broader economy.
The Human Element
Behind the numbers are lives and livelihoods. In cities from Chicago to Houston, immigrants—including undocumented immigrants—work alongside U.S.-born colleagues in construction, caregiving, logistics, and tech, supporting local economies and filling critical labor gaps.
When those workers disappear, communities feel the strain: fewer teachers, fewer caregivers, fewer innovators. The consequences of ending temporary protected status for many individuals can further reduce the workforce and disrupt families and local businesses.
“Immigration is not an abstraction,” said Wu of AIC. “It’s a demographic lifeline. Restrict it too tightly, and the nation’s economic heart starts to falter.” Humanitarian parole programs are also vital, providing protection and hope for vulnerable populations facing urgent crises.
The Road Ahead
If the current trajectory holds, the U.S. could enter the 2030s with its smallest working-age population growth in nearly a century. The projected number of workers needed to sustain economic growth will far exceed what current policies are likely to provide, raising concerns about future labor shortages.
Some economists suggest targeted reforms: reinstating STEM OPT, restoring refugee admissions, and offering legal status to long-term TPS holders. Others call for sector-based visa systems tied to labor demand, while some policy proposals aim to reduce the projected number of workforce reductions through stricter immigration controls.
Whether such measures gain traction will determine whether the U.S. supports American labor force growth and remains the world’s economic powerhouse—or cedes that ground to more immigrant-friendly competitors.
Author Bio / Profile
Richard T. Herman, Esq. is the founding partner of the Herman Legal Group, a nationally recognized immigration law firm, and co-founder of Immigrant, Inc., a platform celebrating immigrant entrepreneurship and innovation. With more than 30 years of practice, Richard has represented corporations, universities, and individuals worldwide on complex immigration matters.
Learn more at the Herman Legal Group, read his attorney bio, or exploreImmigrant, Inc..
Key Takeaways
- NFAP projects 15.7 million fewer workers by 2035 and GDP growth slowing from 1.8% to 1.3%. The Trump administration’s immigration crackdown, with aggressive enforcement policies and restrictions, is a major factor contributing to these projected workforce reductions.
- Immigration accounted for nearly 85% of U.S. labor-force growth (2019-2024); cutting inflows undermines that momentum, with about a million fewer immigrants expected to be in the workforce due to recent policy changes.
- High-skilled visa limits and new fees threaten tech and research sectors.
- Agriculture, health care, and manufacturing face critical worker shortages. The Labor Department admitted earlier that the near total cessation of illegal inflow under these policies risks causing significant labor shortages.
- Federal debt could rise by $1.7 trillion through 2035 as growth slows.
- Economists agree: restricting immigration acts as a self-imposed economic tax.
- Businesses and policymakers must adapt workforce strategies to preserve innovation and competitiveness.
