American authorities believe that there are around 11 million undocumented immigrants in the country, the vast majority from Mexico, and that 8.3 million of them are working. That’s 5 percent of the workforce.
– Today our cities are overflowing with illegal foreigners. Americans are being pushed out of the workforce and their jobs are being taken away from them, Trump said during the election campaign earlier this year.
But the reality is much more complex, and many of the sectors that would be hardest hit, such as construction and agriculture, have long struggled to attract American workers.
– The construction and agricultural sectors would lose one in eight employees, and in the hotel and restaurant industry one in 14 employees would be deported, according to a report by the American Immigration Council.
They estimate that deporting just one million undocumented immigrants could cost upwards of $88 trillion annually, rising to $967.9 trillion over ten years. This corresponds to almost NOK 1,000 billion annually. That’s what ABC writes.
A mass deportation would also affect 30 percent of the bricklayers, roofers and painters and about a quarter of the cleaners in American homes.
Reduced GDP
A recent study by the American Enterprise Institute, the Brookings Institution and the Niskanen Center found that Trump’s plans could reduce US annual GDP in 2025 by as much as 0.4 percentage points, if 3.2 million people are deported during his term.
The most important impact on growth would be the direct effect of fewer people producing goods and services, but it would also mean that there would be fewer consumers.
In a more extreme scenario, which the analysts believe is unlikely, the effect on growth would be far higher.
If 8.3 million undocumented foreigners are deported, the growth until 2028 could be 7.4 percent below the calculations, which, according to the Peterson Institute, would mean that there would be no growth whatsoever during Trump’s four years as president.
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Inflation may increase
At the same time, inflation would be 3.5 percentage points higher in 2026 than otherwise because wages had to be increased to attract American workers.
But even in a less extreme scenario, mass deportations could push prices up.
– Trump’s plans for deportation could lead to high price increases in certain sectors, but also to inflation in general, says Michael Strain of the American Enterprise Institute.
Nevertheless, it is not certain that the impact on inflation would be so strong, since increased prices in the construction and agricultural sectors would be offset by weaker consumption in general and lower price increases in, for example, the housing sector, according to Pantheon Macroeconomics.
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Doubt that anything will happen
However, many experts expect legal, logistical and financial challenges to slow down Trump’s most extreme plans.
It happened in his first term, and in that case it would only mean that immigration will be somewhat lower than before the pandemic.
– We are skeptical that deportation on such a scale as was talked about in the election campaign will actually happen, says chief economist Ryan Sweet at Oxford Economics.
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