For the first time since the COVID-19 years, the number of immigrants in the United States has declined.
Aggressive immigration policies have led to 1.4 million fewer immigrants in the country between January and May alone. This number includes 750,000 workers. Historically, mass immigrant exoduses and outright removals far below this scale left lasting harm on communities and local economies.
“We are in a period in which the American labor force is shrinking, which adds another reason for thinking that these deportations will generate even more hurdles for the growth of companies and more restriction on the growth of the U.S. economy,” said Giovanni Peri, director of the UC Davis Global Migration Center and professor of economics in the College of Letters and Science.
The sudden drop in the number of immigrants in the U.S. also comes at a time when fertility rates among the native-born population are also falling. Peri’s research suggests that these two trends could tip a precarious economy into decline.
Returns to Mexico lowered jobs and wages during the Great Depression
During the Great Depression, between 1929 and 1934, at least 400,000 immigrants returned to Mexico. This number represented roughly one-third of the Mexican population in the U.S. at that time.
Peri said that the departures were only partly voluntary and had to do with a hostile environment and negative government incentives. Government policies at the local, state and federal levels to promote departures were explicitly for the purpose of creating jobs for the native-born.
The sharp reduction in Mexican immigrants actually made it less likely a native-born worker would find a job. Average wages also went down slightly. These effects were stronger in cities than in rural areas.
The main cause was that companies in sectors like construction, agriculture and manufacturing lost their labor force and left the area. Jobs for supervisors, managers, skilled and technical workers, which all tended to go to the native-born, went with them.
Additionally, fewer workers in the area also reduced demand for the businesses that served them. These could be restaurants or grocery stores that suddenly had fewer customers and less need to hire as a result.
“In places where more Mexicans left, there were fewer companies and fewer jobs, and in the longer-run those communities were worse off,” said Peri.
Japanese internment and U.S. agricultural decline 20 years later
During World War II, the U.S. government forced the relocation of around 110,000 Japanese Americans from communities in the West Coast exclusion zone to internment camps. This included 22,000 agricultural workers, and the majority of them never farmed again.
“Japanese people working in agriculture were skilled, they were more literate and they were adopting newer and more efficient technologies than native-born farmers,” said Peri.
The impacts of this mass internment would be felt decades later in the West Coast communities most affected by the removals.
By 1960, counties within the exclusion zone had 12% lower overall growth in farm value for each percentage-point reduction in their share of Japanese farm workers two decades earlier. These counties also had lower farm revenues, lower adoption of high-value crops, lower rates of mechanization and lower adoption of commercial fertilizer.
These effects might also have stunted economic growth outside of agriculture.
Increasing both deportations and unsolved local crimes
While deportations are most closely identified with the current U.S. President, they also peaked during the Obama administration. Between 2000 and 2012, deportations increased sharply to roughly 400,000 in 2012.
The deportations had an unexpected effect on crime: deportations went up, but so did unsolved local crimes.
Increasing deportations reduced the police clearance ratio, which is the share of crimes that police solve. Because the additional deportations included enlisting local police to cooperate with immigration authorities, they had less time to address local crime.
While immigration has been labeled a cause of higher rates of crime, research finds this is not true. A separate economic analysis by UC Davis economist Santiago Pérez showed that over the past 100 years, incarceration rates for immigrantshave been lower than for people born in the U.S.
History may repeat with aggressive immigration policies today
Peri is most widely known for his research that shows immigrant workers fill roles in the labor market that complement native-born workers. They may even increase total jobs and pay.
“Instead of generating more competition across the board, immigrant workers have almost always increased overall economic opportunity for everyone,” said Peri.
Peri said that there are clear structural similarities between the U.S. economy during these moments in history and our current time. In 1939, for example, Mexican workers disproportionately worked in agriculture, manufacturing and construction.
In 2022, 55% of farm laborers were of Mexican origin. The largest share of hired farm workers over the last two decades have been in the U.S. without authorization.
The decline in fertility rates in the U.S. is also part of a steady downward trend since 2007. In 2024, the Congressional Budget Office projected that without immigration, the U.S. population would shrink after 2033.
The first years of the COVID-19 pandemic offer a glimpse of what might result from today’s mass deportations. Between 2020 and 2021, the number of immigrants arriving in the country collapsed. Jobs that would otherwise have been filled by immigrants were left open. In 2023, Peri found that native-born workers did not relocate to fill those jobs.
This double-blow of both declining birth rates and aggressive immigration policy could hobble the U.S. economy in the long-term.
“There are real economic consequences from deportations that we'll need to think about,” said Peri. “This is a cost that we will need to decide we want to pay.”