Summary
This report examines how shifting federal immigration enforcement policies and expanded immigration enforcement could impact California’s economy. With the nation’s largest state economy where immigrants comprise nearly one-third of the population, disruptions in California would reverberate nationwide. Drawing on economic data and stakeholder perspectives, the study analyzes the role undocumented immigrants play in the state and the potential consequences of mass deportation policies.
Findings: Authors find losing its immigrant workforce from deportation affects the state’s tax base and GDP and disrupt agriculture and construction industries.
Losing the immigrant workforce would reduce California’s GDP and tax revenue:
- Of California’s 10.6 million immigrants, 2.28 million are undocumented – representing one in five immigrants and 8% of all workers in California. Based on direct wage contributions alone, undocumented workers generate nearly 5% of California’s gross domestic product (GDP) – a figure that rises to nearly 9% when accounting for the broader ripple effects of their labor across the economy.
- Undocumented workers also contribute over $23 billion annually in local, state, and federal taxes.
Mass deportation would particularly disrupt agriculture and construction industries:
- Over a quarter of the state’s agricultural workforce is undocumented, and nearly two-thirds are immigrants of any status. Without undocumented workers, GDP generated by California’s agriculture industry would contract by 14%.
- A mass deportation policy would also severely disrupt California’s construction industry, which already faces a major labor shortage and relies heavily on immigrant workers – 26% of whom are undocumented and 61% of whom are immigrants. Without undocumented workers, GDP generated by California’s construction industry would shrink by nearly 16%.