Tariffs and deportations are being viewed as factors that contribute to higher prices and a shortage of immigrant workers. More like this

After concerns that President Donald Trump’s mass deportations could hurt the American economy, we’re now witnessing a spike in wholesale vegetable prices and slowdowns in sectors that depend on immigrant labor. Recent economic reports are leading some to suggest that the administration’s tough stance on immigration, along with tariffs, is at least partially to blame for the downturn in certain industries and the rising costs. The latest data from the Bureau of Labor Statistics revealed a staggering 38.9% increase in wholesale prices for dry and fresh vegetables from June to July, marking the largest jump since March 2022. Phil Kafarakis, president of IMFA The Food Away From Home Association, which represents food producers, suppliers, and services outside of grocery stores, emphasized that these warning signs shouldn’t be ignored. He pointed out that due to deportation efforts, “you are now going to be left with not enough laborers in the fields to pick up and collect product as it’s coming to harvest,” adding that this is contributing to the current “horribly, incredibly impactful” effects of tariffs. With challenges like drought, excessive flooding, and wildfires, the impact of deportations is becoming more pronounced and could lead to bigger issues during the late summer and early fall harvests, he noted. “I don’t think people realize” that there will be a surge in vegetable prices at restaurants, grocery stores, and other venues, Kafarakis warned. While the administration hasn’t yet reached the deportation levels Trump promised during his campaign, June saw the highest number of arrests by Immigration and Customs Enforcement in at least five years. This week, the Dallas Federal Reserve released a report indicating that Texas’ economy has softened amid ongoing uncertainty. Business owners shared with the Dallas Federal Reserve that worries about tariffs and immigration policy are creating hurdles for investment and hiring. Immigration enforcement actions are impacting some companies' ability to find and keep workers,” the agency pointed out in its report. The federal bank regularly surveys businesses in Texas. In its July survey, it found that the biggest challenge for firms facing workforce disruptions was the difficulty in hiring qualified workers due to a lack of permits or legal status. The report included a quote from a machine manufacturer who responded to the survey, saying, “Foreign-born laborers get the job done. We need them, we use them, and we appreciate them.” Immigrant workers play a significant role in Texas' workforce. According to an April report from the Dallas Federal Reserve Bank, the percentage of Texas firms that rely on workers who have moved from other countries rose from 15% in 2023 to 25% in 2024. "The increase has been seen across all sectors, with about one-third of manufacturing respondents depending on immigrant workers," the bank noted at that time. In a report released Thursday by the immigrant advocacy group America’s Voice, the authors highlighted that the flow of immigrant workers in and out of the country has slowed down, primarily due to border restrictions limiting the influx of immigrants. “The country is losing workers without them being replaced, which has negative economic effects,” states the report by Robert Lynch, Michael Ettlinger, and Emma Sifre. Lynch is an economics professor at Washington College, Ettlinger is a founding director of the University of New Hampshire's Carsey School of Public Policy, and Sifre is a data analyst at the Institute on Taxation and Economic Policy. Lynch mentioned that the number of workers in agriculture and related industries grew from March to July in 2023 and continued into 2024. However, employment in those same industries saw a drop of 155,000 workers during those months this year, a decline of 6.5%. In the construction industry, the ten states with the highest number of unauthorized workers experienced a slight employment dip of 0.1% from June 2024 to June 2025. In contrast, other states enjoyed a 1.9% increase during the same period, as highlighted in the report. Moreover, growth in states outside the top ten has slowed compared to last year, dropping from a 2.3% growth rate. According to Lynch, around 7% of workers in the leisure and hospitality sector are undocumented, primarily concentrated in restaurants and hotels. He noted that states with a higher number of unauthorized workers are seeing slower growth in this sector. The report also indicates that food service employment in states with a significant immigrant population grew by just 0.2% over the past year, while other states saw a more robust growth of 1.5%. Lynch pointed out that losing a substantial part of this workforce could be particularly harmful, especially since there were nearly 1 million unfilled positions in leisure and hospitality as recently as April this year. Analysis from the National Foundation for American Policy, a trade and immigration research group, reveals that the number of foreign-born workers in the U.S. dropped from 33.3 million in January to about 32.1 million in July, a decrease of roughly 1.2 million workers, based on Bureau of Labor Statistics data. Stuart Anderson, the foundation's executive director, noted that there hasn't been a corresponding rise in labor participation among U.S. workers. He explained, “The reason for the slowdowns is that when employers struggle to find enough workers, they tend to invest less.” Antonio De Loera-Burst, a spokesman for United Farm Workers, raised doubts about the existence of genuine labor shortages in agriculture. He mentioned that many workers are scared, acknowledging that raids have taken place in some agricultural fields and related worksites. However, De Loera-Burst added, “Many workers I speak with are desperate for jobs. There simply isn’t enough work.” He pointed out that hours are being reduced, and workers are being asked to accomplish in six hours what they used to do in eight. “We are firmly opposed to deportations,” he stated, referring to the UFW. He mentioned that it seems like growers are taking advantage of the disruptions caused by immigration raids on their businesses, using it as their latest excuse to push Congress for their long-standing goal: bringing in more guest workers and paying them less. Trump is facing pressure from businesses that depend on immigrant labor, especially in the agricultural sector, to make sure they have a stable and dependable workforce. His approach to handling this situation has changed over time. At first, he put a hold on arrests of workers in agriculture and hospitality, then he resumed the raids, and now he’s even talking about possibly creating temporary permits for certain workers.

NEWS