SACRAMENTO, June 17, 2025
Mass deportations Could Cost California Billions
A new study reveals the economic impact of removing undocumented workers from California, potentially devastating key industries.
- Mass deportations could cost California $275 billion.
- The state would lose $23 billion annually in tax revenue.
- Key industries like agriculture and construction would be severely impacted.
California’s economy relies heavily on undocumented labor. Mass deporting these residents would create a $275 billion deficit and cripple numerous industries. This is according to a study released June 17, supported by the California Health Care Foundation, which provides a stark warning about the economic consequences of increased immigration enforcement.
Immigrants are tightly integrated into California’s economy, working millions of essential jobs and contributing extensively to the state’s $4.1 trillion economy, the fourth-largest in the world. The study arrives as the federal government intensifies immigration enforcement.
Key findings of the study include the estimate that about 1.5 million undocumented residents make up 8% of California’s workforce. Mass deportations would cost the state an estimated $275 billion in wages and other direct and indirect economic activity. The average undocumented immigrant in California pays $7,000 in taxes. The loss of tax revenue from mass deportations would cost state,local and federal budgets a combined $23 billion annually,potentially impacting funds for a range of public services.About 40% of California’s small businesses are owned by immigrants; nearly 11% of those are owned by undocumented immigrants. These small businesses generate local taxes, help lease commercial units, and create contracts for local distributors, and cater to a community’s specific needs. Geographic regions with higher proportions of undocumented residents, including the San Joaquin Valley, San Francisco Bay area, Inland empire and Los Angeles, would experience the worst impacts. Based on wages alone, undocumented workers generate 5% of the state’s overall economic activity, a figure that rises to 9% when the ripple effects of their spending and other contributions are factored in.
Economic Multiplier Effect: Every dollar earned by workers is re-spent in the local economy, creating a ripple effect that boosts overall economic activity. This study highlights the notable impact of undocumented workers’ spending.
The research involved in-depth interviews with nearly 40 people, including business leaders and community organizers. These interviews provided crucial context, highlighting the real-world impacts of stricter immigration policies.
“California has a long and rich history of embracing immigrants and the many valuable contributions they bring to our state, economically, culturally and in so many other ways,” saeid Maria-Elena De trinidad Young, UC Merced public health professor.”Understanding how increased immigration enforcement is affecting such a large swath of our population is critical to addressing the fears many in the immigrant community are experiencing and informing how we plan for not only economic and fiscal impacts but the human impacts.”
Four UC Merced students contributed to the study by conducting interviews and analyzing transcripts.Graduate students Sarina Rodriguez, Sharon Tafolla and Fabiola Perez-Lua, and undergraduate student Samantha Valle Meraz, helped provide valuable insights.
“This report is so impactful because it combines the best of both worlds of research,” Rodriguez said. “Our partner’s economic analysis is complemented by our qualitative interviews that document what is happening right now on the ground and what policy changes California’s community and business leaders need to protect our state’s immigrant communities.”
Voices of the Future: The involvement of UC Merced students in this study underscores the importance of engaging the next generation in understanding and addressing complex social and economic issues.
Interviewees emphasized the extensive experience and vital skills these workers bring to essential roles. These include everything from growing and preparing food to caring for children and the elderly.
Certain industries and regions would be disproportionately affected by mass deportations. As the nation’s leading agricultural producer, California heavily relies on immigrant labor, with 63% of the agricultural sector being immigrants and almost 26% undocumented. in construction, immigrants make up 41% of the workforce, with 14% being undocumented.
Sector Vulnerability: The agricultural and construction sectors face significant disruption due to their high reliance on immigrant labor. Mass deportations could lead to labor shortages and increased costs.
“Immigrants,both documented and undocumented,are deeply and intricately woven into our overall economic fabric,” said Abby Raisz,research director for the bay Area Council economic Institute. “The impact of losing 8% of California’s workforce would have a crippling effect on the state economy. The impacts would extend far beyond California’s borders, with labor shortages contributing to higher food prices nationwide.”
Nearly half of California’s undocumented population has lived in the state for 20 years or more, bringing considerable experience to their jobs, even in roles often categorized as “low-skilled.” The study also revealed broad support in the business community for complete federal immigration reform.
Beyond the Billions: The Human Cost of Deportation
The economic repercussions of mass deportations, as highlighted in the recent study, are just one facet of a broader, more complex reality. Beyond the $275 billion deficit, there are notable human impacts, affecting families, communities, and the very fabric of california society.The loss of 1.5 million workers isn’t just a statistic; it represents a loss of skills, experience, and the contributions of individuals who have built lives and families in the state.
The emotional and societal toll of removing parents, workers, and neighbors is immense. Increased immigration enforcement can lead to the separation of families, leaving children without caregivers and spouses without partners. Imagine the emotional distress for families facing this uncertainty, knowing that a loved one could be detained or deported at any moment.
The study from UC Merced, which has added to the narrative surrounding the economic impact of mass deportations on California, emphasizes the importance of understanding these effects. Furthermore,the interviews with community organizers and business leaders highlighted the human cost.
The ripple effects extend beyond the immediate families of those deported. Communities suffer the loss of vital members, and essential support networks are damaged.This loss can affect schools, places of worship, and local businesses.
What are the consequences of mass deportations on families? Families face separation, emotional distress, and economic hardship when a family member is deported.
How does deportation impact communities? Deportations can lead to a loss of community members,disruption in local support networks,and decreased social cohesion.
To understand how to begin to combat the real issues surrounding mass deportations,look at the potential and the actual benefits of the contributions made by undocumented immigrants. The study found that undocumented immigrants pay an average of $7,000 in taxes per year, contributing to the state, local, and federal budgets.They create jobs and stimulate the economy through spending. They also help to support social security and medicare through their taxes.
The recent study emphasizes the importance of immigration reform and its role in protecting the welfare of immigrants. It is critical to protect their jobs, housing, and, most of all, their families. Maria-Elena De Trinidad Young from UC Merced shared that “Understanding how increased immigration enforcement is affecting such a large swath of our population is critical to addressing the fears manny in the immigrant community are experiencing and informing how we plan for not only economic and fiscal impacts but the human impacts.”
Call to Action: Consider supporting organizations that advocate for immigrant rights and provide resources to help families navigate the challenges of immigration enforcement.
Undocumented immigrants are integral to California’s cultural landscape. They contribute to our state’s cultural, economic and social vibrancy. They enrich our communities by sharing their traditions,languages,and perspectives. Without the cultural contributions of immigrants, California would not be the dynamic and diverse place it is today.
The potential for widespread deportations creates fear and uncertainty in immigrant communities across the state. This impacts the mental health and overall well-being of individuals. The mental health of those in the immigrant communities is also significantly affected. Limited access to resources, and the trauma of separation and family are just a few of the things at play hear.
Moreover, the fear of deportation can lead to a reluctance among immigrants to report crimes, seek medical care, or engage in civic activities, undermining public safety and the overall health of our communities. The climate of fear also negatively impacts the contributions of immigrants to our economy.
