The Economics of Mass Deportation

[Note: I prefer not to bicker over the terms, illegal immigrant and undocumented immigrant. U.S. Immigration and Customs Enforcement (ICE) refers to a person in violation of U.S. immigration law as a noncitizen. I will, too.]

Best estimates put the population of U.S. noncitizens at roughly 11 million. 8.3 million noncitizens constitute 5% of the U.S. labor force. A proposal to deport all 11 million in one or a few fell swoops is on the table. Let’s consider the economics of mass deportation.

First, the direct costs of deporting 11 million noncitizens. Each one must be caught, arrested, detained, legally processed and removed. The branch of U.S. Immigration and Customs Enforcement (ICE) tasked with catching, arresting, detaining and removing is Enforcement and Removal Operations (ERO). ERO consists of 7,600 law enforcement and non-law enforcement support personnel. It deployed 1,300 of its workers to the Southwest border for much of FY 2023. Even so, ERO made 170,590 arrests of noncitizens in FY 2023. It has the capacity to detain up to 30,000 people at any given time. On average, a noncitizen is detained for 37.5 days while their case is legally processed. Legal processing is handled by the Office of Principal Legal Advisor (OPLA). OPLA consists of 1,750 attorneys and support staff, which leaves it understaffed by 667. Nevertheless, ERO removed 142,580 noncitizens to more than 180 countries in FY2023.

One wonders what it would cost to build and operate the hundreds of additional detention facilities, and hire, train and pay the tens of thousands of additional ERO and OPLA personnel necessary to make mass deportation viable.

Next, the indirect costs. The working, spending, tax paying, investing and entrepreneurship of noncitizens generates $1 trillion a year in real GDP and $100 billion a year in federal, state and local taxes paid. Deporting the 11 million would mean deporting $1 trillion a year in production and $100 billion a year in tax revenues each and every year they’re gone.

Deporting the 11 million would also destroy jobs for U.S. born workers, perhaps as many as 730,400. The figure comes from a 2023 study on the labor market effects of U.S. deportations in 2005-2014. The study finds that for every 500,000 noncitizen workers deported in 2005-2014, 44,000 U.S. born workers lost their jobs. The reason is clear. Many noncitizens will do jobs U.S. born workers won’t. The jobs are vital to production: if they can be filled, a business is launched. The business fills other jobs with U.S. born workers. Remove the vital workers, the business shuts down.

The 8.3 million noncitizens in the U.S. labor force are heavily concentrated in agriculture, food processing, hospitality and especially construction. Noncitizens do vital jobs in each, especially construction. Noncitizens also own and manage businesses in each, especially construction.

Jack Herrera describes the ramifications for Texas in the November issue of Texas Monthly. The Texas economy has been soaring since 2000, a classic business boom, population boom, construction boom combo, with one dreaded vulnerability. In Texas, says Herrera, “Cutting off the supply of undocumented workers would be like cutting off the supply of concrete and lumber.”

Texas business folk instruct Texas politicians, frequently and with urgency: if the border closes, the boom crashes. The politicians get it. They satisfy the base with plenty of “the border’s a disaster” rhetoric. Meanwhile, builders build, uninterrupted. With open gates, mass deportation is futile. The U.S. has a serious housing problem. Hurricanes happen, too. The effort to deport one-fifth of the country’s construction workers may commence in three months. Who builds the new deportation detention facilities is the rub.