After predictions that President Donald Trump’s mass deportation plans could harm the U.S. economy, signs are emerging that some industries are starting to feel the impact. Wholesale vegetable prices are rising, and sectors that rely heavily on immigrant labor are experiencing slowdowns.
Economic data suggest that the administration’s immigration policies, combined with tariffs, may be contributing to higher costs and slower growth in certain industries.
According to the Bureau of Labor Statistics, wholesale prices for dry and fresh vegetables jumped 38.9% from June to July, marking the largest increase since March 2022.
Phil Kafarakis, president of IMFA The Food Away From Home Association, which represents food producers, suppliers, and services outside grocery stores, warned that these signs should be taken seriously.
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,” he said. He added that this is worsening the already “horribly, incredibly impactful” effect of tariffs.
Combined with droughts, flooding, and wildfires, deportations are expected to create even bigger problems for late summer and early fall harvests, Kafarakis noted.
“I don’t think people realize” that vegetable prices will rise in restaurants, grocery stores, and other outlets, he said.
While the administration has not yet reached the deportation levels Trump promised during his campaign, Immigration and Customs Enforcement made its highest monthly arrests in at least five years in June.
This week, the Dallas Federal Reserve reported that Texas’ economy has slowed amid uncertainty. Business owners told the Fed that unclear immigration policies and tariffs were creating challenges for hiring and investment.
“Immigration enforcement actions are also affecting the ability of some firms to recruit and retain workers,” the report stated.
The Federal Reserve surveys Texas businesses regularly. In its July survey, it found that the inability to hire qualified workers due to lack of legal status was the most common challenge among firms experiencing workforce disruptions.
The report included a quote from a machine manufacturer: “Foreign-born laborers get the job done. We need them, we use them, and we like them.”
Immigrant labor makes up a large part of Texas’ workforce. An April report by the Dallas Federal Reserve found that the share of Texas firms relying on immigrant workers increased from 15% in 2023 to 25% in 2024.
“The increase has been across all sectors, with about one-third of manufacturing respondents relying on immigrant workers,” the report said.
A report by America’s Voice highlighted that immigration restrictions are reducing the inflow of new workers, causing a shortage.
“The country is losing workers without them being replaced, with adverse economic consequences,” the report said. The authors include Robert Lynch, Michael Ettlinger, and Emma Sifre.
Lynch noted that from March to July in 2023 and 2024, employment in agriculture and related industries grew. But this year, during the same period, the number of workers dropped by 155,000, a 6.5% decline.
In construction, the 10 states with the most unauthorized workers saw employment drop 0.1% from June 2024 to June 2025, while other states grew 1.9%. Growth in those other states was also lower than a year ago, down from 2.3%.
About 7% of leisure and hospitality workers are undocumented, mainly in restaurants and hotels. States with higher concentrations of unauthorized workers are experiencing slower growth in these sectors. Food service employment grew only 0.2% in high-immigrant states compared to 1.5% in others.
“A loss of a significant portion of this workforce is likely to be particularly damaging, as there were nearly 1 million unfilled jobs in leisure and hospitality as recently as April of this year,” Lynch said.
The total number of foreign-born workers in the U.S. fell from 33.3 million in January to 32.1 million in July—a loss of about 1.2 million, according to analysis by the National Foundation for American Policy.
Stuart Anderson, the foundation’s executive director, said that labor participation among U.S. workers has not risen to fill the gap.
“The reason why you see slowdowns is because when employers can’t find enough workers, they are going to invest less,” he said.
Antonio De Loera-Burst, a spokesman for United Farm Workers, questioned whether there is truly a labor shortage in agriculture. He said workers are afraid and acknowledged that raids have occurred.
“But a lot of workers I talk to are desperate for work. There’s not enough work,” De Loera-Burst said. He added that hours are being cut and workers are being asked to do in six hours what they used to do in eight.
“We are dead set against deportations,” he said, referring to UFW.
De Loera-Burst claimed that growers are using immigration raids as an excuse to push for more guest workers at lower pay.
President Trump has faced pressure from industries relying on immigrant labor, especially agriculture, to maintain a stable workforce. He initially paused arrests in agriculture and hospitality, then resumed them, and is now considering temporary work passes for certain workers.
