Trump’s mass deportation plan could have a big effect on inflation

The United States has seen cool inflation in 2024, but economists warn that President-elect Donald Trump’s plan for the mass deportation of undocumented immigrants could greatly affect prices.

“Certainly, the economic impacts are felt,” said David J. Bier, the director of immigration studies at the Cato Institute. “There will be supply chain problems. There will be increases in prices, decreases in services.”

Experts are concerned that deporting such a large number of undocumented immigrants at once could leave a hole in the workforce. A 2023 study in the Journal of Labor Economics found that 44,000 US-born workers could lose their jobs for every 500,000 immigrants removed from the labor force.

“Immigrants, especially unauthorized immigrants, are much more likely to work in the types of jobs that create the goods and services where we see prices rise,” said Chloe East, a research associate at the National Office of Economic Research who was also one of the researchers behind the 2023 study.

“We can’t say for sure what the effects will be,” he said. “But based on what we know from past mass deportation efforts, it appears that goods and services where unauthorized immigrants are highly concentrated such as construction and agriculture, prices are likely to rise because of a mass deportation effort rather than declining.”

Look at the video above to find out what other economic effects mass deportation could impose on the United States