Immigration Economics: The Taxpayer Impact

A Fair and Balanced Analysis of Jobs, Housing, and Fiscal Costs

Comparing Conservative and Liberal Perspectives with Neutral Data

February 2026

Citizenship Ceremony Source: Wix

Introduction: Understanding the Debate

Immigration policy represents one of the most consequential—and divisive—issues facing American taxpayers today. As the federal government implements unprecedented enforcement measures, understanding the true economic impact requires examining evidence from all perspectives.

This analysis takes a different approach than most immigration reports. Rather than advocating for one position, we present:

• What conservatives argue (and the data they cite)

• What liberals argue (and the data they cite)

• What the neutral evidence shows

• Where both sides agree

Our focus centers on three questions that directly affect your wallet: How do undocumented immigrants impact jobs for American workers? How do they affect housing costs and availability? And what's the net fiscal impact on taxpayers?

A Note on Our Methodology

This report draws exclusively from government data (Congressional Budget Office, Department of Homeland Security, Census Bureau), peer-reviewed academic research, and established think tanks across the political spectrum (American Immigration Council, Peterson Institute, National Immigration Forum, and others). Detailed sources are at the bottom of the page.

We present polling data to show what Americans believe, alongside economic data showing what actually happens. Sometimes these align; sometimes they don't. Understanding both is essential for informed citizenship.

What Americans Believe: The Partisan Divide

Before examining the economic evidence, it's important to understand what Americans across the political spectrum currently believe about immigration's economic effects. Recent polling reveals a stark partisan divide:

Conservative Perspective	Liberal Perspective
57% believe deportation policies will save taxpayers money	83% believe deportation policies will cost taxpayers money
64% believe mass deportation will make the economy stronger	78% believe mass deportation will make the economy weaker
75% believe deportation policies will lead to less crime	Majority believe enforcement diverts resources from real public safety
84% support deporting all undocumented immigrants	Only 22% support deporting all undocumented immigrants
88% favor border wall expansion	Increased support for wall (up from 2019) but still majority opposed
84% support using state/local police for deportation efforts	Majority oppose using local police for federal immigration enforcement

Overall Public Opinion (All Voters):

• 47% of all Americans support deporting all undocumented immigrants

• 46% say Trump's policies will make the economy weaker

• 34% say they will make the economy stronger

• 19% expect no impact

Now let's examine what the economic data actually shows, comparing these beliefs with measurable outcomes.

The Jobs Question: Will Americans Get Those Jobs?

Perhaps no question in the immigration debate generates more heat than this one: If we deport 8.3 million undocumented workers, will American citizens fill those positions? The answer depends on which evidence you prioritize.

The Conservative Case: Opening Jobs for Americans

Conservative economists and policymakers argue that undocumented workers depress wages and take jobs that would otherwise go to American citizens, particularly less-educated workers and those in construction, agriculture, and service industries.

Key Arguments:

1. Basic Supply and Demand: Removing 8.3 million workers from the labor pool should increase wages and create job opportunities for unemployed Americans.

2. Wage Suppression: Employers currently pay lower wages because they can hire undocumented workers who have limited bargaining power. Deportation would force employers to raise wages to attract U.S. workers.

3. Americans Will Do These Jobs at the Right Price: The notion that 'Americans won't do certain jobs' is false—they won't do them at the current suppressed wages. Construction, meatpacking, and agricultural work used to be middle-class careers.

4. Rule of Law: Illegal immigration undermines legal workers and creates an exploitable underclass that benefits corporations at workers' expense.

From this perspective, the 8.3 million jobs currently held by undocumented immigrants represent economic opportunities being denied to American workers, and enforcement is necessary to restore fair labor market competition.

The Liberal Case: Jobs Would Disappear, Not Transfer

Progressive economists counter that mass deportation wouldn't simply transfer jobs to Americans—it would eliminate jobs entirely, causing economic contraction that harms U.S.-born workers.

Key Arguments:

1. Historical Evidence: When deportations happened before (Great Depression, end of Bracero Program), U.S.-born workers didn't get those jobs—they lost jobs as businesses contracted. Arizona's strict 2007 immigration law led to economic decline, not job growth.

2. Complementary, Not Competitive: Research shows immigrant workers and U.S.-born workers typically have different skills and education levels, making them complements rather than substitutes. Immigrants fill gaps that enable businesses to grow and hire more Americans.

3. Economic Multiplier Effects: Every 500,000 immigrants removed causes 44,000 U.S.-born workers to lose jobs as businesses contract, consumer demand drops, and tax revenue falls. Total job loss projection: 5.9 million jobs after 4 years.

4. Labor Market Reality: Unemployment is at historic lows (under 4%). There aren't millions of Americans waiting for these jobs. Construction already has 454,000 unfilled openings and faces a severe skilled labor shortage.

5. Wage Evidence: Studies show immigration actually increased wages for less-educated U.S. workers by 1.7-2.6% between 2000-2019, not decreased them.

From this perspective, mass deportation would trigger an economic recession that hurts everyone, including the American workers it's supposedly designed to help.

What the Neutral Evidence Shows

Let's examine the measurable facts without partisan interpretation:

Current Labor Market Status

3.6-4.0%

Unemployment rate (near historic low)

Undocumented Workforce

8.3 Million

4.4-5.4% of total U.S. workforce

Unfilled Job Openings

282,000+

Current construction openings alone

Industry-Specific Reality

Agriculture: 50-70% of workforce is undocumented (1.2-1.7 million of 2.4 million farmworkers). Already lost 155,000 workers March-July 2025.

Construction: 13.7% undocumented (1.5 million workers). Over 30% of roofers, painters, and plasterers. Already facing 454,000 worker shortage.

Hospitality: 7.1% undocumented (1 million workers). Growth slowed from 1.5% to 0.2% in 2025.

Manufacturing: 870,400 undocumented workers

Transportation: 461,000 undocumented workers

Historical Precedents:

Great Depression (1929-1936): Approximately 400,000 Mexicans departed. Result: U.S.-born employment and wages decreased rather than increased. Businesses contracted rather than hiring Americans.

Bracero Program End (1960s): 500,000 agricultural workers excluded. Result: Agricultural wages didn't rise significantly, but farmers suffered income and land value declines. Farms mechanized or went out of business.

Arizona SB 1070 (2010): Strict enforcement law caused estimated 40,000 undocumented immigrants to leave. Result: State GDP fell by $11.4 billion, didn't create significant new jobs for U.S. workers.

What's Already Happening in 2025:

• California workforce dropped 3.1% (May-June 2025)

• Agriculture lost 155,000 workers (March-July 2025) vs 2.2% increase same period 2024

• Construction employment declining in high-immigration states

• Hospitality growth slowed from 1.5% to 0.2%

Peer-Reviewed Research Findings:

• Economists Giovanni Peri and Alessandro Caiumi found immigration raised wages for less-educated U.S.-born workers by 1.7-2.6% (2000-2019)

• Research shows limited overlap between immigrant and native worker job preferences—they typically seek different types of work

• Peterson Institute projects 5.9 million total job losses from mass deportation (including U.S.-born workers)

The Housing Question: Relief or Crisis?

Housing affordability is crushing middle-class Americans. Could reducing immigration pressure ease this crisis? Or would it make things worse? Again, the answer depends on which side of the equation you examine.

The Conservative Case: Easing Housing Pressure

Conservative analysts point to the housing crisis as a clear area where immigration impacts American families directly. Their argument is straightforward: more people competing for limited housing drives up costs.

Key Arguments:

1. Congressional Budget Office Finding: The CBO identified immigration as creating the 'greatest upward pressure' on housing costs. This isn't speculation—it's the government's official economic analysis.

2. Simple Supply and Demand: America faces a 3.8 million home shortage. Reducing demand by removing 11 million people (undocumented immigrants and their families) would ease competition and lower prices.

3. Rental Market Relief: Undocumented immigrants are concentrated in rental markets where affordability has become critical for working-class Americans. Reduced competition would ease rent pressure.

4. Local Infrastructure Strain: Rapid population growth from immigration outpaces local infrastructure development, particularly in housing. This creates shortages and drives up costs for everyone.

From this perspective, mass deportation would provide immediate housing relief by reducing demand, benefiting American families priced out of homeownership.

The Liberal Case: Would Make Housing Crisis Worse

Progressive economists argue that immigrants are not the cause of the housing crisis but rather part of the solution—and mass deportation would make the shortage far worse.

Key Arguments:

1. Supply Problem, Not Demand: America's housing crisis stems from decades of under-building. We need 3.8 million more homes. The solution is building more homes, not removing people.

2. Construction Workforce Devastation: Undocumented immigrants make up 13.7% of construction workers (1.5 million people), including over 30% of roofers, painters, and plasterers. Mass deportation would cripple home construction when we need it most.

3. Already Severe Labor Shortage: Construction faces a 454,000 worker shortage right now. Losing 1.5 million workers would make building new housing nearly impossible, worsening the shortage.

4. Building Cost Increases: Fewer workers means higher labor costs, making new construction more expensive. This would price even more Americans out of homeownership.

5. Immigrants as Homeowners: Undocumented immigrants inject 'trillions' in housing wealth through homeownership. They're contributors to the housing market, not just consumers.

From this perspective, mass deportation offers short-term demand relief but long-term supply catastrophe, ultimately worsening affordability for everyone.

What the Neutral Evidence Shows

The housing impact involves competing forces—both conservatives and liberals are partially correct:

National Housing Shortage

3.8 Million

Homes needed to meet current demand

Construction Workers at Risk

1.5 Million

Undocumented workers (13.7% of construction workforce)

Current Worker Shortage

454,000+

Unfilled construction positions (before any deportations)

The Housing Paradox

Short-term effect: Reducing population by 11 million would decrease housing demand, potentially easing prices temporarily.

Long-term effect: Losing 1.5 million construction workers (13.7% of workforce) would devastate housing supply, making shortage worse.

Current reality: Construction already cannot meet demand even WITH undocumented workers. Has 454,000 unfilled positions and needs to build 3.8 million homes.

Skilled trades impact: Over 30% of roofers, painters, plasterers, and drywall installers are undocumented. These are specialized skills that cannot be quickly replaced.

Construction Industry Specifics:

Total workforce: 11 million workers

Undocumented workers: 1.5 million (13.7%)

Plasterers/stucco masons: 42% undocumented

Roofers: 38% undocumented

Painters/paperhangers: 33% undocumented

Drywall installers: 30% undocumented

Cement masons: 29% undocumented

What Industry Experts Say:

Construction industry representatives: 'We simply cannot find enough workers now. Losing our current workforce would halt projects across the country.'

National Association of Home Builders: Estimates housing costs would rise significantly, delays would become routine, and many projects would be abandoned.

The Taxpayer Question: Net Cost or Net Benefit?

Here's what taxpayers want to know: Are we paying more for undocumented immigrants than they contribute? And would mass deportation save or cost taxpayers money?

The Conservative Case: Taxpayers Bear the Burden

Conservative fiscal analysts emphasize the costs undocumented immigrants impose on taxpayers, particularly at state and local levels.

Key Arguments:

1. Healthcare Costs: Emergency rooms cannot turn away patients. Taxpayers fund $9-16 billion annually in emergency healthcare for undocumented immigrants who cannot pay.

2. Education Costs: State and local governments spend billions educating children of undocumented immigrants. A 2024 CBO report found local governments raise less in taxes from immigrants than they spend on education and healthcare.

3. Infrastructure Strain: Roads, sewers, schools, and hospitals face increased demand without proportional tax revenue to support expansion.

4. Welfare Programs: While undocumented immigrants cannot directly access most federal benefits, their U.S.-born children can, creating indirect costs.

5. Enforcement Costs: Illegal immigration itself creates enforcement costs—border security, detention, courts—that wouldn't exist with proper border control.

From this perspective, undocumented immigrants consume more in services than they contribute in taxes, making enforcement a fiscal necessity rather than a cost.

The Liberal Case: Net Contributors to Public Finances

Progressive economists argue that undocumented immigrants contribute far more in taxes than they receive in services—and mass deportation would devastate public finances.

Key Arguments:

1. Massive Tax Contributions: Undocumented immigrants paid $96.7 billion in taxes in 2022 ($59.4B federal, $37.3B state/local). That's $8,889 per person—more than many U.S. citizens pay.

2. Programs They Fund But Cannot Use: They contributed $25.7 billion to Social Security and $6.4 billion to Medicare—programs they're ineligible to benefit from. Created $100B Social Security surplus (2004-2014) and $35.1B Medicare surplus (2000-2011).

3. Limited Service Usage: Research shows undocumented immigrants use healthcare less than U.S.-born citizens. They avoid government contact due to deportation fears.

4. Economic Multiplier: Beyond direct taxes, they contribute $299 billion in spending power (2023), supporting businesses and creating jobs for U.S. workers.

5. Deportation Costs Dwarf Any Savings: One-time mass deportation of 11 million: $315 billion minimum. Sustained operations: $88 billion annually. This dwarfs any service costs.

6. Revenue Loss: Deporting 1 million people eliminates $8.9 billion in annual tax revenue. Times 11 million = $97.9 billion annual revenue loss.

From this perspective, undocumented immigrants are net contributors, and mass deportation represents fiscal insanity—spending hundreds of billions to eliminate nearly $100 billion in annual revenue.

What the Neutral Evidence Shows

Let's examine the complete fiscal picture with all costs and contributions:

Annual Tax Contributions

$96.7 Billion

Federal ($59.4B) + State/Local ($37.3B) in 2022

Emergency Healthcare Costs

$9-16 Billion

Annual spending (less than 1% of total Medicaid)

Mass Deportation Cost

$315+ Billion

One-time operation (11 million people minimum estimate)

Complete Fiscal Breakdown

CONTRIBUTIONS (Annual):

• Total taxes paid: $96.7 billion

• Per person average: $8,889

• Social Security contributions: $25.7 billion (ineligible for benefits)

• Medicare contributions: $6.4 billion (ineligible for benefits)

• Consumer spending power: $299 billion

COSTS (Annual):

• Emergency healthcare: $9-16 billion

• Education/local services: Varies by state (CBO: often more than local taxes received)

• Current enforcement: $28.7 billion ICE budget (FY2025)

NET POSITION (Before Enforcement Escalation):

• Best case: $52-59 billion net positive

• Worst case: Break-even or small net cost at state/local level

Mass Deportation Cost Analysis:

One-Time Operation (All 11M):

• Direct costs: $315 billion minimum

• Cost per person: $17,121 (arrest, detention, processing, deportation)

• Lost annual tax revenue: $96.7 billion

• Lost GDP: $1.1-1.7 trillion total

Sustained Operation (1M/year over 10+ years):

• Annual cost: $88 billion

• Total cost: $967.9 billion

• Cumulative revenue loss: $96.7B × years of operation

• Does not include GDP contraction effects

Current Enforcement Expansion (FY2025):

• ICE budget: $28.7 billion (nearly triple FY2024's $3.4B)

• Four-year detention expansion: $45 billion

• ICE agent hiring: $8 billion

• Signing/retention bonuses: $858 million

State/Local Government Impact:

This is where conservatives have their strongest case. A 2024 CBO report found that state and local governments typically receive less in tax revenue from newly arrived immigrants than they spend on education and healthcare services.

However, three important caveats:

1. This applies primarily to 'newly arrived' immigrants. Those here longer contribute progressively more as they integrate economically.

2. Federal government reaps long-term tax benefits (income taxes, payroll taxes), while states/localities bear short-term costs. This is a distribution problem, not necessarily a net cost problem.

3. Even accounting for state/local net costs, the federal enforcement spending vastly exceeds any potential savings.

Side-by-Side Comparison: What $315 Billion Could Buy

The cost of one-time mass deportation ($315 billion) represents a massive commitment of taxpayer resources. To put this in perspective, here's what else America could do with that money:

Alternative Uses for $315 Billion

• Build 40,450 new elementary schools in communities across America

• Construct 2.9 million new homes (nearly solving the housing shortage)

• Provide healthcare coverage for all 27.2 million uninsured Americans for 2+ years

• Fund the entire Department of Education for 3+ years

• Permanently extend ACA subsidies (preventing 3.8 million from losing coverage)

• Repair 315,000 miles of roads or 31,500 bridges

• Fund Social Security for an additional year

• Provide every homeless person in America (~653,000) with $482,000 worth of housing/services

If sustained operations continue at $88 billion annually for 10 years ($880 billion), the comparison becomes even starker. That amount exceeds the entire GDP of many developed nations.

Where Both Sides Agree

Despite the partisan divide, several important areas show bipartisan consensus or at least common ground:

Conservative Perspective	Liberal Perspective
Border security is important and needs improvement	Border security is important and needs improvement
Immigration involves fiscal costs that need to be managed	Immigration involves fiscal costs that need to be managed
State and local governments face short-term strain from immigration	State and local governments face short-term strain from immigration
Some deportations are appropriate (especially violent criminals)	Some deportations are appropriate (especially violent criminals)
Legal immigration system needs reform	Legal immigration system needs reform
Integration and assimilation matter for social cohesion	Integration and assimilation matter for social cohesion

Research Findings Both Sides Should Consider:

A major 2025 study by USC political scientist Morris Levy surveying 20,000+ adults across nine democracies found something remarkable: Support for immigration increases significantly—by up to 15 percentage points among conservatives—when policies include basic integration requirements like employment, language skills, or background checks.

This suggests Americans across the spectrum aren't necessarily opposed to immigration itself, but want assurance that immigrants will integrate successfully. Policy design matters more than partisan messaging.

What 37% of Democratic Voters and Majorities of Republicans Agree On:

• Border security efforts (even Democratic immigrant voters: 37% approval)

• Integration requirements increase support across all political groups

• Employment requirements for immigrants

• Background checks for immigration applicants

Conclusion: What Taxpayers Should Know

After examining evidence from all perspectives, several clear conclusions emerge for taxpayers trying to understand immigration's economic impact:

1. The Net Fiscal Impact Depends on Your Timeframe

Conservatives are correct that state and local governments often face short-term net costs from newly arrived immigrants. Liberals are correct that federal tax contributions far exceed service costs, and long-term economic integration creates net benefits. The distribution mismatch—federal gains vs. state/local costs—is real and needs policy solutions.

2. Jobs Won't Simply Transfer to Americans

With unemployment at historic lows (under 4%), construction facing 454,000 unfilled openings, and agriculture experiencing chronic labor shortages, the idea that 8.3 million Americans are waiting for these jobs contradicts labor market reality. Historical evidence from the Great Depression, Bracero Program end, and Arizona's experience shows deportations decrease rather than increase native employment.

3. Housing Impact Is Paradoxical

Both sides are partially right. Mass deportation would reduce housing demand (conservative point) but would devastate the construction workforce needed to build new housing (liberal point). With a 3.8 million home shortage and construction already facing severe labor shortages, the long-term supply impact likely outweighs any short-term demand relief.

4. Mass Deportation Costs Are Staggering

Whether you believe undocumented immigrants are net contributors or net costs, mass deportation represents an unprecedented fiscal commitment: $315 billion minimum for one-time operations, $88 billion annually for sustained efforts. This dwarfs any potential savings from reduced services, especially considering the $96.7 billion in annual tax revenue that would be eliminated.

5. Economic Contraction Would Hurt Everyone

A 4.2-6.8% GDP contraction (worse than the Great Recession's 4.3%) would mean job losses for U.S.-born workers (projected 5.9 million over 4 years), price increases (10% food costs, 9.1% overall inflation), and business failures across industries. This isn't speculation—it's already beginning in 2025 with California workforce declines and agricultural labor losses.

6. This Isn't Just About Economics

While this report focuses on fiscal and economic impacts, immigration policy involves moral, social, and legal dimensions that economic data alone cannot answer. Families will be separated. Communities will change. These human costs and benefits exist alongside the economic calculations.

The Bottom Line for Taxpayers

Current Status: Undocumented immigrants contribute approximately $96.7 billion annually in taxes while receiving an estimated $9-16 billion in emergency services—a net positive contribution of $52-59 billion at the federal level, with state/local governments facing net costs in many cases.

Mass Deportation Impact: Would cost $315+ billion for one-time operations or $88 billion annually for sustained efforts, eliminate $96.7 billion in annual tax revenue, trigger 4.2-6.8% GDP contraction, cause 5.9 million job losses, and worsen housing shortage by removing 13.7% of construction workforce.

Labor Market Reality: With unemployment under 4% and 454,000+ unfilled construction positions, historical evidence shows deportations decrease rather than increase native employment and wages.

Policy Alternatives: The $315 billion cost of mass deportation could fund 2.9 million new homes, cover all uninsured Americans for 2+ years, or address countless other pressing needs.

As taxpayers, you deserve policies based on evidence rather than assumptions.

This report provides the data. The policy choices remain with voters and elected officials.

Appendix: Sources and Methodology

This report synthesizes data from the following sources:

Government Sources:

• Congressional Budget Office (CBO) reports on immigration fiscal impacts

• Department of Homeland Security budget documents and operational data

• U.S. Census Bureau American Community Survey data

• Bureau of Labor Statistics employment and wage data

• ICE operational reports and detention statistics

Research Institutions:

• Peterson Institute for International Economics

• American Immigration Council

• National Immigration Forum

• Center for American Progress

• George W. Bush Presidential Center

• Johns Hopkins Carey Business School

Polling Organizations:

• Pew Research Center

• KFF (Kaiser Family Foundation)

• Data for Progress

Academic Research:

• Giovanni Peri & Alessandro Caiumi (wage impact studies)

• Morris Levy, USC (immigration policy design research)

• Various peer-reviewed economic journals

Methodology Notes:

• All dollar figures adjusted for inflation where necessary

• Ranges provided when sources differ or uncertainty exists

• Conservative estimates used for cost projections (actual costs likely higher)

• Both partisan perspectives presented with their strongest supporting evidence

• Neutral analysis focuses on verifiable data points with broad expert consensus

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