During Trump's 2024 presidential campaign, he relentlessly emphasized border security, enforcement, and crimes committed by illegal immigrants. It does not matter that Biden was actually quite strict on immigration or that illegal immigrants are much less likely to commit crimes. Immigration ended up being one of the main issues that catapulted Trump into a second term. It even resonated enough with the Latino community that 48 percent of Latinos voted for Trump in 2024. Not only are more Americans in support of reduced immigration to this country, but Trump's idea of mass deportation has become more popular. Last decade 37 percent of Americans supported mass deportation. As of last year, that climbed to 47 percent, with 84 percent of Republicans being on board (Gallup).
While mass deportation is becoming increasingly popular, there are real-world implications that are not neatly captured in campaign slogans. Before embracing or rejecting mass deportation, we should look to what the data have to say about economic and fiscal implications. The Wharton School of Business, which is the premier business school, did exactly that in a policy brief it released late last month.
This report presents two possible scenarios. The first is a four-year policy in which unauthorized immigration returns to baseline levels in 2029, after Trump's current presidential term. The second scenario assumes that all unauthorized immigrants will be removed from the United States by 2034. This paper gets into a few of the fiscal and economic implications that go beyond the generic "GDP will decline." Unsurprisingly, the second scenario has larger outcomes because it costs more to implement a policy that removes all unauthorized workers.
One of the more interesting implications is that of wages of those in the U.S. labor market. The report distinguishes between high-skilled labor (which accounts for 63% of the working force) and low-skilled labor. In both scenarios, high-skilled labor experiences a decline in wages. That decrease would be an average decrease of $494 per year in the first scenario and $2,764 in the second scenario.
It ends up a bit different for low-skilled workers. In the first scenario, low-skilled wages increase by 1.1 percent in 2034 and fall by 0.6 percent in 2054. It is in the second scenario where low-skilled labor experiences true increases. This means that low-skilled workers can experience a decrease in lifetime earnings of $8,600 (four-year policy) or a gain of $63,600 (10-year policy), depending on which policy takes in effect.
Then there are the other effects of the deportation. The four-year scenario is expected to increase the budget deficit by $350 billion and reduce the GDP by 1.0 percent by 2034. In contrast, the ten-year scenario is expected to increase the budget deficit by $987 billion and reduce the GDP by 3.3 percent by 2034.
While the 10-year plan makes for flashier headlines, it is also the less likely of the two. Being able to remove all unauthorized workers is unfeasible, and I do not simply say that because it has not been done in the past. Think about all the enforcement, detention, legal proceedings, and transportation that it would take to remove 11 million people from the United States. The legal, economic, and social blowback would be tremendous. While more difficult, the four-year plan is more feasible than the ten-year plan.
Regardless of which scenario plays out, this study concludes that mass deportation policies harm the greater U.S. economy, reduce overall average wages, and increase federal deficits. The only way that low-skilled workers benefit from mass deportation is if the U.S. government manages to remove all unauthorized workers, which is unlikely. These findings largely consistent with what I wrote in October 2024 when I scrutinized Trump's mass immigration idea on economic, social, legal, and political terms.
What this Wharton School study adds to the deportation debate is a clearer sense of the tradeoffs of deportation, not simply in dollars and cents, but also in the economic futures of most American workers. For those who care about the national interest of the United States, what should matter is a policy grounded in economic reality, not empty slogans. All Trump's mass deportation does is throw American workers under the bus.
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