By Sabrina Escobar, Evie Liu, Megan Leonhardt, Shaina Mishkin, and Mariapaula Gonzalez .

American businesses that rely on immigrant labor are already absorbing the brunt of stepped-up raids under the Trump administration sweep through worksites, farms, and factories. With a goal of 3,000 arrests a day, Immigration and Customs Enforcement, or ICE, has intensified detentions nationwide -- leaving some construction sites deserted, crops unpicked, and employers scrambling.

Across critical sectors, business owners say fear of arrest is driving both undocumented laborers -- and legal immigrants -- to stay away from worksites.

A construction site in Elkhorn, Neb., which typically employs dozens of workers, has been a "ghost town" since Monday morning, Juan Alvarado, business representative of the North Central States Regional Council of Carpenters, told Barron's. Alvarado said that while the majority of the skilled union members are legal migrants, both documented and undocumented workers have been impacted by increased immigration enforcement. His phone has been "blowing up" this week, he said, with calls from workers who have family members detained at work in Omaha, Neb., and St. Paul, Minn.

"Whether people are legal or not, they don't care," Alvarado said. "If chaos and fear is what they were after, they've accomplished it," he said of immigration authorities.

Following an ICE raid at its facility in Omaha, Nebraska on Tuesday, Glenn Valley Foods was running with only 30% of its normal head-count. Output had crashed to 20% of capacity, the company's president, Chad Hartmann, told Reuters. The company's LinkedIn page says it supplies pork, steak, chicken and corned beef to restaurants and groceries.

While many employers haven't yet seen a meaningful impact on their labor force, industry groups, unions, and businesses across the country say that could change in the coming months, which is a worry for economists. About 70% of employers expect increased enforcement by ICE and the Department of Homeland Security to have a significant or moderate impact on their workplace in the next 12 months, according to the 2025 Littler Annual Employer Survey Report released last month.

The negative effects could be exacerbated by efforts to end several work programs, such as Temporary Protected Status and the Cuba, Haiti, Nicaragua, Venezuela Parole Program. These programs previously granted work authorization to hundreds of thousands of immigrants, who would be deemed undocumented.

Sectors heavily dependent on immigrant workers, such as agriculture and food processing, construction, and services, could find themselves strained for labor, as President Donald Trump acknowledged.

"Our great Farmers and people in the Hotel and Leisure business have been stating that our very aggressive policy on immigration is taking very good, long time workers away from them, with those jobs being almost impossible to replace," he wrote in a Truth Social post Thursday, adding that the country must protect farmers while getting "CRIMINALS OUT OF THE USA" and that change was coming.

The White House didn't clarify what that change could be, but spokesman Kush Desai said in an email to Barron's that there is "no shortage of American minds and hands" to grow the country's labor force.

In a statement to Barron's, ICE said that worksite enforcement is a priority for the agency.

Foreign-born workers, including undocumented immigrants, have become an integral part of the U.S. workforce in the past decade or so. They accounted for 19.2% of the U.S. labor force in 2024, up from 18.6% in 2023 and 11% in the late 1990s, according to data from the Bureau of Labor Statistics.

Agriculture and Food Processing

Although federal laws forbid companies from "knowingly" employing anyone lacking work authorization, much of the U.S. agriculture and food-processing workforce is undocumented. A survey from the Department of Agriculture shows that 42% of hired crop workers were immigrants without work authorization in the 2020-22 period.

On Tuesday, the ICE raid in Omaha on meat producer Glenn Valley Foods resulted in 76 arrests. On the same day, a video of ICE agents and a white van chasing an immigrant laborer through strawberry fields in Oxnard, Calif., circulated widely online and drew condemnation from the city's mayor.

Any effort to reduce the number of foreign-born agricultural workers could lift prices. The National Milk Producers Federation, which says that 51% of its workers are immigrants, warned that losing the foreign-born workforce would nearly double retail milk prices.

Construction

An estimated 14% of the construction industry workforce is staffed by undocumented immigrants, according to the American Immigration Council. "Anything that provides a shock to the labor force could be detrimental to the construction industry and our labor supply and exacerbate our housing affordability problems," Buddy Hughes, chairman of the National Association of Home Builders, said in a statement to Barron's.

Industry analysts say that ICE raids haven't resulted in a widespread pullback in construction yet. More than nine in 10 builders surveyed by John Burns Research and Consulting earlier this year said they saw no labor-force impact from deportations or changes in immigration policies. "I expected we would have seen an impact more than we have," says Eric Finnigan, the firm's vice president of demographics research.

That could be because builders themselves are curbing construction. New home sales and construction year to date through April both paced below last year's level.

"The underlying demand for work is still somewhat muted coming off of the torrid pace that we were at during the pandemic," said Bradley Thomas, an analyst at KeyBanc Capital Markets.

That doesn't mean that labor availability won't be a bigger problem in the future, especially if buying conditions improve. "It might bubble up to a bigger concern if [housing] demand somehow bounces back next year," says Finnigan.

Services

About 22% of foreign-born workers were employed in service occupations in 2024, compared with 15% of workers born in the U.S., according to data from the Bureau of Labor Statistics. The services sector includes hospitality businesses such as restaurants and hotels, and child-care, personal care, and healthcare. Immigration raids could hit these businesses hard.

"If you're dealing with squeezed margins because of rising import prices due to tariffs, and then you throw into the mix the fact that you can't hold on to workers and you have to jack up pay for others, it is going to be quite difficult to manage through that," says Moody's Chief Economist Mark Zandi.

Research has shown that immigration enforcement programs that ran from 2008 to 2014 reduced the supply of child-care workers.

"Curbs to immigration will further push up prices for in-home care that are already increasing at about three times the pace of overall inflation," Matthew Nestler, senior economist at KPMG Economics, said.

Undocumented immigrants typically account for about 7% of workers in the hospitality sector, according to estimates from the American Immigration Council. They fill positions ranging from housekeepers to restaurant dishwashers. The industry was hard-hit by the effects of the Covid-19 pandemic and labor shortages. Today, the American Hotel & Lodging Association reports industry staffing remains below 2019 levels.

Consumer

The big hit to restaurants and other consumer-focused companies may come from fewer customers. The stepped-up raids have prompted many immigrant households, particularly those with undocumented members, to stay home and cut spending.

"People will stay home and reduce their outings to absolutely essential things," said Carola Otero Bracco, executive director of Neighbors Link, a nonprofit based in Mount Kisco, N.Y., that works with immigrant integration.

Retailers aren't as dependent on foreign labor as other sectors, but are increasingly reliant on immigrant spending. An analysis by the Hamilton Project estimates that the postpandemic increase in immigration alone contributed $73 billion in real consumer spending in 2024, lifting total spending by 0.2 percentage points.

In a June 9 fireside chat, Walmart Chief Financial Officer John David Rainey said that "immigration noise" was part of the reason the retailer had a softer start to the year. In its May 29 earnings call, Burlington Stores said shops along the southern border had weaker sales compared with other stores the previous quarter.

Constellation Brands, which distributes Mexican beers such as Modelo, Corona, and Victoria, derives about half of its beer business from the Hispanic community. In the past couple of months, demand from those consumers has declined as restaurant and other social outings have decreased, executives said at a June 3 investor conference.

"The Hispanic community often has lots of social occasions and those tend to be beer occasions, so you're seeing a fair amount of differences in how the consumer interacts," said William Newlands, CEO of Constellation Brands.

Write to Evie Liu at evie.liu@barrons.com, Megan Leonhardt at megan.leonhardt@barrons.com, Shaina Mishkin at shaina.mishkin@dowjones.com and Sabrina Escobar at sabrina.escobar@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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June 12, 2025 17:47 ET (21:47 GMT)

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