US-born workers lose ground even as immigrant workforce shrinks

Fewer immigrants, but Americans aren’t gaining

The foreign-born workforce has shrunk by about 1 million workers since March 2025. But American-born workers haven’t picked up the slack.

A March 2026 policy brief from the National Foundation for American Policy (NFAP) analyzed Bureau of Labor Statistics (BLS) household survey data and found labor force participation for U.S.-born workers actually fell, dropping from 61.4% to 61.0% between February 2025 and February 2026.

U.S.-born unemployment also ticked up, from 4.4% to 4.7%.

Over 1 million foreign-born workers left

BLS data showed about 596,000 foreign-born workers left the labor force since January 2026 alone. Since the foreign-born workforce peaked in March 2025, the total drop reached about 1.01 million.

That’s a big deal. From 2014 to 2024, more than half of all U.S. labor force growth came from immigrant workers.

The overall U.S. labor force has shrunk by about 213,000 workers since January 2025, according to BLS seasonally adjusted estimates.

Job growth slowed sharply last year

Revised BLS data painted a rough picture: the U.S. economy added just about 181,000 total nonfarm jobs in all of 2025, averaging roughly 15,000 per month.

That number dropped sharply from an earlier estimate of about 584,000.

February 2026 brought an even bigger hit, with nonfarm payrolls falling by about 92,000, though a healthcare worker strike at Kaiser Permanente involving more than 30,000 workers played a role.

The overall unemployment rate stood at 4.4% in February, up from 4.0% when President Donald Trump took office.

One Big Beautiful Bill funded the crackdown

The Trump administration signed the One Big Beautiful Bill Act into law on July 4, 2025. The law put roughly $170 billion toward immigration enforcement and border security through 2029.

About $75 billion went to Immigration and Customs Enforcement (ICE), roughly tripling its yearly budget. Another $46.6 billion went toward border wall construction and related projects.

That funding has driven much of the enforcement push behind the workforce numbers.

Net migration went negative for the first time

For the first time in at least 50 years, more people left the U.S. than came in.

The Brookings Institution estimated net migration fell somewhere between negative 10,000 and negative 295,000 in 2025. The shift came more from a sharp drop in people entering the country than from deportations alone.

Brookings projected that very low or negative net migration could continue through 2026, which would extend a trend not seen in modern American history.

Economist warns fewer immigrants could backfire

NFAP Senior Fellow Mark Regets, a labor economist, said most economic research shows immigration actually increases job opportunities for U.S.-born workers.

Immigrants create demand for goods and services and work alongside American-born workers in ways that boost productivity for both groups, he said.

Regets warned that companies unable to fill certain roles could shut down operations entirely rather than keep hiring.

NFAP has separately projected Trump immigration policies could reduce U.S. workers by about 6.8 million by 2028.

Other forces are dragging on jobs too

Immigration policy isn’t the only thing weighing on the labor market.

Federal government employment has dropped by about 330,000, or 11%, since October 2024 due to workforce reduction efforts. Tariff uncertainty and the Iran conflict have added more headwinds in early 2026.

On top of that, the BLS noted a January 2026 population control adjustment by the Census Bureau lowered the measured labor force participation rate by 0.4 percentage points.

All of this makes it hard to pin job losses on any single cause.

White House calls the economy strong

White House economic adviser Kevin Hassett said average payroll growth over recent months is roughly in line with what you’d expect given less immigration.

He said break-even job growth is probably around 30,000 to 40,000 per month now that immigration has slowed. Hassett described the economy as “really strong” despite the softer numbers.

The Trump administration has publicly pointed to negative net migration as a policy win.

The survey data has real blind spots

Not everyone trusts the numbers at face value. The St. Louis Federal Reserve noted the Current Population Survey (CPS) wasn’t built to precisely track immigration-related population shifts because the Census Bureau doesn’t produce population controls by nativity.

The Peterson Institute for International Economics argued the CPS likely overstates the decline in the foreign-born population.

Brookings added that increased survey nonresponse likely hits immigrants harder in the current enforcement climate. NFAP acknowledged these gaps, noting the actual decline could be smaller or larger.

Long-term projections show steep economic costs

Looking further out, the numbers get bigger. NFAP estimated Trump immigration policies could reduce the projected U.S. workforce by about 15.7 million by 2035, with a potential loss of roughly $12.1 trillion in cumulative GDP from 2025 to 2035.

The American Enterprise Institute, a conservative think tank, found negative net migration could cut annual GDP growth by 0.3% to 0.4%.

Brookings estimated the immigration slowdown already shaved 0.2 to 0.3 percentage points off GDP growth in 2025.

Cato study found immigrants paid more than their share

A February 2026 white paper from the Cato Institute found immigrants generated a fiscal surplus of about $14.5 trillion from 1994 to 2023.

Immigrants made up about 14.7% of the U.S. population in 2023 but paid about 17.3% of total taxes. Without immigrants, the study found public debt would top 200% of GDP.

The Center for Immigration Studies, which favors lower immigration, has pushed back on this method, pointing to higher welfare usage among immigrant households.

The Cato study built on a model first developed by the National Academies of Sciences, Engineering, and Medicine.

Early data shows a gap between policy and results

So far, the data doesn’t show U.S.-born workers stepping into jobs left by departing immigrants.

Economists across the political spectrum have warned that a shrinking labor force could slow growth and push prices higher.

Fed Chair Jerome Powell previously noted that growth in foreign-born workers helped bring down inflation during the post-pandemic recovery.

U.S.-born labor force participation and unemployment both moved in the wrong direction during the first year of the immigration crackdown, though economists disagree on how much of that traces back to immigration policy versus other factors.

This article was created with AI assistance and human editing.

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