The President-elect has promised to deport millions of undocumented migrants which could end up creating severe labor shortages.
www.newsweek.com
"If you're upset about grocery prices now, see what happens if Trump goes after a huge part of the agricultural workforce," Krugman wrote.
He detailed how Trump's pledge to deport millions of undocumented immigrants could create a severe labor shortage in critical sectors like agriculture, food processing, and construction, leading to substantial price hikes.
According to Krugman, immigrants make up about three-quarters of agricultural labor, with roughly half of them undocumented.
Food processing also heavily relies on immigrant labor. He estimated that 30 to 50 percent of meatpacking workers are undocumented.
Krugman warned that deporting these workers would force the industry to offer significantly higher wages, a cost that would likely be passed on to consumers.
Krugman further explained that Trump's plans would damage the productive capacity of the economy at a
time of near-full employment, fueling inflation.
"Could we easily make up for the loss of these workers by replacing them with native-born workers? No," he said. "Employment among native-born adults in their prime working years is higher than it was at any point during Trump's first term."
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Undocumented immigrants constitute more than a fifth of the U.S. construction workforce. "The answer to that problem is to build more housing units," Krugman wrote, claiming deportations would severely hamper efforts to increase the housing supply.
sidenote: from pew research:
The number of unauthorized immigrants in the U.S. workforce grew from 7.4 million in 2019 to 8.3 million in 2022. The 2022 number equals previous highs in 2008 and 2011.
Unauthorized immigrants represent about 4.8% of the U.S. workforce in 2022. This was below the peak of 5.4% in 2007.