How A Mass Deportation Of Immigrants Would Impact Businesses

President-elect Donald Trump’s plans to follow through on his campaign pledge to address the immigration crisis by deporting millions of immigrants would spawn a variety of crisis situations for companies and organizations, according to experts and observers.

Ripple Effects

The ripple effects of a mass deportation would include labor shortages in agriculture, construction, hospitality, and other industries, according to Usha Haley, the W. Frank Barton Distinguished Chair in International Business and a professor of management at the Barton School of Business at Wichita State University, said via email.

“By some estimates there about 11.3 million immigrants in the USA without legal status—that is, about 22% of all immigrants to the USA are illegally here, the highest proportion of any country in the world. Clearly, this is a problem. But so are the costs of deportation and meeting them will result in trade offs,” she noted.

Deporting immigrants would also hurt the economy.

“By one estimate from an immigration policy group, GDP could shrink by $1.1 trillion to $1.7 trillion, but in his recent comments Trump has also said his plan will bring more businesses into the country and the U.S. needs more workers to grow,” CNN reported.

Impact On Tech Sector

A “mass deportation would create an immediate crisis in the tech sector, where immigrant talent drives innovation,” Bethany Plaza, CEO of two technology companies, warned via email.

The deportation would also hamper the country’s efforts to compete in key areas.

“In my role leading global IT teams, I’ve seen firsthand how diverse talent pools accelerate technological advancement and market competitiveness. The loss of immigrant workers would critically impact our ability to compete globally in emerging technologies like AI and robotics,” she pointed out.

On The Hot Seat

The mass deportation of immigrants could put many business leaders in the hot seat.

“There will be demands for companies to speak out against mass deportation from an ethical and diversity/race perspective” that could impact corporate reputations, Elle Arlook, who leads an equity and justice practice at APCO, a global advisory and advocacy firm, predicted in an email interview.

Steps For Business Leaders

In anticipation of Trump’s promised mass deportation of immigrants, business leaders should take the following steps, according to Andrew Lokenauth, founder of The Finance Newsletter, advised via email.

Analyze Workforce Exposure

“Closely examine what percentage of your workforce is immigrant, which roles they fill, and how critical they are to operations.”

_{Develop Contingency Plans}

“Have backup plans to replace lost workers through retaining, recruitment drives, automating roles, relocating operations, etc.”

Advocate Policy Positions

“Get involved with lobbying for immigration policies that protect your sectors and communities. A pragmatic approach is needed.”

Strengthen Training Programs

“Ramp up training to enable quick upskilling of replacement workers if deportations occur.”

Diversify Hiring Sources

“Cast a wide geographic net when recruiting to build fallback labor pools in multiple regions.”

The Need For Diversification

“In a less-discussed impact, a shrinking immigrant population would reduce consumer spending in major urban centers, impacting local businesses and driving down demand. Leaders should diversify their customer base now to buffer against potential sales declines,” Idan Ohayon, a certified financial planner who specializes in analyzing market impacts from regulatory and demographic shifts, noted via email.

Training workers to fill the vacancies left by deported immigrants might help to take up the slack.

“Partnering with workforce development agencies for training can ensure a steady talent pipeline. This approach will help businesses stay agile and resilient if faced with these demographic shifts,” he recommended.

No Guarantee

But there is no guarantee that US workers would want to fill all of the vacated jobs.

“Americans generally agree that immigrants—whether undocumented or living legally in the country—mostly do not work in jobs that U.S. citizens want, with a majority saying so across racial and ethnic groups and among both political parties,” according to a 2020 Pew Research Center Survey.

“This is particularly true when it comes to undocumented immigrants. About three-quarters of adults (77%) say undocumented immigrants mostly fill jobs U.S. citizens do not want, while 21% say undocumented immigrants fill jobs U.S. citizens would like to have,” the survey’s report said.

Crisis Management Plans And Scenarios

If they have not already done so, companies should confirm that their crisis management plans include how mass deportation scenarios would impact their organizations.

“HR and corporate communications leaders should be scenario planning now to determine if and how they’ll engage in the issue areas that are sure to land on their doorsteps in this next administration,” APCO’s Arlook recommended.

Going forward, business leaders should carefully consider the potential ripple effects of any steps they take to address the impact of the deportation of immigrants—or other crisis situations—and ensure that that their actions do not make a bad situation worse, or create new crisis situations.