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Home » U.S. Tariff and Deportation Policies on Collision Course in Agribusiness
SCB FEATURE

U.S. Tariff and Deportation Policies on Collision Course in Agribusiness

IN A SKETCH DRAWING, A FAMILY NAVIGATES A PRECARIOUS JOURNEY ON THE EDGE OF ONE OF THE STRIPES OF THE AMERICAN FLAG

Image: iStock/Marcos Silva

July 9, 2025
Helen Atkinson, Managing Editor

When U.S. farmers can’t get the workers they need to harvest crops, those crops rot in the fields. This happened during the COVID-19 pandemic, and added to the food supply chain woes that came from disruptions and bottlenecks around the world, leading ultimately to shortages and inflation. Aggressive deportation policies have created strain in the agricultural labor market before. Now, they are set to do so again, in what’s likely to be an unprecedented way.

Usually, a shortfall in domestic supply of, say, strawberries can be compensated for by imports, which is why we can eat them year-round. But two policies currently being pursued by the administration of President Donald Trump — immigration and import tariffs — seem set to make labor shortages intensify while driving up the price of imports. A shortage of immigrant labor is also likely to slow down warehousing and distribution operations. As things stand, American consumers this summer are likely to experience either empty produce shelves or eye-watering price rises, or both.

“If the crops here continue the way they are, I don’t think we’ll be able to fill our shelves with U.S. produce, as we have in the past,” says Julie Taylor, executive director of the National Farm Worker Ministry (NFWM), a faith-based organization committed to social, economic, and racial justice for farm workers. “And that will hit the public hard.” 

The U.S. has long tolerated the fact that a huge proportion of workers in the agriculture, construction and hospitality industries are working illegally, what a 2004 Boston Globe editorial called “the dirty little secret of the American economy.” 

It’s a pretty badly kept secret, though. According to U.S. Department of Agriculture (USDA) figures, roughly half of hired crop farmworkers lack legal immigration status. The share of hired crop farmworkers who were not legally authorized to work in the United States grew from roughly 14% in 1989–91 to almost 55% in 1999–2001; in recent years it has declined to about 40%, the USDA says. The Pew Research Center estimated in 2024 that there were about 8 million unauthorized immigrants employed in the U.S., which is about 5% of the total workforce.

Workers employed illegally lack basic protections, including recourse for withheld or stolen wages, and insurance in case of injury. They also are frequently forced to resort to undignified living conditions (many sleep in cars, including in the trunk, Taylor says), and can even end up as little more than indentured servants when employers withhold their passports or prevent them from leaving farm compounds.

Even those with work visas, such as under the H-2A Temporary Agricultural Workers program, which allows U.S. employers to bring foreign nationals to the U.S. for temporary or seasonal agricultural jobs, are only allowed to work for a specific employer and for a limited time. That means the farmer can effectively hold them to ransom, since they cannot legally work elsewhere. 

The idea that U.S. citizens would be willing to work long hours, doing back-breaking work in hot fields for as little as $6 per hour, then go to eat and sleep in a trailer housing nine other people who are each paying $200 a week for the privilege is a fantasy. Taylor describes a typical scenario in the harvesting of sweet potatoes. Workers fill a bucket with 32lbs of sweet potatoes, then haul them by hand to a truck 30 to 50 yards away. In order to make $50, they have to do that 125 times. “Then you have to check your pay stub to make sure they paid you for it,” she says. She concedes there are some U.S. citizens willing to do this work, but not many; most farmers she’s talked to say Americans tend to leave after half a day on the job. Immigrants from low-income countries have a wholly different attitude. “These people are desperate, and willing to do this for their families,” she says.

Farm groups are fully cognizant that U.S. citizens are unwilling to do the arduous labor; their solution is to make immigrant labor even cheaper by lobbying for the loosening of H-2A regulations, including reducing wage and housing requirements, according to the Guardian. Trump heeded their calls before. In 2019, his Department of Labor unsuccessfully proposed removing some regulations applied to H-2A workers. At present, the administration’s plans for the program remain unclear.

Conservative think tank American Compass argues for a “skills-based immigration policy” which it says would require “serious immigration enforcement that prevents people from working illegally. Such enforcement will need to deal prospectively with the future flow of immigrants as well as grapple with the millions of illegal workers already here,” it stated in a policy brief.

Some hope to see significant immigration policy reform; one that reflects the opportunities presented by automation, for example. “The America First trade policy is very, very clear on a trajectory for getting America off cheap labor,” says Ram Ben Tzion, the CEO and co-founder of Publican, which uses artificial intelligence to vet freight shipments by cross-checking data across numerous sources. “The tariffs and immigration policies aim to bring back jobs, but not cheap-labor jobs. The intention is to automate manufacturing, and have AI replace a lot of cheap Chinese labor.”

While that might be a tough call for the agriculture business, overall there needs to be a controlled transition from reliance on illegal workers, Tzion says. “Look at Canada. They have quotas of expats in all of these industries that are not being provided for by local labor. I would expect the U.S. to do the same. But this has been impossible to reform for the last 30 years – this abnormality.”

Meanwhile, there’s growth in the fear and uncertainty created by the Trump administration’s chaotic implementation of its deportation policy, which has included the Immigration and Customs Enforcement (ICE) agency canceling work visas and asylum status on the spot, and rounding up and deporting immigrants without due process. Trump’s stance on immigration this Spring has fluctuated wildly. In mid-June, Trump’s administration ordered ICE to stop workplace immigration enforcement actions unless related to criminal investigations, in the face of growing public backlash. But, days later, Trump’s post on Truth Social appeared to reverse that position, and raids on farms, as well as other workplaces, recommenced.

Understandably, many immigrant workers, whether in the country legally or not, are laying low or self-deporting. 

In other words, this time is different.

“There have been labor shortages off and on for a number of years, but I think right now it’s more widespread across the country and, because of the nature of how it’s being done, it’s more prevalent,” says Taylor. “In some cases, the immigrant raids have been in states that were more relaxed on immigrant polices [before], and those seem to be the targets now, such as California, New York and Southern Texas. They tended to leave alone the large agricultural operations in these places. But now it’s different.”

Social media has made ICE raids more high-profile than ever, Taylor observes. “These  visions of people running through the fields with ICE chasing them is a deterrent,” she says. “Most workers don’t have much, but they have a cellphone and can see what’s happening, and they have adapted to be able to tell each other: ICE is in the area, don’t go in to work today.” 

Already, there are signs of rising prices. Food price inflation in the U.S. peaked in 2022, at 9.9% compared to 2021, but dropped to 5.8% in 2023 and 2.3% in 2024, according to the USDA’s Economic Research Service’s (ERS) Food Price Outlook. Now, prices are on the rise again. They will be driven higher by the cost of the imports needed to cover any shortfall in U.S. production. According to PBS, nearly all economists expect Trump’s duties will make many things more expensive in the second half of this year, including groceries, though by how much is still uncertain.

Read More: U.S. Immigration Fight Heats Up Over Seasonal Work Visas

 A study conducted by the Peterson Institute, released in September 2024, found that mass deportation could affect agricultural labor and lead to a 10% increase in food prices.

It’s not just sticker-shock in the grocery aisle that’s at stake. Firms that have a harder time finding workers will limit their ability to grow, slowing the overall economy, warns economist Giovanni Peri of University of California, Davis, interviewed by BBC News. A smaller workforce could feed inflation in another way, by forcing firms to pay more to recruit staff, and pay higher wages; costs that will be passed on to the consumer.

A December 2024 report from the U.S. Congress Joint Economic Committee Democrats (JCE), warned that mass deportations would “reduce economic growth, shrink the labor force, cost U.S.-born workers their jobs, raise costs for nearly all Americans, and risk igniting inflation.”  

The JCE forecasts that, depending on how many immigrants are deported, these mass deportations would shrink real gross domestic product (GDP) by as much as 7.4% by 2028, and reduce the supply of workers for key industries, including by up to 225,000 workers in agriculture, and 1.5 million workers in construction.

Read More: Does U.S. Agriculture Need Immigrant Labor? Ask Great Britain.

According to the Carsey School of Public Policy at the University of New Hampshire, economic research shows that past deportations have harmed U.S. workers with lost jobs and lower wages. For example, the deportation of 454,000 immigrant workers not authorized to be in the United States from 2008 to 2015, under President Barack Obama, reduced the employment share of U.S.-born workers by 0.5%, and reduced their hourly wages by 0.6%.

Taylor argues that the cost of food in the U.S. has been kept artificially low because of reliance on immigrants working illegally. “We don’t want to pay a lot of money for our food in the U.S.,” she says, noting that basic food costs haven’t gone up at the same rate as housing, rent, or cars over the years. “If you start to compare them, we’ve gotten a break on food, but it’s been a result of the work of these folks do.”

It seems incredible that an industry can survive when 42% of its workers (and their employers) are breaking the law. But the situation has been dug in for a very long time. “The industry is saying if we can’t get this cheap labor, then we won’t exist,” says Taylor. “It’s a big discussion.” 

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