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Business Daily
ICE: Is it chilling the US economy?
00:17:28
We look at how President Trump's crackdown on immigration is registering nationally
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- [00:00]
Ed Butler
This BBC podcast is supported by ads outside the uk
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Melissa Silva
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Ed Butler
Hi there, I'm Ed Butler. Welcome to Business Daily from the BBC World Service. Today, President Trump's anti immigration drive. What's it doing to the US economy?
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Gustavo Romero
The metro have completely killed our business. For me as a Mexican, my community has been traumatized. It's hard to believe that this can happen in this country.
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Ed Butler
Hundreds of thousands of migrant workers are now off work. They're either deported or afraid to leave their homes. But how much is that affecting America's bottom line?
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Mark Zandi
Because the immigrant workers aren't working, it's disrupting the entire operations and upsetting the ability of native born workers to do their jobs and therefore everyone gets affected. So I don't think this is helping in any way.
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Ed Butler
The ice, is it chilling the economy? That's Business Daily from the BBC. The sound there of mass protests on the streets of Minneapolis this year as Immigration and Customs Enforcement officers, ICE for short, move in to arrest migrants suspected of being in the US illegally.
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Gustavo Romero
Give them your hand.
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John Anderson
Give them your hands.
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Ed Butler
I'm not resisting.
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Gustavo Romero
I'm not resisting.
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Ed Butler
ICE agents claimed to have arrested thousands of illegal immigrants in Minnesota over the last three months, calling it the largest immigration enforcement operation ever carried out in the U.S. but the public anger, especially after the killing of two protesters, has left for some a bitter taste.
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Melissa Silva
What's happening here should not be happening. This is chaos. This is violence. This is economic violence.
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Ed Butler
That's Melissa Silva. She runs a food and grocery business in the city of St. Paul, and she says commercial life, especially for businesses serving migrant communities, has been devastated.
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Melissa Silva
If Latinos aren't here shopping, if vendors. I've even had struggle with some vendors because drivers are afraid to do deliveries. It's been a whole domino effect. And so the risk for us is really Scary. I mean, every aspect in our community is being impacted in a negative way.
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Ed Butler
Melissa Silva. Well, in Minneapolis, Mexican born restaurateur Gustavo Romero says the deployment of some 4,000 agents at its peak in his city has not just shaken the local population, it's hit all aspects of the local
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Gustavo Romero
economy a total nightmare. You know, the Metro surge have completely killed our business. For me, as a Mexican, my community has been traumatized. It's hard to believe that this can happen in this country. We have our door closed. We do it to protect our guests, to protect our staff.
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Ed Butler
Sorry, but you keep the door closed. Just explain that the door has been shut so people have to come in the back way. I mean, how do you.
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Gustavo Romero
No, no, no, no. The doors are closed and we have my wife and myself opening the door, welcoming people. It is becoming a normal thing here because they were just invading places. They would just go into restaurants and stores and harass people that were there. You know, we are Mexican restaurants, so we have a lot of people of Mexican descendancy, you know, so a lot of people are afraid to come out.
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Ed Butler
So our visitor numbers down. I mean, the number of orders you're serving come down.
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Gustavo Romero
Yes, yes, it has come down. And the demographic of the people has changed. You know, we're so grateful. They, a lot of our clientele, they're Caucasians, they're white, and then they're the ones that keep supporting us. But we, you know, it's a, I would say 80, 90% of the business around, they don't have the same luck. You know, if you go to order local Mexican groceries, you go to the local Mexican restaurants, they're completely empty. You know, if, you know, the ICE can potentially raid the school where your kid goes, you not go to work, and their parking lot so empty because that's where people get picked. They're just afraid.
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Ed Butler
Restaurateur Gustavo Romero in Minneapolis. Operation Metro Surge, as it was known, may now be winding down. It was simply targeting one US State. But since the start of this administration, President Trump has made a crackdown on immigration, a key nationwide policy objective.
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Trump Supporter
We allowed in our country. I say 25 million people with an open border policy. For four years under Biden, we allowed to come into our country people, people the likes of which no country would accept. And we're getting them out. Maybe we can use a little bit of a softer touch. But you still have to be tough. These are criminal. We're dealing with really hard criminals.
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Ed Butler
Last year, ICE detained some 330,000 people, according to research by the Guardian newspaper. It deported a similar number as well, a record for the U.S. immigration enforcement. And they've been doing this primarily in metropolitan areas across the US From Illinois to Arizona. But this is only part of the square on the non resident working population, tightened border controls have made it much harder for migrants, both legally and otherwise to enter the country. Even Jerome Powell, the chair of the Federal Reserve, has commented on how the anti immigration drive has affected the closely watched employment figures of the US Say,
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Jerome Powell
if you're looking at why employment is doing what it's doing, that's much more about the change in immigration. So the supply of workers has obviously come way down. There's very little growth, if any, in the supply of workers. And at the same time, demand for workers has also come down quite sharply to the point where we see what I've called a curious balance. You know, typically when we say things are in balance, that sounds good. But in this case the balance is because both supply and demand have come down quite sharply. Now, demand coming down a little more sharply because we see we now see the unemployment rate edging up.
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Ed Butler
Jerome Powell There. You're listening to Business Daily on the BBC World Service.
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Ed Butler
I'm Ed Butler and today we're looking at the economic impact of President Trump's anti immigration policy. How is it registering on a national level? To find out more, I've been speaking to a couple of employers in different sectors, house building and agriculture, both of which are highly dependent on Migrant labour.
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John Anderson
We have a shortage of skilled labor anyway. You want to go mucking about scaring the hell out of the people that we do have working for us, it's going to be a problem.
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Ed Butler
This is John Anderson. He's a construction consultant specializing in low cost housing in Georgia and Florida. He says he's never seen such an intense crackdown on a subset of his specialist workforce.
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John Anderson
The larger sites will get raided. Supply houses, ICE agents camp out there. But we also see people who got snatched up when they went to pick up their kids from school. So I have a family on the other side of the block for me, two brothers, three cousins, they're all from Mexico. Their mom, the matriarch, runs the company and they do drywall hanging and drywall finishing and they're fantastic. They are now at a point where they only work at night. Wow, seven people only working at night. And they have an Anglo neighbor who buys materials for them because they don't want to be seen anywhere near the material suppliers. This is ridiculous. And I mean, these are people that are making tremendous contributions to our economy. They make it possible for us to have a business and for some reason they're being targeted.
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Ed Butler
Are these people documented?
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Mark Zandi
Yeah.
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John Anderson
Being documented does not help you. If you encounter an ICE agent, they will grab you and they will detain you and it could be several months until you get out, even though you have every right to be here. Our long term strategy at this point is to train folks coming out of the foster care system, people returning from being incarcerated, maybe for nonviolent crimes, and for folks who have decided that they're not going to go to university. We need to identify those folks and train them in the skills that are going to be needed because at this point our federal government is crushing our ability to operate.
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Ed Butler
What kind of effect is this having on your industry, would you say?
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John Anderson
In Florida and Georgia everything's in flux. Everything takes longer because there are huge gaps in the schedule where the particular trade you need is not available and won't be for a while. So the productivity of people in the trades is being disrupted. It takes us now longer to build. It's going to be more expensive and it's. To what benefit? I mean, this is crazy. If we can't see reliable labor, then we can't have reliable pricing and can't keep reliable systems. And our bank gets upset because we're taking too long to build something and, and they raise their fees.
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Ed Butler
What would you like to see change?
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John Anderson
I would like to see real immigration reform. We used to Have a system by which seasonal workers could come to the US and working agriculture or construction for five or six months and then go home. We need people in this country to be able to do construction work. The idea that we're going to limit black, brown and Asian people for no reasonable excuse to make everybody's life more difficult is just rank racism and elitism.
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Ed Butler
The thoughts of Georgia based house builder John Anderson. So what's the picture in the Pacific Northwest? The sound there of heavy machinery tilling the soil on Alan Schreiber's fruit and vegetable farm. He's a fifth generation farmer in Washington state and he too depends heavily on migrants to bring in the crop.
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Alan Schreiber
At our peak in July and August, we will have 80 or so workers. They harvest everything, they plant everything. They plant every seed they put in, every transplant, they till the fields, they pack everything. Overwhelmingly our workers are Hispanic, either born in Mexico or their parents were born in Mexico.
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Ed Butler
Why from there is it hard to find native born Americans who can do this work?
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Alan Schreiber
It is not possible to find a white American that will pick crops that will till the soil, that will pound the post. And they simply won't do that work. Farm work, you know, it's outside, it's hot, it can be repetitive. And Americans have been here for a few generations or more. Find jobs that either pay more or more importantly, are less exertive.
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Ed Butler
What do you pay?
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Alan Schreiber
So our minimum wage here is $17.13 an hour. That's the highest in the Western hemisphere. And when we get busy, we can't get enough workers. And so we go into overtime in the thick of the season. They're making $1,000 a week.
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Ed Butler
That sounds like a decent wage. How has the last 12 months been for you in terms of getting workers?
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Alan Schreiber
Well, we did not have enough. And there were some times when crops were left in the field.
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Ed Butler
Really?
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Alan Schreiber
Absolutely. That happens every year. There is times when we simply do not have enough workers.
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Ed Butler
Have you heard about farms like yours being directly targeted by the immigration police?
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Alan Schreiber
I am very aware of farms that have had their employees seized. And there's a farm I know very well where on the way to work, a farm manager was pulled over and taken and deported back to Mexico. We have made plans on what to do if there is an immigration rate. All my workers present documents to me that appear to be legal. But I'm under no illusion. There is not a farm in this state or a state that borders us that employs a lot of workers where they're all documented. It's an illusion. If you Think that I can tell you that the Hispanic population in our area are somewhere between scared and terrified.
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Ed Butler
What would you like to see from the government?
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Gustavo Romero
Now?
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Alan Schreiber
We need a guest worker program that works. We need to have workers be allowed to come into this country, work, get paid, treated fairly, and be allowed to go home in a non cumbersome, non burdensome manner. I will tell you this. If every undocumented worker were suddenly gone, our country would starve. We would not have potatoes, we would not have apples, we would not have cherries, we would not have melon and watermelon, asparagus. We would not have any of the crops that I grow.
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Ed Butler
Alan Schreiber so is that really the picture across the economy at large? Well, Mark Zandi thinks so. He's the chief economist for the financial services firm Moody's.
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Mark Zandi
The data we have would be highly suggestive. This is disruptive to everybody. But you can see it in communities where like they're trying to build data centers. I mean that's a boom, part of the construction trades. And many places in the country where that's happening, they're having a hard time finding workers and in large part because they need those immigrant workers. I mean, just to give you a number, in typical times, foreign born workers account for almost a third of the workforce in the construction trades. And if you go into parts of the south and western parts of the United States, it's almost a half.
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Ed Butler
And yet the US economy seems to be doing pretty well.
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Mark Zandi
Well, I guess it depends on which part of the elephant you touch. If you look at the labor market, not so much. I mean the economy has not created any jobs. Some months it's up a little bit, like in January it was up a little bit. Some months, some months down a little bit. But net, net, net nothing. And that's a pretty tenuous place to be. Hard to feel like you're in a well functioning economy for not creating any jobs.
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Ed Butler
Won't fewer jobs for undocumented migrants support jobs for native born Americans?
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Mark Zandi
No. You know, in many cases the fact that you have immigrant workers support other jobs. I mean going to the food processing plants, meat packing plans, because the immigrant workers aren't working, it's disrupting the entire operations and upsetting the ability of native born workers to do their jobs. And therefore everyone gets affected, including the native born. So no, I don't think this is helping in any way. And of course, you know, immigrants, they demand things, they need things, right? Need a home, they buy food, they buy clothing, they buy vehicles, you know, They're a big part of the economy. So if you know they're not working and spending, that affects all jobs for everybody, including native born in those industries.
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Ed Butler
Mark Zandi well, we wanted to know what the administration had to say about all this. We did ask the U.S. treasury for comment. We also approached Thomas Philipson. He's a former White House economic adviser during President Trump's first term in office.
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Thomas Philipson
The question is, do you want to have an illegal workforce or not? I mean if you want low skilled workers to enter country at a larger rate, there's certainly room for Congress to change immigration policy to have low skilled workers coming at a larger rate.
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Ryan Seacrest
Sure.
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Ed Butler
But I mean, isn't the point here that it isn't legal because you're not actually granting visas, even temporary ones, to migrant workers, for instance, to come in and do the fruit picking or whatever it might be? Those visa schemes have been frozen or slowed down?
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Thomas Philipson
Yeah, it depends on the country that you're talking about. But it has been a slowdown. Certainly there's been a slowdown in illegal immigrants. We had about 10 to 20 million people come in illegally. Some of them went to work and some of them did not want to work. That has certainly impacted job growth. The question is, is that beneficial for the country or harmful for the country? And people disagree on that.
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Ed Butler
Well, what do you think we're seeing not only a huge drop off in migrant non native born Americans dropping out of the workforce, but we're not actually seeing much of an uptick on native born Americans in the workforce.
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Thomas Philipson
Well, there's several forces obviously that's contributing AI, that we have a lot of AI related layoffs. But also we have an enormous productivity boom in the US taking place where we had have modest job growth essentially. But we had 3.2% growth in GDP the last three quarters under Trump, which is a large GDP growth with modest labor growth, which means we had much increase in productivity. So there's other forces in immigration that are pointing to this essentially is the
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Ed Butler
sum up here that you don't think this is not a, an economic measure? The anti immigration policy and he's not really looking at the economic consequences.
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Thomas Philipson
He's basically enforcing the law. We have illegal immigration and we don't want illegal activity in our country. And that might have certain economic implications certainly. But it doesn't appear that our economy is very weak. It's actually picked up the last year both for workers pay and also in economic output.
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Ed Butler
The view there of the former Trump economic advisor Thomas Phillipson, ending this edition of Business Daily. I hope you enjoyed it. From me, Ed Butler and producer Josh Martin. Take care.
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Melissa Silva
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