Falling rent, rising wages stop immigrants works
Executive summary
Falling immigration has coincided with mixed labor-market signals in 2025: net international migration (NIM) is estimated to have plunged to about 515,000 in 2025 from 2.2 million in 2024 (San Francisco Fed) [1]. Researchers and industry groups disagree about the consequences—some find weaker employment growth and stagnant real wage gains despite fewer foreign-born workers (Minneapolis Fed, Forbes), while private‑sector data and sectoral reporting say immigrant labor remains central to construction and other industries, and enforcement actions are creating localized shortages and project delays [2] [3] [4] [5].
1. Why the headline “falling rent, rising wages stop immigrants works” oversimplifies the picture
The claim compresses several different trends — lower immigration flows, wage movements, and housing costs — into a single causal chain that the available reporting does not establish. Federal Reserve analysis shows NIM fell sharply to roughly 515,000 in 2025, which matters for labor‑force growth, but the San Francisco Fed does not link that number to falling rents or document a nationwide, immediate exit of immigrant workers caused by higher wages or housing conditions [1]. Other sources explicitly find that declining immigration cannot fully explain the slower job growth or the shifts in employment shares seen in 2025 [2].
2. What the macro data actually say about immigration and the labor force
Multiple policy and research outlets report large swings in immigration in 2024–25 and warn of demographic effects: without immigration the working‑age population would have been shrinking earlier, and immigration still adds to prime‑age labor-force growth in 2025 though at a much lower level than 2024 [1]. Think‑tank and Fed analyses show immigration historically accounts for a large share of U.S. labor‑force growth and that lower NIM can damp future employment and GDP growth; those projections vary with assumptions, so effects are probabilistic, not immediate certainties [6] [7] [8].
3. Wages, employment growth and who benefits — competing interpretations
Empirical work finds a softer labor market in 2025: monthly job creation slowed by about 156,000 relative to 2024’s pace in one comparison and median real wage growth weakened, especially for low‑wage workers — a pattern inconsistent with a simple “fewer immigrant workers → higher wages for natives” story [2]. Forbes commentary echoes this: declines in the foreign‑born labor force did not clearly improve U.S.‑born workers’ fortunes and overall labor‑force participation has barely expanded in 2025 [3]. Those analyses emphasize that multiple forces — demand weakness, demographic shifts and measurement issues — interact with immigration changes [2] [3].
4. Localized shortages and sectoral pain: construction and agriculture
Industry and local reporting show concrete disruptions where immigrant shares are high. Construction analyses find foreign‑born workers make up more than a quarter of the workforce in some states (25.5% in Illinois), and industry groups cite raids and enforcement as reasons projects stall and crews thin out [4] [5]. The Center for Migration Studies and other sector studies had already warned of potential shortfalls in construction and agriculture absent immigrant labor [9].
5. Measurement disagreements and private‑sector counters
There is active debate about the magnitude of the immigrant‑workforce decline. Bureau of Labor Statistics and Census estimates suggested large drops in foreign‑born workers in early‑to‑mid 2025, while private data firms like Revelio offered counter‑evidence that foreign‑born employment continued to grow faster than native‑born employment [10]. Analysts caution household survey non‑response and reluctance to report among unauthorized immigrants may exaggerate measured declines [6] [10].
6. Policy moves and projected long‑run impacts
Studies of proposed or implemented policy changes underscore large potential long‑run labor‑force effects: one projection tied aggressive enforcement and legal‑immigration cuts to multi‑million reductions in the workforce and slower GDP growth over the next decade [11]. That study and others make clear that short‑term enforcement effects (raids, removals) can have immediate local impacts while structural demographic consequences accumulate over years [11] [1].
7. Bottom line for readers: nuance, not a single cause
Available reporting shows immigration declined in 2025 and that decline matters for labor‑force trends and for industries with high foreign‑born shares, but the evidence does not support a single, economy‑wide mechanism—such as falling rents or rising wages—fully explaining immigrant labor exits or native employment gains [1] [2] [4]. Researchers, private data firms, and industry groups disagree on magnitudes and mechanisms, so policy conclusions must account for measurement uncertainty, sectoral vulnerabilities, and longer‑term demographic effects [1] [10] [5].