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Research — Policy Center

An Uncertain Future: How the Immigration Crackdown Threatens Massachusetts’ Labor Force

Recent federal immigration restrictions could have significant implications for Massachusetts’ economy and labor force. While much of the public discussion has focused on the human impact of these policies, this report examines their potential economic effects, with particular attention to labor force dynamics in three key industries. The analysis comes at a time of heightened uncertainty for the Massachusetts economy, as shifts in federal policy — including changes to research funding and the social safety net — may further affect the state’s workforce, employers, and communities.

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June 4, 2026

Executive Summary

The second Trump administration has made restricting immigration a central priority, pursuing an agenda designed to reduce the nation’s foreign-born population across nearly every dimension. While much attention has rightly focused on the human impact of the crackdown, this report examines its economic implications for Massachusetts, particularly its effects on labor force dynamics within three key industries. This comes at a precarious moment for the local economy, as other federal actions, including cuts to research funding and reductions in the social safety net, compound the stress of the immigration crackdown.

The report combines demographic and labor market analysis with interviews conducted with people working in life sciences, healthcare support, and construction. Particular attention is given to the state’s Gateway Cities, where large numbers of immigrants have settled in recent years.

Key findings from this work include:

Immigrants have become central to the state’s economic growth.

Massachusetts faces strong demographic headwinds, including low birth rates, domestic outmigration, and an aging population. Fortunately, immigrants have provided an offset.

  • Massachusetts has the second lowest native-born birth rate in the country.
  • Immigrants now make up roughly one-quarter of the Massachusetts labor force, playing essential roles
    across all sectors of the economy, from research laboratories and universities to hospitals, construction
    sites, restaurants, and Main Street small businesses.
  • We estimate the state will need at least 60,000 net new immigrants annually by 2030 just to maintain the current size of its working-age population. Without immigration at something close to this scale, Massachusetts risks economic contraction.

Immigration has already slowed significantly.

While conditions are changing quickly, and we are less than a year and a half into the second Trump term, national and state data already show compounding declines in immigration flows.

  • After historically large increases during the Biden administration, net immigration to the United States has swung even more quickly in the opposite direction during the first year and a half of President Trump’s second term.
  • The Census Bureau estimates that net immigration fell 54 percent from mid-2024 to mid-2025, and projects that immigration could decline nearly 90 percent from its 2024 peak by mid-2026.
  • Separate Brookings Institution estimates suggest the country could experience a net loss of close to one million immigrants by the close of 2026.
  • State-level estimates suggest net international migration to Massachusetts also fell by more than half during the first six months of Trump’s second term. At the same time, the slowdown in net immigration is not yet translating into a large labor market collapse.
    Deportations remain relatively small compared to the total labor force; some federal policies are tied up in court; and certain immigration pathways have slowed rather than fully stopped. But small changes can compound quickly, and the medium-term outlook is considerably more concerning.

Several Massachusetts industries appear particularly vulnerable.

The labor force impacts are uneven across industries, but several sectors that are central to the Massachusetts economy appear particularly vulnerable.

Higher Education and Research

  • If current international student declines continue, Massachusetts could lose more than $1.4 billion in economic contributions in 2026/27.
  • During President Trump’s first term, his administration was five times more likely to deny high-skilled visas (H-1B) to Massachusetts companies, compared to Biden and Obama. If history repeats itself, these denials could lead to thousands of jobs being offshored from Massachusetts.

Healthcare Support

  • The uncertainty surrounding Temporary Protected Status (TPS), especially for Haitian workers, has emerged as one of the clearest short-term labor force risks cited by industry representatives. Many TPS holders provide direct care in nursing homes, hospitals, and work as home health aides. The Massachusetts Senior Care Association estimates that 40 percent of nursing facility workers in Massachusetts are foreign-born, including roughly 2,000 frontline workers with Haitian TPS status.

Construction

  • Immigrant workers, many of whom are undocumented, play key frontline roles building new housing in a state already facing severe housing shortages. Homebuilders described growing workforce instability and project delays resulting in large part from fear of ICE activity. While projects have not fully shut down due to the immigration crackdown, employers repeatedly warned that gradual labor force erosion can lead to delays and added costs that compound over time, particularly when combined with high interest rates and rising materials costs.

Gateway Cities, home to significant shares of immigrants and our future workforce, face challenges from immigration policy upheavals.

Gateway Cities increasingly serve as population hubs for immigrants, who are the foundation of the state’s future labor force. This means these cities are likely to feel most acutely the pressures created by rapid swings in immigration trends—whether toward expansion or contraction.

  • Gateway Cities are home to 25 percent of the state’s population, but to 40 percent of its foreign-born residents and over half of new arrivals.
  • We project that over the next decade, current children in immigrant families will make up at least one-third of all new labor force entrants in 17 of the state’s 26 Gateway Cities. In eight Gateway Cities, immigration will account for more than half of all new labor force entrants.
  • Rapid immigration increases from 2022 to 2024 created real pressures around housing availability and school capacity in many Gateway Cities, particularly those already facing constrained housing supply and limited fiscal capacity. Our analysis suggests immigrant housing demand was a modest factor in housing cost inflation, and the significant increase in resources the state has provided for English Language Learners has been critical aid to Gateway City school districts receiving these students. To continue welcoming large numbers of new Americans without creating large imbalances in housing and labor markets, Gateway Cities and other receiving communities will need more focused investment, including state and federal support in the future.

Topic

Economic Development