In January, newly elected President Donald Trump made a bold statement about U.S.-Latin America relations to the members of the press:

“Great. They need us much more than we need them. We don’t need them. They need us—everybody needs us.”

His blunt and triumphalist remark spread quickly from the Oval Office to the rest of the world and sparked a heated debate, especially in the context of his administration’s aggressive anti-immigration policies. But despite Trump’s dismissal of the importance of Latinos the economic ties between the U.S. and Latin America are undeniable and deeply rooted. From trade agreements to a labor force sustaining key industries like agriculture, construction, healthcare, and technology, U.S. economic growth heavily depends on Latino labor and entrepreneurship. Mass deportations and restrictive immigration policies don’t just impact undocumented workers; they threaten entire industries, slow economic growth, and create labor shortages that affect all Americans. 

In this article, we’ll break down the indispensable role of Latinos in the U.S. economy now and in the past, how immigration policies are reshaping the workforce, and why the country’s success is intricately linked to the contributions of Latino workers, business owners, and innovators.

U.S. Economic Power Has Long Relied on Latin America

Contrary to popular belief, the rise of the United States as a world power was not achieved in isolation, but was due to its imperialist practices and constant interventions in the southern region of the continent. Since the Latin American colonies gained independence from the Spanish Crown, the United States has carried out numerous interventions in the region throughout the 19th and 20th centuries justified by the Monroe Doctrine, Manifest Destiny, and Operation Condor. These actions included military interventions, support for coups d’état and the imposition of economic policies favorable to the United States’ interests.

The imperialist practices carried out by the U.S. allowed access to natural resources, markets and cheap labor, which led to its economic growth and consolidation as a superpower. This means that Donald Trump’s homeland hasn’t succeeded solely on its own merits, but on a structural dependence of Latin American economies, severely shaped to serve its interests.

Nowadays, trade between the United States and Latin American countries forms a cornerstone of economic relations. According to the Economic Commission for Latin America (ECLA)—the Spanish acronym is CEPAL, in 2023 Latin America and the Caribbean accounted for 21.3% of the U.S.’s total trade in goods, amounting to approximately $1.097 trillion. Mexico emerged as the top trading partner, representing about 16%, a robust exchange which includes agricultural commodities and manufactured goods.

Latino Labor and Innovation Keep Essential Industries Running

The Latino community plays a vital role across many sectors of the United States economic landscape. However, despite being in a wide range of industries, they are most likely to work in traditionally low paying ones (tasks others tend to not want to perform.) For instance, according to a 2016 report by the Center for Economic and Policy Research, 10.4% of Latinas work in the food services industry, followed by a 7.3% in elementary and secondary schools, and a 4.9% in healthcare facilities. The U.S. economy has much to appreciate Latinas' hard work, which has contributed to the country’s GDP a whopping $1.3 trillion dollars in economic output in 2021, which represents a 50% growth in just a decade, surpassing the economy of the state of Florida. This means that Latinos are present in everyday life, taking charge of feeding, healing, supplying and educating the U.S. population.

47.8 million immigrants paid $651.9 billion in taxes in 2023 according to the American Immigration Council in 2023 and $59.4 billion paid by undocumented in federal taxes.

There’s also a common xenophobic narrative shared by Trump according to which immigrants are “taking” American jobs and do not pay taxes. This can easily be challenged by official data. For example, the National Bureau of Economic Research has concluded that immigrants are 80% more likely to start businesses than people born in the U.S. Besides, the Center for American Entrepreneurship stated that almost half of Fortune 500 companies were founded by first or second generation immigrants. This means that Latino and Latina entrepreneurs are a driving force in the economy, generating value and creating new jobs for all. As for taxes, the country's 47.8 million immigrants paid $651.9 billion in taxes in 2023 according to the American Immigration Council in 2023 and $59.4 billion paid by undocumented in federal taxes.

Immigration Crackdowns Are Hurting the Economy

Recent anti-immigration measures have introduced significant challenges for Latino families. The heightened deportation efforts led by the Immigration and Customs Enforcement (ICE) have instilled fear among undocumented workers and have deterred them from seeking employment. This reluctance exacerbates existing labor shortages, particularly in construction, where 17.5% of Latin men work according to the CEPR report mentioned above. A decrease in labor is expected to have a direct impact on housing developments, which will worsen the housing crisis even more in regions like California. 

On the other hand, analysts are already trying to predict the long-term economic ramifications of mass deportations. A report from the University of New Hampshire shows that past deportations have negatively impacted U.S. workers, leading to job losses and lower wages. Between 2008 and 2015, the removal of approximately 454,000 undocumented immigrant workers resulted in a 0.5% decline in the employment rate among U.S.-born workers and a 0.6% drop in their hourly wages. 

This report predicts that current large-scale deportations will shrink the U.S. economy even more, with an economic contraction that could range from 2.6% to 6.2% of the GDP. A decrease of this caliber would amount to the loss of between $711 billion and $1.7 trillion. Besides, job losses due to mass deportations could reach up to 3.6% of total employment. Not only does this affect Latino workers, but will cause a decrease in labor supply, a reduction of consumer spending, and the disruption of industries heavily reliant on Latino workers.

Time for Policy to Reflect Economic Reality

Hard data regarding Latinos in the workforce helps us unveil Donald Trump’s xenophobic remarks as ignorant and uninformed. Recognizing the vital role of Latino innovators and workers isn’t just about setting the record straight it’s about ensuring policies reflect the reality of an economy that thrives on their contributions. As discussions on immigration and labor policies continue, it’s crucial to support reforms that protect and empower the workforce that keeps the U.S. running strong.