Lieutenant Governor Eleni Kounalakis Highlights New Report on Immigrants’ Critical Role in California’s Economy

 

For Immediate Release
Wednesday, June 25, 2025
Contact: Press@ltg.ca.gov, (916) 445-8994

 

SACRAMENTO, CA – Following a wave of alarming ICE raids in Los Angeles, a new report from the Bay Area Council Economic Institute sheds light on how shifting federal immigration enforcement raids and expanded immigration enforcement could impact California’s economy. The key insights below illustrate the role undocumented immigrants play in the state and the potential consequences of mass deportation policies.  

Earlier this month, President Donald Trump authorized a dangerous and unnecessary escalation in Los Angeles by deploying the National Guard and ordering sweeping ICE raids. These actions detained families, separated children, and terrorized communities across Southern California. The findings from the study below reaffirm the urgent need to defend immigrant communities in California and across the nation. They are the workers who feed us, the caretakers who support us, the entrepreneurs who drive innovation, and the neighbors who strengthen our communities. The ripple effects of mass deportation in California, the world’s fourth-largest economy, would be felt nationwide and beyond. 

 

“California’s strength lies in its diversity, and immigrants are the backbone of our economy, our workforce, and our communities. These ICE raids are not only cruel and unconstitutional, they’re economically reckless. Tearing families apart doesn’t just terrorize families and communities – it threatens billions in tax revenue, destabilizes key industries, and puts California’s position as the world’s fourth-largest economy at risk. In California, we don’t just tolerate immigrants – we defend them, because our future depends on it.”

Lieutenant Governor Eleni Kounalakis

California Is a State of Immigrants 

Immigrants make up almost one-third of California’s population, generating the labor, taxes, and businesses needed to power the largest state economy in the country.  

  • Immigrants make up over 27% of California’s population – more than any other state 
  • 1 in every 4 Californians is an immigrant 

 

Undocumented Immigrants Keep California Running 

To maintain its status as the fourth-largest economy in the world, California depends on the contributions of undocumented workers. 

  • Nearly 1.5 million of California’s undocumented individuals are active in the labor force, accounting for almost 8% of all workers in the state 
  • Undocumented immigrants in California have a labor force participation rate of over 72%, 5% higher than the rate for native-born residents 
  • Undocumented workers generate nearly 5% of California’s GDP  

 

What’s at Risk Without Undocumented Workers 

  • $275 billion in economic output 
  • $23 billion in annual tax revenue 
  • Thousands of workers in critical industries like agriculture, construction, and hospitality  

 

Mass Deportation Impacts Across Industry Sectors 

Undocumented immigrants comprise a significant share of the workforce in frontline and essential roles that keep California running, especially in key sectors such as agriculture and construction.  

  • Over a quarter of the state’s agricultural workforce is undocumented, and nearly two-thirds are immigrants of any status 
  • Without undocumented workers, GDP generated by California’s agriculture industry would contract by 14% 
  • 61% of construction laborers are immigrants, 26% of whom are undocumented 
  • Without undocumented workers, the construction sector’s GDP would shrink by nearly 16% 

 

The full report can be accessed at the following link here.