Labor: the ICE chilling effect gets quantified
Archive story from the 2026-07-16 edition. This is the reporting as filed; source publication and event dates may differ. Check the dated storyline for subsequent developments.
An NBER paper estimates seven workers leave construction employment for every one detention, against a 349,000-worker shortfall.
An NBER paper now finds ICE enforcement measurably cut construction labor supply. The chilling effect is estimated at 7+ workers leaving employment for every 1 detention. The industry needs 349K to 500K workers in 2026; 45% of contractors had at least one delayed project. Separately, ABC's construction backlog indicator slipped in June though contractors stayed confident.
Why it matters
Your subs come from drywall, roofing, and plaster, the trades that are 60%+ immigrant. Peer-reviewed evidence of supply contraction is ammunition for the labor-rate argument you're already having with carriers.
Our assessment
A peer-reviewed labor paper feels like something to nod at and move past. It is ammunition. Seven workers leaving for every detention is a number you can put in front of an adjuster who still prices drywall labor like it is 2019. Attach the citation and three local wage quotes to your next labor supplement, and stop arguing the rate from memory.
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Trade press / Association High confidence at publication