U.S. Immigration and Customs Enforcement actions are disrupting the construction industry in South Texas.
Builders attribute it to a previous period of large-scale deportations as a warning of pending economic consequences.
Industry leaders say arrests at or near construction sites have caused many workers to stay home, slowing projects and tightening labor availability across the Rio Grande Valley.
ICE has arrested more than 9,100 people in South Texas since President Donald Trump took office, nearly one-fifth of related arrests statewide during that period, according to ICE data obtained through a public records request and analyzed by the Texas Tribune.
Mario Guerrero, executive director of the South Texas Builders Association, said concerns escalated after he viewed video of ICE agents detaining workers at a construction site in the region.
Builders say the resulting labor shortages have slowed construction activity and could push housing costs higher as supply falls.
Federal Reserve Bank of Dallas data shows construction employment in the Rio Grande Valley declined 5% during the third quarter, the largest job drop among sectors in the region.
More than 380 people from the construction and development industry attended a meeting in Pharr to discuss the impact, including contractors, suppliers, real estate professionals, and lenders.
Ronnie Cavazos, president of the association's board, said continued enforcement-driven labor shortages could force businesses to close.
Isaac Smith, co-owner of Matt's Building Materials, said sales have dropped at a double-digit rate, and late payments have increased as construction slows.
Builders and economists have pointed to a similar period during the 2008 to 2013 timeframe, when immigration enforcement intensified.
The government's Secure Communities program was launched during the administration of former President George W. Bush and expanded under former President Barack Obama, leading to more than 300,000 deportations nationwide during that period.
Researchers found that the enforcement effort reduced construction labor by 2% to 3% nationwide and led to a 5.7% decline in new home construction.
The reduced supply of housing contributed to an average home price increase of 4.4%, according to research led by University of Wisconsin business professor Dayin Zhang.
Zhang said the historical data show how immigration enforcement can directly affect housing markets by shrinking the labor pool needed to build homes.
He said current enforcement levels could result in more severe labor shortages than those seen during the Secure Communities era, depending on the total number of deportations.
Since raising concerns publicly, Guerrero has met with state and federal leaders, including Rep. Henry Cuellar, D-Texas, and Republican Gov. Greg Abbott, to discuss the economic impact on the region.
Jim Mishler ✉
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