The Economy Under Trump: Immigration ICE Raids Killing Off Jobs, Hurting Small Businesses

A possibly unanticipated side effect from President Donald Trump's executive order on immigration was all but confirmed Tuesday: small businesses in states where immigration raids have been taking place were suffering as most of their clientele was made up of undocumented immigrants. The demographic targeted by the Department of Homeland Security's U.S. Immigration and Customs Enforcement (ICE) agency has been keeping a low profile to avoid being detained and ultimately deported.

"We're seeing more cases of people reluctant to patronize the stores they were going to," Mark Arabo, a small business owner in San Diego told CNBC Tuesday. "It's fear for ICE and it's fear for the government."

Trump signed an executive order in January which was supposed to target undocumented immigrants in the U.S. with a history of violent crime. The effect on businesses experiencing a dwindling number of customers was felt nearly instantly, forcing owners to take drastic measures to save their small businesses.

"Some are cutting across the board 20 to 30 percent," Arabo added. "It's not a good thing for the economy. It's not a good thing for jobs."

The executive order targeted undocumented immigrants "who illegally enter the United States and those who overstay or otherwise violate the terms of their visas present a significant threat to national security and public safety," but reports have indicated that recent ICE raids were increasingly going after people who did not have a criminal history. That strategy was a decided shift from the one employed by former President Barack Obama, who deported more people than any other president.

Trump's immigration policies will likely prove costly to the U.S. economy, according to an op-ed in al Jazeera published Sunday.

"Though framing the US labour market in terms of simplistic cause and effect may be a sound political tactic, the argument that deporting undocumented immigrants en masse will be good for the American jobs market is fundamentally unsound," Patricia Sabga, an economics and global affairs journalist, wrote.