Heightened federal immigration enforcement activity in California coincided with a workforce downturn that surpassed the Great Recession, a new UC Merced analysis has found.

The UC Merced report used U.S. Census data to track changes in the number of Californians reporting private sector employment across several months in 2025.

Between the week of May 11 and the week of June 8, the period when federal immigration enforcement activity escalated in Los Angeles and other parts of the state, Californians reporting private sector work dropped by 3.1% — roughly 465,000 fewer workers.

That decline grew further in subsequent months, with a 4.9% decrease by the week of July 6, about 742,492 fewer workers. Even after a partial rebound in August, employment remained 2.9% below May levels by early September.

“There’s really nothing like it on record in the last 50 years, except for the onset of the COVID pandemic,” said Edward Flores, faculty director for the UC Merced Community and Labor Center. “Even during the first year of the Great Recession, job losses of that magnitude happened over an entire year — not in a single month.”

In contrast, the rest of the United States saw only modest changes in private-sector work over the same period.

The data show that U.S. citizens accounted for the majority of the numerical drop in private sector workers between May and July, although lasting effects through August and subsequent decline in September impacted noncitizens far more.

“With each wave of heightened federal immigration enforcement, we see consequences for both citizens and noncitizens,” Flores said. “Because there are more citizens in the workforce, the numerical job loss is larger among them. But the lingering effects are greater among noncitizens, whose employment levels don’t rebound in the same way.”

From May to June, women experienced large declines in reported employment, according to the report, reflecting their concentration in service sector work that depends heavily on robust economic activity.

In the Fresno area, the most recent data from the California Employment Development Department shows that the unemployment rate was 7.5% in September, down from a revised 7.9% in August, but still higher than the 6.7% rate recorded a year earlier. The region continued to lag behind California’s unadjusted unemployment rate (5.6%) and the national unemployment rate (4.3%).

Within the metro area, Fresno County’s unemployment rate stood at 7.5%, while Madera County posted a slightly lower rate of 7.0%, underscoring persistent employment challenges in the Central Valley despite modest month-to-month improvement.

Between August and September 2025, total industry employment in the Fresno area rose by 400 jobs, reaching 504,900 jobs overall, according to the latest figures. The monthly gain was driven entirely by nonfarm employment, which increased by 2,700 jobs, while farm employment fell sharply by 2,300 jobs, a 3.8% decline.

Government employment led job growth, adding 3,300 positions, with most of those gains concentrated in local government educational services, which grew by 2,900 jobs as schools returned to full staffing. Private education and health services was the only other major sector to post gains, adding 900 jobs, including 600 in private educational services and 300 in health care and social assistance.

Job losses were recorded across several industries, with leisure and hospitality, construction, and other services each shedding jobs, down by 400, 400, and 300 positions, respectively, highlighting continued unevenness in the region’s labor market.

Researchers say the economic effects extend beyond simple job counts. Anecdotal reports from California businesses during the enforcement period described workers failing to show up and customers avoiding public places out of fear, which can depress consumer spending and stall local economic activity.

“If people aren’t working and earning money, they’re not spending,” Flores said. “That has downstream effects — it affects local businesses, local tax bases, and families’ ability to pay their bills.”

Flores noted that in earlier crises — such as the Great Recession and the pandemic — federal responses included large-scale stimulus and disaster relief. No comparable package of economic support has emerged this time, despite the severity of the downturn.

“When undocumented immigrants work, employers pay taxes on their behalf, but they cannot access unemployment insurance,” Flores said. “That’s been the case since 1976. When families can’t work and can’t pay their bills, it affects their children and their local economies.”

One policy proposal gaining attention is expanding California’s unemployment benefits system to include undocumented workers, who currently pay taxes but are ineligible for benefits. Flores has argued that this could help stabilize low-income communities and support broader economic resilience.

Despite unanimous passage of Senate Bill 227 (SB 227) in both chambers of the California legislature in 2022 and 2024, which would have extended unemployment benefits to undocumented workers, the measure was twice vetoed by Governor Gavin Newsom.

The UC Merced report argues that state leaders may need to consider economic stimulus and disaster-response strategies when federal immigration enforcement intensifies. Flores explained how support for low-income households can have ripple effects across communities.

“When low-income workers spend money, they spend it locally — on food, child care, and necessities,” he said. “That creates a domino effect that stimulates the local economy and helps prevent further decline.”

As Californians move through the holiday season, Flores said the findings are also a reminder of the human cost behind the data.

“There are people who have been displaced, deported, or pushed into economic hardship,” he said. “This isn’t just an economic issue — it’s about how we care for each other and the communities we live in.”

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