America’s Workforce Shifts Towards More Native Participation

Recent job reports show a notable decline in the foreign-born workforce over the last year, indicating that President Trump’s stricter immigration policies are altering the landscape of the U.S. labor market.

According to the Labor Department’s data released on Thursday, the number of foreign-born individuals in the labor force dropped by 700,000, down to 31.9 million from 32.6 million since last June. Similarly, the foreign-born civilian population also fell, decreasing by 571,000 from 49.1 million to 48.6 million.

This trend is quite a turnaround from the previous years, particularly during the Biden administration, when a surge in immigration had contributed to a rapid increase in the foreign-born workforce. The latest figures suggest that the Trump administration’s border enforcement measures are beginning to reverse that trend.

Interestingly, the gender dynamics reveal further nuances. The number of foreign-born men in the civilian population dropped by 1.14 million over the year, with a decrease of 970,000 in the labor force and 812,000 in employment among foreign-born men.

In contrast, foreign-born women have seen an increase. Their civilian population grew by 568,000, with a rise of 271,000 in the labor force and an increase of 305,000 in employment. This might imply that the impact of Trump’s immigration crackdown is less felt in sectors dominated by women, like child care and health care, compared to sectors where foreign-born men are more prevalent.

The native labor force also saw a decline over the past year, decreasing by 445,000 to 138.3 million, largely due to retirements among older Americans. However, the native-born civilian population actually increased by over 2.1 million.

Employment trends have mirrored these shifts; while native-born men saw a reduction in employment by 962,000, employment for native-born women went up by 308,000.

Ultimately, the labor market is increasingly composed of homegrown talent, even as the overall growth in the labor force has decelerated. The share of foreign-born individuals in the workforce fell from about 19.0% in June 2025 to 18.7% in June 2026.

This shift could be seen as a positive sign for American workers. For a long time, businesses enjoyed a large influx of foreign workers, particularly men, which expanded the workforce and eased competitive pressures associated with attracting foreign labor. This situation has helped maintain low-wage business models.

Now, however, this trend seems to be reversing. Employers may have to depend more on domestic workers, focus on retention efforts, and invest in productivity improvements instead of simply drawing from an increasing pool of imported labor.

It’s worth noting that the Department of Labor’s data doesn’t distinguish between different categories of foreign-born individuals, including temporary visa holders or naturalized citizens; they are all categorized as “foreign-born.” The decline in the foreign-born labor force is likely influenced by a combination of reduced illegal immigration and the halting of new illegal entries.

The unemployment rate fell to 4.2% in June, suggesting that those who wish to work in the U.S. are increasingly finding it difficult. Meanwhile, the non-seasonally adjusted foreign-born unemployment rate went down to 3.6%, owing to a decrease in the participation rate, which reflects the share of the population actively involved in the labor force.