Some Texas businesses are grappling with the effects of the Trump Administration’s crackdown on immigration, according to a new survey by the Dallas Federal Reserve .

About 13% of businesses said their ability to hire immigrant workers has been impacted by recent immigration policy. Among those businesses, their top two cited reasons were difficulty finding workers who have work permits and a reduction in the number of foreign-born applicants.

Of those, 48% of the businesses said they increased hours for existing employees in response to difficulty finding workers; 38% said they increased wages or benefits.

The Dallas Fed asked businesses in February if they expect immigration policy to impact their ability to hire and retain workers – 18% of businesses said yes.

Forty three percent of the businesses hiring this July said a lack of available applicants was the biggest hurdle to hiring new workers. With an unemployment rate of 4% in Texas , many businesses are going to have a smaller pool of applicants without immigrant labor.

Chad Pearson, University of North Texas assistant professor and labor historian, said businesses have historically been pro-immigration as it gives them access to cheaper labor. When there’s more applicants for a job, businesses have more leverage to offer lower wages as applicants compete against each other to get the job.

The Fed survey allows businesses to submit comments, allowing direct insight into business executive’s thoughts. Three of the comments directly said they are just not hiring foreign-born workers. Something Michael Maslanka, associate professor at UNT Dallas’ College of Law, said is illegal.

While many of the survey responses – which are anonymous – cited uncertainty over visas being revoked, Maslanka said not hiring someone born outside the U.S. violates the Civil Rights Act of 1964, which prohibits discrimination based on national origin.

Some comments noted productivity and customers decreased when there were rumors of a raid by Immigration and Customs Enforcement officers. ICE raids have become more public and frequent as the agency aims to deport millions of people by the end of Trump’s term.

Trump’s “One Big Beautiful Bill” gave ICE $75 billion in extra funding, making it the most well-funded law enforcement agency in the federal government, according to CBS .

The Trump Administration has framed immigrants without legal status as violent criminals invading the country.

“Many of these aliens unlawfully within the United States present significant threats to national security and public safety, committing vile and heinous acts against innocent Americans,” Trump said in a January Executive Order . “Others are engaged in hostile activities, including espionage, economic espionage, and preparations for terror-related activities.”

But a study funded by the Department of Justice’s research agency found immigrants are arrested at less than half the rate of native-born citizens for violent and drug related crimes. The study, released in September 2024, reviewed Texas criminal records from 2012 to 2018. That study appears to have been removed from the agency’s website as part of a purge of federal websites the Trump Administration began doing in January 2025 .

The Fed survey concluded that in addition to the companies that said their ability to hire immigrant workers has already been impacted, 7% said they expect immigration policy to impact their hiring ability later. Of those companies, 42% said they plan on using automation and AI to help fill the gap, and plan to hire more U.S. born workers or legal permanent residents.

Dylan Duke is KERA’s summer 2025 SPJ news intern. Got a tip? Email Dylan Duke at dduke@kera.org.

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