TPS work permits raise jobs concern as employers face labor squeeze

TPS work permits jobs concerns are rising after The New York Times reported that about 350,000 recipients of Temporary Protected Status from Haiti and several other countries will lose work authorization on Monday. The near-term labor effect could be concentrated in health care, social services and construction, sectors that have mattered for recent U.S. payroll growth, according to an Econbrowser analysis using Bureau of Labor Statistics data.

The New York Times said the change is the first wave of fallout from a Supreme Court ruling. The newspaper also reported that about 190,000 Salvadoran beneficiaries could be next when their status expires in September.

Alexander Arnon, director of policy analysis at the Penn Wharton Budget Model, told The New York Times that the loss of legal work authorization for tens of thousands of workers would be “a very big hit” for particular places and industries. Penn Wharton Budget Model is a nonpartisan research organization that has analyzed the economic impact of TPS workers.

How could TPS work permit losses affect jobs?

In the reported context, TPS is the status under which affected immigrants hold legal authorization to work in the United States. If that authorization ends, employers can no longer legally employ those workers, reducing the available labor force rather than lowering payrolls through weaker demand alone.

That distinction matters for interpreting employment growth. Econbrowser argued that one explanation for a slower “new normal” in job gains is weaker labor force growth, not only deficient aggregate demand. A smaller pool of legally available workers can limit hiring even when employers still have demand for labor.

The New York Times linked employer concern to the loss of protected status for immigrants already in the workforce. Econbrowser said those developments come on top of the Trump administration’s broader crackdown on migrants, which it said would add pressure to labor supply.

The sectors singled out in the analysis were health care and social services, and construction. Health care and social services have been a main contributor to employment gains over the past year, according to Econbrowser’s reading of BLS payroll data. Construction was also identified as exposed to the policy shift.

The payroll chart cited by Econbrowser tracks changes since January 2025 in total nonfarm employment, health care and social services, construction, and the rest of nonfarm payrolls. The data are seasonally adjusted and sourced to the Bureau of Labor Statistics, with calculations by Econbrowser.

For investors and policymakers, the mechanism is straightforward: immigration status rules can affect labor supply directly by determining who may lawfully work. If a large number of people lose authorization in a short period, affected employers may face vacancies, slower hiring or operational strain, with the impact varying by region and industry.

The available reports do not quantify how many jobs will be lost, nor do they establish how employers will respond. They do show that the end of work permits for hundreds of thousands of TPS recipients has become a labor-market issue, especially in industries that rely on steady staffing.

This story draws on original reporting from Econbrowser.