People participate in a "No Kings" protest in Pasadena, California, the United States, June 14, 2025. (Photo by Zeng Hui/Xinhua)

California is reeling from the economic aftershocks of sweeping federal immigration raids that began in early June. Business owners, labor leaders and civil rights advocates warn that the pace of damage has accelerated in recent weeks.

The Bay Area Council Economic Institute estimated in a June analysis that roughly 2.3 million undocumented residents -- about 8 percent of California's labor force -- contribute nearly 278 billion U.S. dollars to the annual gross domestic product (GDP). Removing them, the study concluded, would erase almost 9 percent of state output and shrink consumer spending by a similar share.

Those numbers now feel conservative. Speaking at Wednesday's webinar, "The Economic Impact of Mass Deportation in California," George Carrillo, CEO of the Hispanic Construction Council, a national nonprofit organization, said that worksite arrests have already delayed projects and pushed statewide construction completions down by 22 percent since January.

"If you hobble construction, you hobble every sector that depends on new homes, hospitals and roads," Carrillo said. The council calculates that 26 percent of California construction laborers lack legal status.

The agriculture industry, which employs more than 480,000 field workers during peak harvests only weeks away, faces the same squeeze.

Bryan Little, senior director of the California Farm Bureau, said that growers are "scrambling to fill crews" and leaving delicate crops unpicked, a shortfall he warned will drive food prices higher nationwide.

The fallout extends far beyond payrolls. Community lawyer Huy Tran recounted how a single raid in East-Side San Jose cut commercial foot traffic by 30 percent almost overnight. In Kern County, school districts reported a one-fifth drop in attendance during January field operations, according to data presented by Stanford researchers.

Protesters confront the California National Guard soldiers in front of a federal building in downtown Los Angeles, California, the United States, on June 9, 2025. (Photo by Qiu Chen/Xinhua)

Rights advocates argue that such tactics threaten basic civil liberties. Tran described "roving patrols" of immigration agents and National Guard troops detaining residents based solely on appearance -- a practice a federal judge deemed discriminatory. The U.S. Department of Justice has appealed, and deployments continue while the case moves forward.

Congressional Republicans have bolstered the administration's crackdown with new funding. The House budget earmarks 185 billion dollars for U.S. President Donald Trump's mass-deportation agenda -- a figure 80 times the federal support Los Angeles receives for its worker-retraining programs.

Economists caution that the losses will not stop at state lines.

California is a net contributor to the U.S. Treasury, and every undocumented household removed drains income tax revenue while driving up labor costs across the country. Moody's Analytics projects that nationwide produce prices could climb by as much as 7 percent if California harvests falter.

At ground level, fear is reshaping daily life. Parents keep children home, patients avoid hospitals, and witnesses stay away from courtrooms, making it harder to prosecute crimes. "The trauma lingers," said an advocate at Wednesday's webinar who was once detained during a raid. "You never know when they will come back."

Carrillo urged business groups to push immigration reform rather than "quiet compliance." Yet many remain wary.

"We are neighbors; our kids play together. It's time to stand up," he told the webinar.

For now, California, whose economy would rank fourth in the world if it were a nation, must navigate wildfire recovery, housing shortages, and aging infrastructure with a shrinking workforce and communities gripped by anxiety. The longer the deportation drive continues, analysts said, the harder it will be to rebuild what fear has already taken away.