Trump’s grand plan to put American workers first may be backfiring as U.S.-born unemployment rises and wage growth stalls

President Trump was clear in his pitch to voters: In 2024, he pledged to bring back the American Dream.

Removing immigrants “ taking jobs from American workers and driving down their wages” was a key part of the plan.

A few years later, the effects of this policy are now visible in the labor market.

January data from the Census Bureau showed an historic decline in net international migration, down from a peak of 2.7 million people in 2024 to an estimated 321,000 by mid-2026.

Brookings puts that figure even lower , saying the U.S. could see negative net migration this year.

Economists previously told Fortune that this changing pattern has helped stabilize the U.S. unemployment rate as demand has dropped over the past few years, with the rate holding steady at 4.1% in the latest data .

But Mark Zandi, chief economist at Moody’s, recently noted foreign-born unemployment fell below native-born unemployment in October 2025, based on analysis of a 12-month moving average of seasonally unadjusted data.

The drop in foreign-born unemployment is relatively easy to explain, Zandi tells Fortune : The immigrant labor force is shrinking because of White House policy, and unemployment for the demographic is relatively lower as a result.

The rise in native-born unemployment is more complex.

A major driver is that demand for labor has generally fallen, Zandi tells Fortune —so it stands to reason that if U.S.-born workers now make up a larger share of the labor force, this cohort would be affected more heavily by changes in demand.

But there’s also the issue that the careers and wages immigrant workers have been willing to commit to aren’t viewed in the same way by native workers.

The Bureau of Labor Statistics writes that in 2025, foreign-born workers were more likely than native-born workers to be employed in sectors like construction, trucking, and natural resources, as well as health and personal care.

The median weekly earnings of foreign-born, full-time wage and salary workers are also lower—immigrants earn 85.7% of the pay earned by their native-born counterparts, the BLS notes.

President Trump’s theory is being tested: It seems even if native-born Americans face reduced competition for roles, they don’t want the jobs anyway.