Immigration Enforcement and Local Business Dynamics

This paper examines the effects of interior immigration enforcement on local business dynamics. Exploiting the federally determined rollout of the Secure Communities (SC) program across U.S. counties, we use county-sector-year Census administrative data to show that enforcement reduces establishment entry and job creation, with no significant effect on exit or job destruction. We provide evidence consistent with a labor supply mechanism: SC activation reduces the immigrant population, raises wages, and generates larger effects in immigrant-intensive and high-turnover sectors. The decline in job creation is driven by continuing establishments adjusting along the intensive margin rather than exiting.