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Immigration raids at construction sites across the state are hurting the economy, driving up housing costs, hurting development and delaying projects, according to builders, lenders and South Texas business leaders.
They say the problem is targeted Immigration and Customs Enforcement raids are forcing workers to avoid work sites — even if they are citizens or have documents to work.
Mario Guerrero, executive director of the South Texas Builders Association, said companies in the supply chain are reporting sharp revenue declines, with some businesses filing for bankruptcy.
He and other builders argue the slowdown is now visible in financing as well: Guerrero said construction loans in the region are down about 30% over the past year.
Monica Martinez, with the Laredo Chamber of Commerce, said contractors are reporting labor shortages, delayed schedules and rising costs —pressures she said can chill economic development projects as timelines stretch and bids rise.
South Texas Democratic Rep. Henry Cuellar said he has heard similar complaints from colleagues in other parts of the country, calling it “a national problem.”
Cuellar said he is asking federal officials to back off construction sites the way, he says, they did after agricultural employers warned raids were harming planting and harvest operations.
“I want Americans to have the job first,” Cuellar said, “but we know the reality. There’s not enough Americans to fill certain jobs.”
Rio Grande Valley Republican Rep. Monica De La Cruz is calling the ICE raids at construction sites a crisis for builders, according to the Rio Grande Guardian.
The concerns in South Texas mirror what national industry groups and economists have been tracking for months: construction is unusually dependent on immigrant labor, and even the perception of heightened enforcement can reduce turnout on job sites.
A recent Federal Reserve Bank of Dallas analysis found immigration policy changes and intensified enforcement can curb labor supply through multiple channels creating a “chilling effect” in immigrant communities that makes people more likely to miss work or avoid public spaces.
Nationally, the National Association of Home Builders has warned members about jobsite raids and advised employers to ask for warrants and contact counsel if agents arrive.
In Texas’ largest metros, foreign-born noncitizens make up a sizable share of the construction workforce — about 38.6% in the Houston area, according to U.S. Census Bureau.
Cuellar said he arranged meetings for the builders with ICE leadership and the White House, and that lawmakers are trying to add “guardrails” through the Homeland Security appropriations process — an effort complicated by the administration’s broader enforcement push and the competing demands of border security, labor markets and housing affordability.
