Ana Valdez is President and CEO of the Latino Donor Collaborative, a leading producer of economic data on the U.S. Latino Cohort.
From workforce staffing disruptions to input cost increases, businesses are facing growing uncertainty. Small businesses, already vulnerable due to labor shortages, now face dual pressures: a shrinking labor force and rising costs from global tariffs. The result could be an economic slowdown with long-term implications for productivity and growth.
U.S. Labor Shortages Meet Workforce Contraction
Across industries, from agriculture and healthcare to construction and hospitality, employers continue to report significant hiring gaps. In 2024, there were around 8 million open jobs, and in many cases there were not enough qualified or willing workers to fill them. A 2025 survey revealed that 58% of executives are concerned that tighter immigration enforcement will worsen these shortages, particularly in sectors already dependent on a reliable, service-oriented workforce.
Many of these roles are filled by U.S. Latinos, including undocumented workers who have become indispensable in high-demand industries. Policies that disincentivize or drive out large segments of this group risk creating economic gaps that may be difficult to backfill in the short term.
Simultaneously, a separate but equally impactful policy shift has placed small businesses under financial pressure. Although there is now a 90-day pause on certain tariffs, a recent Wall Street Journal report revealed how previously proposed 145% tariffs (registration required) on Chinese imports were already threatening the survival of countless small enterprises.
Small businesses often operate with narrower margins, minimal supply chain flexibility and limited cash reserves. Many rely on a single manufacturer or imported inputs that cannot easily be replaced domestically. For instance, as noted by the Wall Street Journal, one Colorado tent manufacturer had to cut production in half and lay off staff due to soaring fabric costs. Another company received an $8,752 tariff bill on a $5,649 order, instantly erasing profit margins. While the temporary pause may offer short-term relief, uncertainty remains.
This is not just a trade story—it’s an economic warning sign. Even with the temporary pause, abrupt policy changes have left some business owners tapping into personal savings, postponing expansions and in some cases, closing altogether. These closures don’t just impact individual families; they affect entire local economies and supply ecosystems.
The Workforce And Consumption
Amid these challenges, the Latino community continues to be a cornerstone of U.S. economic growth and a solution to many of our most pressing challenges.
As my organization found in our “2025 Official LDC U.S. Latino GDP Report,” the U.S. Latino GDP has surpassed the $4 trillion mark. We also found:
• Latino purchasing power—the most comprehensive metric of purchases made by and on behalf of Latinos, including investments and government spending—has grown even higher at $4.1 trillion.
• Latino-owned businesses employ 3.5 million workers.
This economic activity drives growth in industries from retail and automotive to housing and hospitality.
In addition, a report published in 2016 notes that 94% of Latinos under 18 are U.S.-born, and the majority speak fluent English, underscoring that Latinos are not a transient or external group; they are deeply embedded in the American economy, workforce and future.
The Business Imperative For Growth
As economic stakeholders, employers, investors and nonprofit institutions, we can advocate for solutions grounded in data. We can encourage collaborative approaches that support the domestic economy. We can support tariff strategies that incentivize innovation without punishing the smallest players. We can also support policies that recognize labor as a strategic asset, not a liability.
Business growth is fueled by workforce expansion, not contraction. This requires economic pragmatism, which means supporting transitional solutions for small businesses and modernizing our workforce policies to match today’s realities.
The data is clear: Latinos are a foundational component of American prosperity. Workforce growth, consumer demand and entrepreneurial dynamism all benefit from Latino engagement. Any policy, whether focused on immigration, trade or labor, that reduces the participation of this group in the U.S. economy could risk significant negative consequences.
The Latino community, which is predicted to account for 78% of all net new workers between 2020 and 2030, is not just part of America’s story—it is the future of American prosperity. The real question is: Will we choose to build that future on solid economic fundamentals or on short-term thinking?
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