Population Slowdown Could Deliver $100 Billion Hit to U.S. Economy
Key Points
- U.S. population growth slowed to 0.4% in 2025, the slowest rate since the global Covid-19 pandemic.
- That slowdown in population means fewer consumers, which limits demand and spending.
- About 1.3 million net new immigrants became U.S. residents from July 2024 to June 2025, less than half of the 2.7 million recorded during the same period a year prior.
U.S. population growth slowed dramatically last year, and that could create a more than $100 billion drag on the economy, a new analysis contends.
U.S. population growth has slowed significantly with an increase of only 1.8 million, or 0.5%, from July 2024 to June 2025, the U.S. Census Bureau reported in January. That means for the full year, the U.S. grew by only 0.4%, the slowest rate of population growth the country has experienced since the Covid-19 pandemic.
That slowdown in population means fewer consumers, which limits demand and spending, according to an analysis published Wednesday by Implan. The economic impact modeling firm noted that the U.S. experienced a significant increase of approximately 3.2 million people from July 2023 to July 2024. In 2025, that dropped to just 1.8 million, leaving a “growth gap” of 1.4 million fewer people, which reduced household spending by $86.2 billion.
Implan estimates that erasing over one million potential consumers resulted in $103.9 billion in forgone gross domestic product growth and about 741,500 fewer jobs than if growth maintained its 2024 pace. While that is a significant impact, it’s still only a fraction of the U.S. economic activity given that GDP hit $31.098 trillion in the third quarter. The Bureau of Economic Analysis is set to release fourth quarter estimates on Feb. 20.
The latest analysis projected that the biggest hits from slowing population growth will come to the housing and healthcare sectors. “Population growth is the primary engine for residential construction and healthcare demand,” noted Nadège Ngomsi, the report’s author and an economist at Implan. She added that restaurants and dining could see spending and labor impacts as well.
California, New York, and Texas are projected to feel the biggest economic shocks. California will likely be the hardest hit, with Implan projecting $13.4 billion in forgone GDP and 86,520 fewer jobs in the state.
The slowdown in population growth is largely due to a historic decline in the net number of people coming to live in the U.S., Christine Hartley, assistant division chief for Estimates and Projections at the Census Bureau, said in a statement. “With births and deaths remaining relatively stable compared to the prior year, the sharp decline in net international migration is the main reason for the slower growth rate we see today,” Implan reported.
About 1.3 million net new immigrants became U.S. residents from July 2024 to June 2025, less than half of the 2.7 million recorded during the same period a year prior. A Congressional Budget Office estimate found that net immigration amounted to 410,000 in all of 2025.
Census projects that if current trends continue, net international migration will be just 321,000 for the full year of 2026. That would be a decline of nearly one million migrants compared with the prior year.
And net immigration could be even lower. Oxford Economics cut its 2026 forecast to just 160,000 from 350,000 due to the further restrictions, mostly on legal migration. The Trump administration’s decision to suspend processing immigration visas for nationals of 75 countries is especially impactful, considering that nearly half of all immigrant visas issued from abroad in 2024 came from these countries.
To be sure, estimates of the effects of slower population growth and reduced immigration vary. Joint research published by the Brookings Institution and the American Enterprise Institute last month noted that reduced migration likely only resulted in “modest damping” effects on GDP. Researchers expected the lower immigration to weaken consumer spending by $60 billion, to $110 billion combined in total for both 2025 and 2026.
“While this slowdown is driven by a complex mix of lower birthrates and a sharp decline in international migration, the economic implications are immediate and tangible,” Ngomsi said.