Restaurant owners across Texas are facing severe business losses as Immigration and Customs Enforcement operations intensify under the Trump administration, with many establishments reporting revenue drops of up to 40 percent as frightened Latino customers and workers stay away from Hispanic neighborhoods and businesses.
The Texas Restaurant Association revealed that 23 percent of its members lost employees in the second quarter of 2025, while 21 percent received fewer job applications and 16 percent experienced customer losses directly linked to ICE enforcement activities. These statistics underscore the broad economic impact of immigration raids on an industry that employs 1.4 million people statewide, with 22 percent of the workforce comprising immigrants.
"People Were Afraid to Go Out"
Oscar Garcia Santaella, a 54-year-old Mexican immigrant who operates several restaurants, including the Houston-area taco joint Los Primos, has witnessed firsthand the devastating effects of nearby ICE operations. When agents raided an apartment complex near his restaurant last month, business came to a standstill.
"They were there a week. And both that week and the next, we sold nothing. It was bad, because people were afraid to go out," Garcia told reporters, according to France 24's coverage.
One of Garcia's employees called to say she couldn't come to work because ICE agents had arrested her cousin during the apartment complex raid. "So yes, it is affecting us directly," Garcia said, noting that his sales have dropped 40 percent.
Industry Faces Critical Labor Shortage
The fear surrounding immigration enforcement has created, according to industry leaders, a crippling labor shortage. Jesus Sagrero, owner of Café y Tequila Mexican restaurant in Irving, reported that his clientele has dropped by 45 percent since the beginning of the year.
"There would be a lot of calls, people coming in, leaving their phone numbers, but ultimately, it's gone down a lot... those people aren't coming anymore asking for jobs," Sagrero explained to CBS News. "I imagine a lot of these employees and clients are not coming in because of the immigration raids that are happening across the country."
The Texas Restaurant Association reports that 47 percent of Texas restaurant operators currently have job openings that are difficult to fill, a situation exacerbated by the climate of fear surrounding immigration enforcement.
Back-and-Forth Policy Creates Uncertainty
The Trump administration's shifting approach to workplace raids has left business owners in a state of limbo. In June 2025, the president briefly paused ICE operations at farms, hotels, and restaurants after acknowledging that his enforcement measures were harming industries reliant on immigrant labor.
However, just days later, the Department of Homeland Security reversed that directive and resumed raids on these businesses. According to Reuters, ICE leadership reminded field offices during a Monday call that the target of 3,000 daily arrests—ten times the average under the previous Biden administration—would continue.
"This has been going on since Thursday, when we saw the opportunity to ensure restaurants would be recognized as essential businesses. It's been a very busy weekend," Emily Williams Knight, CEO of the Texas Restaurant Association, said during what was supposed to be a celebratory press conference about the pause.
Economic Ripple Effects Spread Statewide
The impact extends far beyond individual restaurants. Williams Knight warned that when restaurants cannot operate at full capacity due to staffing shortages, "that means the dollar that restaurants put into each community, for a dollar spent, goes away, and then those workers are also not spending".
Texas restaurants serve as the state's largest private-sector employer, making the industry's struggles particularly significant for the broader economy. The fear factor has led to what researchers describe as a withdrawal from the formal economy, with immigrant families reducing spending on essentials and services.
Dr. Bob Sanborn, president and CEO of Children at Risk, highlighted the demographic reality facing Texas cities: "In cities like Houston and Dallas, what we're looking at is close to 50% of the children are children of immigrants or immigrants themselves".
National Context and Data
The situation in Texas reflects broader national trends. According to government statistics, approximately 11 million people lived in the United States illegally as of 2022, a figure that may have risen to 14 million according to the Migration Policy Institute. These undocumented workers contributed $97 billion in taxes in 2022 alone, according to Americans for Tax Fairness.
Data from the U.S. Labor Department shows that nearly half of the foreign-born workforce in America is Latino, making this demographic particularly vulnerable to enforcement actions. In the hospitality sector nationally, about 7 percent of leisure and hospitality workers are undocumented, concentrated primarily in restaurant and hotel positions.
Business Groups Seek Solutions
Industry representatives continue advocating for policy changes that would recognize the economic importance of immigrant workers. The American Hotel and Lodging Association and U.S. Travel Association note that about one-third of the hospitality workforce consists of immigrants, with over 1 million job vacancies projected for 2025.
Kelsey Erickson Streufert, a spokesperson for the Texas Restaurant Association, emphasized the state's economic reality: "We are already the largest private sector employer in the state, yet many restaurants are struggling to find enough staff. The same applies to farms, ranches, meatpacking facilities, and various segments of the food supply chain".
Uncertainty Prevails
As the Trump administration continues to prioritize immigration enforcement, Texas restaurant owners find themselves caught between federal policy and economic reality. The industry's dependence on immigrant labor, combined with the fear created by ongoing raids, has created what some describe as an unsustainable situation.
The volatile policy environment, characterized by rapid reversals and conflicting signals from Washington, leaves business owners unable to plan effectively. With ICE operations continuing at unprecedented levels and no clear resolution in sight, Texas restaurants face an uncertain future as they navigate the intersection of immigration policy and economic survival.