Goldman Sachs: Immigration collapse cuts US breakeven job growth to about 50,000 monthly

Policy shock redraws US hiring baseline

Goldman Sachs says a sharp fall in net immigration is materially changing the United States’ labour‑supply math and lowering the economy’s breakeven pace of job creation. The bank calculates an roughly 80% collapse in net immigration after what it records as more than 10.8 million illegal entrants during the Biden years, with net inflows sliding from about 1,000,000 people per year in the 2010s to roughly 500,000 in 2025 and a projected 200,000 in 2026. That decline leads Goldman to estimate the US will need only around 50,000 new jobs per month by year‑end to keep the unemployment rate from rising, down from roughly 70,000 today.

Goldman frames the shift as both a demand and supply story. On the supply side, lower immigration reduces workforce growth and eases hiring needs; on the demand side Goldman warns job growth looks increasingly narrow, dominated by healthcare, with openings drifting from about seven million toward the mid‑six‑million range. The bank aligns its findings with independent analyses from Brookings, the Congressional Budget Office and Bureau of Labor Statistics data, saying the consensus view is that immigration changes are materially affecting labour availability and policymaking.

The note also emphasises downside risks that could further compress labour supply or obscure true activity. Goldman flags elevated deportations, tighter visa and green‑card policies, pauses in immigrant visa processing and loss of Temporary Protected Status as factors that could shrink the formal workforce or push workers into off‑the‑books employment. The bank adds that artificial intelligence is the largest wildcard, warning that a faster or more disruptive AI adoption could curb hiring or raise job losses beyond current estimates, compounding uncertainty for demand and the labour market outlook.

Obesity drug rollout and competitive watch

UBS research on US anti‑obesity GLP‑1 prescriptions shows strong new‑to‑brand prescription momentum for Novo Nordisk’s Wegovy, noting an encouraging start to its oral pill launch and an uptick in pen starter prescriptions early in the year. UBS highlights a high ratio of pill NBRx to total prescriptions, suggesting little cannibalisation of injectables, and flags Medicare coverage beginning in July, an upcoming high‑dose 7.2 mg Wegovy launch and competition from Lilly’s orforglipron as key monitoring points.

Chinese EVs raise industrial‑security alarm in Europe

Goldman analyst Christian Frenes says the rapid rise of Chinese electric vehicles in Europe is an industrial‑security concern, not just a market‑share story. He notes Chinese‑brand registrations at about 31,000 units in January 2026 — up sharply year‑over‑year — and warns sustained expansion, deep price discounts and potential factory tie‑ups risk hollowing out local manufacturing and supply‑chain resilience unless policymakers respond.