Lake Street businesses see steep sales drops as immigrants stay home amid deportation threat

Lake Street merchants, from Mercado Central to El Taco Toro, Manny’s Tortas, Chicago Liquors and Midtown Global Market, are seeing a significant dip in sales since the Trump administration started a crackdown on undocumented immigrants.

Latinos, many of whom are here legally, are staying home, said Ajeleth Reich, whose Pupuseria El Rincon Salvadoreño Restaurant inside Mercado Central has seen a 40% decrease in business the past few weeks.

“Before the election we saw maybe 50 customers a day. Now? It’s about 20. Sometimes 15,” Reich said.

An uptick in delivery orders for the 24-year-old family-owned business has helped fill the gap, but not much.

“Customers are just afraid to come,” Reich said, echoing other Twin Cities merchants. “It’s been pretty dead lately.”

People described Midtown Global Market earlier this week as a ghost town some days.

The crackdown is real. According to the U.S. Department of Homeland Security, more than 8,700 undocumented immigrants have been apprehended nationwide by law enforcement from the day President Donald Trump took office to Feb. 3.

But false rumors abound, exacerbating the effects on businesses that cater to Latinos and other immigrant populations. Those who are in the U.S. legally don’t want to be stopped and questioned or mistakenly caught up in a raid.

Minnesota has more than 81,000 unauthorized immigrants whose spending brought in $221.7 million in state and local taxes in 2022, according to the Migration Policy Institute and the Institute for Taxation and Economic Policy (ITEP).

They spent millions more on groceries, meals in restaurants, transportation and basic household items.

“What I’m worried about is the Latino community. You know, if they don’t come and shop? That’s gonna be a big impact,” said Manny Gonzalez, who has sold his Mexican-style sandwiches on Lake Street for more than 20 years. “We pay [six employees] $17 and $18 an hour. And we pay taxes. Our employees pay taxes.”

Matt Varilek, commissioner of the Minnesota Department of Employment and Economic Development, said he and his staff have heard about the immigrant crackdown’s effect on businesses.

“We hear a lot of the same fears and concerns and I do worry about those dynamics — both from an economic perspective and just from the perspective of knowing that a lot of people are feeling so much fear,” Varilek said in an interview. “I also am concerned about the prospect of mass deportations and the impact on our labor force.”

How big of an impact on sales and the labor force? It’s uncertain, he said.

Those who hire and work with immigrants say they are already seeing a ripple effect.

“The whole community is pulling back. And it’s not just undocumented workers,” said Calvin Littlejohn, who runs TRI-Construction in Minneapolis with 93 workers, 44 of them documented or U.S.-born Latinos. All have gone through background checks and the company’s I-9 employee verification processes.

His workers have told his project managers they are staying home as much as possible.

“They’re not going to nightclubs that everybody used to go to. They’re not going to the bars. They are not going out socializing. Everybody is staying home,” Littlejohn said. “No one wants to be caught out unnecessarily. And so, yes, they as a whole community are pulling back.”

The workers told their managers about seeing police pull over a Latino driver of a construction van near their worksite. Within minutes, immigration agents showed up. One worker said she knew a Nicaraguan who needed legal help because he was pulled over and taken in for questioning; he had a visa and work permit.

Last week, TRI’s Latino workers finishing a $2.6 million remodeling job at Minneapolis City Hall reported getting harassed as they left the worksite. A pedestrian walked up and yelled, “‘Finally my president is coming in so you can get out of my country,’” said TRI-Construction project manager Alba Perez, a U.S. citizen who came to Minnesota 28 years ago from Guatemala.

The harassment put a further chill on immigrants, she said.

“Everybody’s concerned because this is our marketplace,” Littlejohn said. To express support, Littlejohn is looking for ways to stand with small businesses and workers being targeted.

“We are going to make sure we step up our Taco Tuesdays and go out and frequent as many places as we can through this storm. So every week, we’ll go visit someplace, spend our money, show our our support,” Littlejohn said.

Littlejohn thinks people have underestimated the unintended consequences of the crackdown.

The intense pressure is showing itself in commercial corridors, said Allison Sharkey, executive director of the Lake Street Council.

“Even before the election, when it seemed likely Trump might win, people were saying that traffic was down and [customers] were staying away,” she said.

Stores in St. Paul, Brooklyn Park and Inver Grove Heights report a similar retreat.

Some entities — including the Sheila and Paul Wellstone Community Center, business bankers, community groups such as CTUL, Unidos, hospitals and churches — are bringing in immigration lawyers, hosting “Know Your Rights” training sessions, sharing apps from the Mexican consulate and posting advice on social media.

The goal is to ensure non-English speakers, undocumented immigrants, their relatives and others know where to get legal advice, what to expect from their employers or what to do if their workplace is raided and they are questioned or detained by immigration agents, said Unidos organizers.

Even with outreach, business operators at the Midtown Global Market in Minneapolis, which features 18 food stalls and cuisines from around the world, are worried.

“Usually from 11 to 4 it’s pretty busy and crowded in here,” but in the past two weeks traffic is down about 15%, said David Gray, a cashier at the Kitchen By Baked Brand food staff. “And everybody’s on edge. It’s quieter. I know some people personally who are legit scared and staying in the background.”

Mark Muller, CEO of the Regenerative Agricultural Foundation, regularly buys a meal, grabs a table, opens his laptop and works for hours in the Midtown Global Market.

“Definitely something’s going on,” he said. “There aren’t as many, particularly Latino people as there used to be.”

Muller and his wife noticed customers missing at one of their favorite haunts, the Colonia Market and Restaurant, a few miles to the east along the Lake Street corridor.

“Just Friday night, my wife and I were there, and it was really quiet. Really quiet,” Muller said. “It’s heartbreaking. You think of these little businesses like trying to survive COVID and everything after the George Floyd murder, and now you’ve got this. It’s just like one thing after.”

A week ago, hundreds of residents, their families, activists and small business owners paraded down Lake Street to protest deportation efforts and to show support for immigrants.

On Monday, “A Day Without Immigrants” solidarity effort had scores of shop owners in the Phillips and West St. Paul neighborhoods closing in an attempt to emphasize the services and commerce that flow from immigrant neighborhoods.

At Midtown on Monday, 75% of the vendors closed their stalls as a way to show support for the few Latino store owners and their many Latino customers.

The Neighborhood Development Center, which co-owns Midtown, is watching the situation closely, said CEO Renay Dossman.

“There’s still a lot of fear around what’s happening and what’s going to happen,” Dossman said.