In Minneapolis, the effects of Operation Metro Surge continue to devastate local businesses long after the federal immigration enforcement operation officially concluded.
Daniel Hernandez, owner of Colonial Market grocery stores, says sales at his stores have declined by roughly 60% since ICE officers made his parking lot a regular hangout.
“We’re barely — literally barely — surviving,” Hernandez told CNBC. “The damage has been done.”
Hernandez shuttered his Colonial Market location on Lake Street this summer, having spent savings and borrowed money against his house to open it just two years prior.
Cities where immigration raids took place in 2025 experienced a nearly 3% decline in weekly foot traffic and a more than 6% drawdown in spending, according to University of Pennsylvania professor Zeke Hernandez.
Collectively, that analysis found around 8 billion fewer visits and billions of dollars in lost spending across targeted communities in that year alone.
“You are creating recession-like conditions in targeted neighborhoods,” Zeke Hernandez said. “It’s like a localized recession.”
Operation Metro Surge, billed as the largest-ever immigration enforcement action by the Department of Homeland Security, ran from early December through mid-February in the Minneapolis area.
The Lake Street Council reported that immigrant-owned businesses in that commercial district cumulatively lost $46 million in December and January during the height of the operation.
At bars and eateries in ZIP codes along the Lake Street corridor, year-over-year foot traffic underperformed nearby neighborhoods for months after the surge ended, with that gap peaking in March at nearly 10 percentage points, according to data from Advan Research.
The Minneapolis city government estimated the operation cost the city almost $700 million in economic activity between December and April, a figure Mayor Jacob Frey described as likely conservative.
“Traditionally, disaster relief is not a partisan issue,” Frey, a Democrat, told CNBC. “Traditionally, disasters are not caused by the government themselves.”
City lawmakers released about $7 million for local businesses and more than $3 million in rental assistance, though Frey acknowledged that funding fell far short of what was needed.
Employment dropped in U.S. cities experiencing immigration enforcement surges, according to a Brookings Institution analysis, which found the most-impacted cities had a 0.4% employment shortfall six months after a respective surge.
Minnesota’s seasonally adjusted unemployment rate in 2026 eclipsed the national average for the first time in about 19 years, according to the Bureau of Labor Statistics.
“Operation Metro Surge can sometimes be perceived as only affecting undocumented workers,” said Tyler Schipper, an economist at the University of St. Thomas. “That wasn’t the case at all.”
Advocates for Hispanic Americans warn that immigration crackdowns threaten a demographic that has become a critical driver of national economic growth.
If U.S.-based Latinos formed their own country, the Latino Donor Collaborative told CNBC that its gross domestic product would rank fourth largest in the world at $5.1 trillion.
“We’re being challenged right now,” said Sol Trujillo, co-founder of the California-based Latino Donor Collaborative. “These policies can be highly disruptive to our economy.”
The growth rate for average Hispanic household spending decreased by about 2 percentage points over the last two years, according to market research firm Numerator.
White House spokesperson Lauren Bis said in a statement that a “surge in illegal immigration under President Biden threatened the long run fiscal health of the country, contributed to record high inflation, and suppressed the wages of American workers.”
R.T. Rybak, chief executive of the Minneapolis Foundation, said large corporations were slower to speak out about the surge than they were following the death of George Floyd.
“I think it’s pretty well understood around here that this was not the greatest moment for our usually very effective corporate philanthropic sector,” said Rybak, a former Democratic mayor of Minneapolis.
While August data from Advan Research showed year-over-year foot traffic growth for Lake Street restaurants outperforming surrounding areas for the first time since the surge began, fear persists throughout the community.
“For immigrants who are still here in Minneapolis and in the surrounding areas, that fear never left,” said Miguel Hernandez, owner of Lito’s Burritos on Lake Street. “They are operating at an intense level of caution still to this day.”
Daniel Hernandez said his remaining Colonial Market store could face eviction later this month after falling behind on rent, with a GoFundMe campaign raising just over $3,000 to help keep the doors open.
“During the storm, you can feel the winds. But once the storm is over, all that you see is destruction,” he said. “That’s what happened here.”
