DACA's Uncertain Path: How Policy Threats Reshape Economic and Social Gains for Recipients

Abstract

Since 2012, DACA has provided deportation relief and work authorization to immigrants brought to the United States as children. This study examines how legal and political uncertainty—triggered by the Trump administration's 2017 rescission announcement—reshaped recipients' economic and social outcomes. Using difference‐in‐differences and event‐study methods, we show that early gains in employment and earnings eroded sharply under heightened uncertainty. In contrast, responses along other margins—including health insurance coverage, schooling, and in‐state mobility—proved more resilient and in some cases strengthened over time. Supportive environments, such as sanctuary and low‐enforcement states, attenuate labor market losses and sustain investments in nonlabor outcomes. These findings highlight how policy uncertainty can erode labor market gains while shifting behavior toward protective and longer‐horizon investments.