Minneapolis businesses are reporting severe economic damage from the Trump administration’s immigration enforcement operation in the Twin Cities. Some companies have seen sales drop 80%, and customers and employees are avoiding the area out of fear, according to a lawsuit filed this month by Minnesota and the city. Hotels have stopped accepting reservations, while restaurants and stores have temporarily closed or cut hours.
The economic disruption extends beyond immigrant-heavy businesses, threatening the broader regional economy. Minneapolis business leaders warn the damage could become permanent if the federal operation continues.
Widespread Economic Damage
Minneapolis businesses are struggling to stay open as fear of immigration enforcement reshapes the Twin Cities economy. At Taste of East African, a restaurant that once drew mostly Somali customers, the manager and owner are now the only employees coming to work. Regular patrons have stopped visiting the restaurant in an area heavily populated by immigrants that has become a frequent target of immigration arrests. Delivery workers have also stopped accepting orders, afraid to visit the neighborhood.
“Even if you tell ICE you’re a citizen they won’t listen, so everyone is scared,” said Hibaq Nimale, the restaurant’s manager and a U.S. citizen raised in Kenya as a refugee from Somalia.
The impact has spread across large sections of Minneapolis. Stores have temporarily closed, canceled events, or reduced their hours. Some hotels that housed federal immigration officers have stopped accepting reservations altogether following protests. Target Corp., based in Minneapolis, has also seen demonstrations at its locations and headquarters.
A lawsuit filed this month by Minnesota and the Twin Cities documented the severity of the downturn. The suit claims that some businesses reported sales drops reaching 80% and urges a federal judge to halt the immigration operations, citing “devastating economic impacts.”
A January report from the Minneapolis Federal Reserve noted that some Minnesota businesses experienced “dampened sales and slower foot traffic” out of fear of immigration enforcement. The report noted these concerns even as the region was already facing sluggish economic conditions. Nearly 20% of all businesses surveyed reported lower employment head counts citing fear of immigration enforcement.
Impact Across All Sectors
The disruptions have reached far beyond immigrant-owned retail and restaurants. Fred Haberman, co-founder and CEO of a small marketing firm in Minneapolis, said his business has been affected by significant disruptions to “support systems,” like schools and day care programs that employees depend on to maintain regular work schedules.
“Many of these businesses don’t have huge margins to play around with,” Haberman said. He warned that the city’s economic landscape could be permanently altered if the federal government does not reverse course soon.
Adam Duininck, CEO of the Minneapolis Downtown Improvement District, observed the breadth of the disruption. “I’m seeing it impact everybody, just because of the lower levels of people traveling and spending discretionary income,” he said.
Hotel chains have struggled to navigate the conflict between economic viability and safety. At least one location initially canceled reservations for federal immigration officers following protests, only to reverse course after the Department of Homeland Security accused the hotel of impeding law enforcement.
As of Wednesday, at least three Twin Cities hotels were not accepting reservations. The Hilton DoubleTree and InterContinental in downtown St. Paul displayed signs saying they were “temporarily closed for business until further notice.” The Hilton Canopy in Minneapolis, which had been the site of loud protests by anti-ICE demonstrators, was open but not accepting new reservations.
An InterContinental employee said the hotel was closing for staff safety but would not provide further details. Hilton and IHG did not respond to requests for comment.
Duininck noted that hotels face conflicting pressures. Many employees in the hotel industry are non-white and fear profiling from federal agents. At the same time, many hotel owners worry about economic retaliation from either the federal government or protesters.
“What feels safe for me as a businessperson is different from people that are coming down here to go to the job,” Duininck said. He called the impossible choice “exactly what the political moment is for our city and for our country.”
Community Response and Legal Rights
Faith leaders, labor unions, and activists have organized a general strike planned for Friday, calling for residents of the Twin Cities to not work, shop, or attend school “to demand immediate cessation of ICE actions.” The action reflects a pattern of economic protest in Minneapolis. Civil rights leaders in Minnesota called for a boycott of Target Corp. last year after the retailer announced it would phase out some diversity, equity, and inclusion initiatives. More recently, roughly 100 clergy protested outside Target’s downtown Minneapolis headquarters demanding the retailer take a stronger stand against federal law enforcement activity.
Workers and patrons do have legal rights in spaces where immigration officials are present. Both immigrants and citizens can decline to talk to immigration enforcement officers, refuse to consent to searches, or ask for an attorney, according to John Medeiros, who leads the corporate immigration practice at Minneapolis-based law firm Nilan Johnson Lewis.
Immigration and Customs Enforcement needs permission from an employer or a judicial warrant to enter private spaces of a business, such as back offices. A judicial warrant must be signed by a judge and list specific information the agency is authorized to seek. The warrants can be limited to specific days or types of information.
Immigration attorneys have raised concerns that ICE has entered private spaces without proper warrants. Medeiros encourages people to record encounters with federal agents.
At Taste of East African, Nimale has received an outpouring of support from non-immigrant neighbors. Before the enforcement surge, she estimates close to 80% of her customers were Somali. Now, that figure stands at roughly 10%, with new customers unfamiliar with East African cuisine filling the gap despite the slower service caused by the shortage of employees.
“I’m grateful for my neighbors’ kindness,” Nimale said, “but I worry it’s far from a sustainable solution. We don’t know how long we can get support.”