Foot traffic to small shops fell after last year’s ICE raids. Owners say it never really came back

This story first appeared on The LA Local.

When he thinks back to June 2025, Melchor Moreno remembers the empty streets outside of his restaurant. 

Neighboring businesses closed early or sometimes wouldn’t open at all. One weekday, he made just $500, hundreds short of what he needed to cover his overhead. 

Moreno owns and operates La Chispa de Oro, a traditional Mexican restaurant on Cesar E. Chavez Avenue that’s been a Boyle Heights staple for more than 30 years. When Immigration and Customs Enforcement operations disrupted his and other Eastsiders’ businesses last summer, survey data collected by Boyle Heights Beat showed a sharp drop in sales; Moreno marked losses at around $7,000 per month that summer. But even when the raids slowed, the business never bounced back, Moreno said. 

“People still have it in the back of their mind that ICE may come at any time or any minute and streets are not back to normal like they should be,” Moreno said. “You can see that businesses are not the same, especially for restaurants. Even a year later.”

The economic fallout of the increased immigration enforcement over the last year has hit independently owned restaurants and retail businesses hardest — especially those in communities with Latino immigrants, Spanish speakers and noncitizen workers, according to the L.A. County Economic Development Corporation, or LAEDC, the nonprofit that promotes and studies the region’s economy. 

Street vendors, day laborers, and sellers at popular clothing districts have been forced to adapt to a new cycle: an intense and unexpected immigration operation, then an economic lull as potential customers stay home out of fear. Even just a rumor of ICE activity can start the cycle over again. Business owners selling skateboards, records and supplements have noticed fewer people walking through their doors. And with many businesses still financially recovering from the COVID pandemic or wildfire impacts — and now grappling with tariffs and increased fuel costs — the economic chill that resulted from the raids could alter industries across L.A. for years. 

“Economists love to pretend like they have a crystal ball,” said Shannon Sedgwick, vice president of research at LAEDC, “but I think one of the most damaging things to our economy related to any kind of federal policy shift that has been taking place lately is the degree of uncertainty that surrounds it all.”

A ‘climate of fear’ and depressed economic activity

Soon after the raids began, the L.A. County Board of Supervisors asked researchers with LAEDC to find out the economic impacts of the raids and the weeklong curfew that followed citywide protests. 

It was clear that the operations targeting undocumented immigrants would have an impact: LAEDC estimates undocumented workers are responsible for about 17% of the county’s economic activity. But researchers found an even farther-reaching effect, Sedgwick said, with additional communities and industries becoming collateral damage.

“It creates a broader economic ripple effect that extends beyond direct enforcement actions,” Sedgwick said. 

Of the 178 small businesses interviewed, 82% said they were negatively impacted by the raids, citing reduced daily sales, decreased customer traffic or changes to their workforce. Some of the most vulnerable areas, according to the report, include the L.A. neighborhoods of Westlake, Echo Park and Boyle Heights, as well as southeast L.A. cities such as South Gate, Pico Rivera and Bell. 

According to Sedgwick, small businesses are more vulnerable to shifts in their customer base and feel sharper impacts than their chain or franchised counterparts. Of the businesses interviewed for LAEDC’s impact survey, 15 had closed by December 2025.

It’s not clear when the local economy will return to its normal patterns, Sedgwick said.

“It’s that unsettled climate of fear that’s really impacting people’s activity and, as a result, our economic activity,” she said. “If that uncertainty, unsettled feeling and fear about what’s happening, if that subsides, then this will kind of shift back. But in the interim, we’re already seeing some of the fallout.”

Feeling the financial pinch in Westlake and Pico Union

At Leo’s Tacos near Venice Boulevard and Vermont Avenue in Pico Union, the tacos al pastor that the truck is known for still cost $2.50 each, but they’re not selling like they used to. 

Manager Maria Martinez said that business is still down about 30% after dropping significantly last summer, though the truck has tried to avoid passing down its financial strain to customers. The business is surviving because of tourists and loyal fans stopping by, she said, but there are simply fewer people coming each day. She said some of the people detained this year were longtime customers, while others have told them they’re still afraid to go out — both of which have hurt business.

Maria Martinez works at Leo’s Tacos, which is known for its tacos al pastor.

(

Marina Peña

/

The LA Local

)

“The people who are afraid don’t walk around the same anymore, they don’t circulate the streets like they used to,” she said in Spanish.

Not even the FIFA World Cup, which soccer officials predict will bring more than $892 million in economic activity to L.A., has so far been able to reverse the reduced foot traffic for some small businesses. 

Luis Sanchez, who sells jerseys and sports apparel at a store called Sports in Westlake, said sales have remained flat over the past six months. 

Sanchez, whose business sits near MacArthur Park, said jerseys for Mexico, Argentina, Brazil and the U.S. national team remain popular, but demand still has not risen the way it did during previous tournaments. 

“In other years, you could already see the increase around this time,” he said. “But because of the raids, things haven’t been the same.” 

Sanchez added that many customers appear more focused on politics and economic concerns than soccer. “Politics are overshadowing sports,” he said. “There are people who think the World Cup should even be canceled.”

Along the El Salvador Corridor, street vendors say that ongoing fear — and the lack of foot traffic that comes with it — continues to shape their daily lives and affect how their businesses are doing.

Mirna Lopez has run a stand called Cocteles Acajutla since 2013, where she sells ceviche made with clams, shrimp and octopus. She said the fact that raids are still ongoing has made it difficult for sales to recover.

“I think people are still scared because they keep hearing on the news that raids are still happening,” Lopez said in Spanish. “People don’t know what’s true anymore or what’s going to happen. I hear about many people who say they are returning to their home countries.”

At Cocteles Acajutla, Mirna Lopez said sales are still about half of what they were before the raids began last year.

(

Marina Peña

/

The LA Local

)

Lopez, who works from 8 a.m. to 5 p.m. seven days a week, said that before the raids, she would typically make around $400 a day, but nowadays she doesn’t even reach $200.

“I don’t bring as much anymore, just what I think I might sell, and even then I still don’t sell it all,” she said. “I haven’t thought about offering promotions because I don’t want people to get used to that. Everything is expensive right now to do that. It’s hard to invest your money and not make it back.”

Sergio Jimenez, a senior community organizer with Community Power Collective, said the downturn affecting vendors right now cannot be separated from years of economic instability impacting immigrant communities across Los Angeles. 

“It’s been a really tough four years for vendors,” he said, pointing to the pandemic, inflation, rising housing costs and the raids. “It has created ongoing fear and insecurity, and foot traffic has dramatically slowed down, especially among working-class Latino immigrants, who have traditionally been the main customers for street vendors because it’s such a big part of the culture.”

Jimenez said many vendors have adapted by working shorter shifts, taking less merchandise to avoid major losses and relying on community networks to warn each other about immigration enforcement activity. 

In some cases, he said teenagers stepped in to help support their families financially. 

“I saw youth. I saw a second or third generation of street vending families, having to go out and substitute for their parents because of fear and ensuring that they could bring money into their homes,” Jimenez said.

Adjusting to the new normal in LA’s Eastside

At La Chispa de Oro, Moreno was forced to cut hours for his employees at the peak of the raids. He had to help wash dishes and cook meals in the kitchen. Now, he plans to permanently alter his business hours to open up later and close earlier to save.

Sales have slowly increased from their lows, but only once the community stopped hearing rumors of agents being around. But all it takes is one rumor to keep customers away, Moreno said.  

La Chisa de Oro plans to cut its hours to make up for business lost since the raids surged.

(

Andrew Lopez

/

The LA Local

)

In East L.A., Herbs of Mexico, a longstanding herb and supplement shop, saw a 75% reduction in business last summer, according to owner Martin Lopez. Lopez described the impacts of the raids as a “pile-on” that exacerbated the already unsteady business brought upon by tariffs, inflation and the recent hike in fuel prices

“We’re getting squeezed in a lot of different ways,” Lopez said. The owner was forced to make hard decisions over the last year.  He’s laid off staff, ordered fewer products and even spent his own money to buy things like toilet paper and coffee for his employees working out of the office.

“The problem that we are experiencing is the catch-up. It’s hard to catch up. It’s hard to stay ahead because you’re always behind in regard to [the raids],” Lopez said.

Lopez reported a return of some business, but said he’s still making 30% less than he did in the summer of 2024 by comparison. He agreed that mere rumors of ICE agents being nearby can devastate business for short periods of time.

“One person can say one thing, and then it just spreads like wildfire on social media,” Lopez said. “And then we don’t see anyone come in because they said, ‘I saw something here at this corner. I saw ICE.’ And then that entire region just shuts down, and no one comes in. That happened so many times from June on.”

Recommendations to local leaders

Even before the research showed the scale of economic fallout from the raids, Sedgwick said county entities were activating services for impacted business owners. 

Departments within L.A. County moved to produce resource guides for businesses and individuals and put together a business resiliency fund, Sedgwick said. 

Council District 1 representative Eunisses Hernandez launched a program to support vendors and brick-and-mortar businesses with grants up to $10,000 during the raids.

In CD 14, Councilmember Ysabel Jurado worked with the Community Investment for Families Department and the Economic and Workforce Development Department to create the Ysabel Jurado Microenterprise Grant Program. The program is set to provide up to $3,000 in direct relief to impacted small businesses across the district to fund basic operating costs like rent, utilities, payroll, insurance, and inventory.

At the direction of L.A. County Supervisors Hilda Solis and Janice Hahn, the L.A. County Department of Economic Opportunity launched a Small Business Resiliency Fund in September 2025 to offset financial and workforce disruptions brought upon by increased immigration enforcement. 

The program provided up to $5,000 in direct relief to brick-and-mortar restaurants, street vendors, independent contractors and some home-based businesses. Applications ended last fall and, to date, the fund has granted $5.4 million to more than 1,300 businesses countywide. 

It’s unclear how those grants compare to the need. Sedgwick and her colleagues at LAEC are continuing to research the “longer, lasting effects still at play” considering that increased enforcement is still taking place. 

“It hasn’t gone away. Initially, the flashpoint and the severity of it was very in your face. But it doesn’t mean that it’s not happening still,” Sedgwick said. 

The uncertainty of when another ICE raid will come to East L.A. continues to test Lopez and other business owners, and he said he also wonders if some other crisis could be next. 

“If another event surfaces from this administration, it’s going to continue to pile on and put other businesses at risk for failure and bankruptcy … A lot of people cannot pay back their [Small Business Administration] loans that they got from COVID because they just can’t make it. So everyone is struggling,” Lopez said.

Near his shop, a market and a retail store have closed for good.

“It’s tough to see those things,” Lopez said. “It’s a daily struggle, and it does affect us from a mental health perspective because we don’t know where the shoe’s going to drop. We have to maintain our health and sanity just to keep going these days.”