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What the Numbers Miss Behind the measurable economic impacts of disruption are the less visible forces that shape communities and long-term outcomes. By Alli Bily and Lynn MacDonald
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hen communities face sudden disruption, economic effects show up quickly and sometimes in unexpected ways. Recent estimates by the city of Minneapolis indicate that during Operation Metro Surge there were more than $203 million in losses in Minneapolis in a single month. Early estimates from economists Aaron Rosenthal and Aaron Sojourner suggest that Department of Homeland Security (ICE) activity had a measurable impact on consumer spending across Minnesota.
In January 2026, spending in the state declined by 2.9 percent, representing a loss of approximately $626 million. The effects were more muted in Hennepin County, where spending fell by 1 percent that same month. The largest declines were seen in food and accommodation, with spending in those areas dropping by 3.8 percent statewide and 4.1 percent in Hennepin County. While not yet definitive, these early estimates help capture the immediate economic impact — but they only tell part of the story. Economists point
Contributors ________ Allison Bily, M.S., is a 2019 St. Cloud State University graduate in economics and 2020 graduate of University of Illinois; Lynn MacDonald, Ph.D., is an associate professor of economics at SCSU and co-director of the SCSU Center for Economic Education.
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to the idea of opportunity cost to explain what isn’t captured in these numbers. Opportunity costs are the losses tied to foregone spending, business activity, and economic participation that never fully materialize due to resources, time, or energy being directed elsewhere. Opportunity costs are hard to measure and vary by person, so these estimates likely undercount the true cost. Focusing solely on what’s lost only tells part of the story. Disruption can also change how communities respond — often leading to greater reliance on relationships and local networks. Some economist suggest that the community bonds formed during this time are both incredibly important and economically valuable. During periods of shared disruption, communities often collectively respond through mutual aid, stronger social ties, and increased support networks — patterns visible across Minnesota during this period. When people and communities go through something difficult together, there can be increased short-run cohesion. However, while people may come together in the short term, this sense of trust and cohesion can fade over time. Just as social responses can reflect both increased cohesion and long-term strain, economic activity during disruption can be similarly mixed. Increased car break-ins can mean more business for auto repair shops. This kind of activity, however, doesn’t make a community better off — it shifts resources toward fixing damage instead of building
something new. Economists refer to this behavior as the broken window fallacy. The same logic applies more broadly during periods of disruption: visible activity can increase in some areas, even as the overall economy absorbs losses. While the full economic costs of ICE activity are still unfolding, economists have a framework for understanding how community responses shape economic outcomes. The kinds of community responses described are not just social — they have measurable economic significance. Research on social capital by economist Edward Glaeser and team shows that greater community rootedness is associated with stronger social connections, which in turn are linked to stronger economic outcomes. This relationship develops through several pathways, including homeownership and high-density living. Homeownership can create stronger neighborhood ties and reduce the likelihood of moving, while closer proximity to neighbors — such as in multifamily housing — increases opportunities for regular social interaction. Economists Raj Chetty and colleagues find that social connectedness — specifically friendships across income lines — is a major contributing factor to upward mobility. This research highlights an important but often overlooked reality: alongside the measurable economic losses, there are also forms of value that are more difficult to measure. Even so, these benefits arise under difficult circumstances and do not erase the underlying costs.