Muhammad Amanullah | August 12, 2026
The True Post (Web News) — A new economic report has warned that millions of jobs could be affected in Canada and the United States if the trade agreement between Canada, the US and Mexico, known as CUSMA, comes to an end amid ongoing negotiations over new tariffs.
The report, prepared by Oxford Economics for the Canadian American Business Council, examines three possible scenarios for the future of trade relations between Canada and the United States.
Three Possible Scenarios
The report examines three potential outcomes.
The first scenario assumes the current situation continues, with existing tariffs remaining in place. The second considers the potential economic impact if CUSMA expires. The third examines the possibility of successful negotiations leading to a renewed agreement and improved trade relations between the two countries.
According to the report, if CUSMA expires, around 214,000 jobs could be lost in the United States and approximately 102,000 jobs could disappear in Canada compared with the current situation.
That would mean a combined potential loss of about 316,000 jobs across the two countries.
Successful Agreement Could Create Jobs
The report presents a significantly different outlook if Canada and the United States successfully reach a new trade agreement.
Under improved trade relations, approximately 137,000 jobs could be created in the United States, while Canada could see around 98,000 additional jobs.
Canadian American Business Council CEO Beth Burke said the figures represent more than economic projections because they relate directly to people’s jobs, economic security and future prospects.
She said that with inflation and the cost of living already major concerns for people in both countries, further deterioration in trade relations could have consequences for ordinary citizens.
Trillions of Dollars in Potential Economic Losses
The report also examines the potential impact of the end of CUSMA on the broader economies of Canada and the United States.
According to the estimates, the expiration of CUSMA could reduce the US economy by approximately US$1.04 trillion by 2035, while Canada’s economy could suffer a loss of around C$271 billion.
The report also warns that worsening trade relations could increase inflation in both countries and affect the growth of real disposable incomes. The impact is expected to be more significant in Canada.
US Manufacturing Could Be Hit Hard
If CUSMA expires, the US manufacturing sector could face some of the largest consequences.
Industries including automobiles, wood products and metal products could be particularly affected. States such as Iowa, Michigan, Kentucky and Alabama, where manufacturing plays an important economic role, could feel the effects of increased trade barriers more strongly.
Ontario and Quebec Could Face Major Impact
Canada’s manufacturing sector could also suffer significantly if trade barriers increase.
According to the report, Ontario and Quebec are among the Canadian provinces expected to be particularly affected by deteriorating trade relations with the United States.
A separate Oxford Economics analysis examining the potential impact of new US tariffs on Canadian industries also identified several sectors that could face significant pressure.
Cement and concrete producers could be among the hardest-hit industries, while paper products, wood, computers and electronics, plastics and rubber-related industries could also face substantial challenges.
Risk of New 50 Percent Tariffs
The trade negotiations are taking place as an August 19 deadline approaches. After that deadline, some Canadian products could face new US tariffs of up to 50 percent.
The products reportedly include honey, plywood and hyacinth bulbs, among other goods. Together, these products account for approximately five percent of Canada’s exports to the United States.
Canadian officials continue to negotiate with Washington in an effort to prevent the additional tariffs and stabilize trade relations between the two countries.
Negotiations Continue in Washington
Canadian Trade Minister Dominic LeBlanc and US Trade Representative Jamieson Greer have continued meeting as negotiations progress.
The two officials have met several times recently as Canadian and American officials work on a possible trade agreement that could eventually be presented to US President Donald Trump.
Canadian Prime Minister Mark Carney has also said that discussions are continuing on several strategic areas, with the government seeking an agreement that could help Canada avoid additional tariffs.
Businesses Watching Negotiations Closely
Beth Burke of the Canadian American Business Council described the continuation of negotiations as a positive development, while emphasizing that flexibility on both sides would be necessary to reach a successful agreement.
The report highlights how closely the economies of Canada and the United States are connected. Trade relations affect not only imports and exports but also employment, industrial production, inflation, incomes and overall economic growth.
With the potential August 19 tariff deadline approaching, the outcome of the ongoing negotiations is being closely watched by businesses, manufacturers and workers on both sides of the border.
