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USMCA breakdown scenario could cost Canada 102,000 jobs
A report tied to USMCA negotiations estimates a full Canada-US-Mexico agreement breakdown would eliminate 102,000 Canadian jobs, with impacts concentrated in auto, metals, and machinery manufacturing.
Canada could face a major labor-market hit if the Canada-United States-Mexico Agreement, also known as CUSMA or USMCA, fully breaks down, according to a report cited by Insurance Business.
The Canadian American Business Council said the full-breakdown scenario would cost Canada 102,000 jobs on its own. The same analysis projects 137,000 additional American jobs and 98,000 Canadian jobs in 2027 under a successful renegotiation, compared with a status quo outcome.
The report models three paths after a July 1, 2026 deadline to renew USMCA, which passed without a formal agreement, and links the losses mainly to tariff-affected manufacturing industries. It also notes spillovers to the services sector, including reduced disposable income and lower consumer spending, alongside weaker demand for transportation, construction, and professional services.
It also points to geographic exposure, saying Ontario, Quebec, Manitoba, and New Brunswick are most vulnerable to tariff swings due to their concentration in auto, metals, and machinery manufacturing. According to the analysis, Ontario and Quebec would see both the largest gains under successful renegotiation and the biggest damage under a breakdown scenario.