33,000 Jobs Lost in March
Foreshadowing of things to come?
President Trump continues to apply economic pressure to Canada through the use of tariffs. Canada may finally be starting to feel some of that pressure, as the March job report was not great.
33,000 jobs were lost in March, which marks Canada's highest job loss since January of 2022 during the pandemic. January 2022 was when Canada imposed stricter public health measures due to the spread of the Omicron variant of COVID-19. Most months since that time, Canada has experienced job gains, and in the few months where there have been losses, they've been very minor.
The result has increased unemployment to 6.7%, which is closing in on the two-year high of 6.9%.
Canada's auto industry has been particularly hard hit by the tariff situation, as many auto parts travel back and forth across the border several times before being assembled into a completed automobile. After President Trump's initial round of tariffs affecting the auto industry, Canadian Prime Minister Mark Carney announced reciprocal tariffs on American automobiles. Prime Minister Carney also pledged a fully Canadian auto manufacturing line from start to finish as part of his campaign for the upcoming election.
Other Canadian industries that have been hard hit by tariffs are the aluminum and steel industries, as well as canola farmers. Notably, canola farmers are experiencing issues due to tariffs from China in a separate trade issue.
Canadian exports to the United States account for over 75% of all exports and around 20% of Canada's GDP. President Trump's foreign policy so far points to a desire to decrease American dependence on foreign imports. It remains to be seen whether that will mean Canada will face more tariffs or other economic pressures. But it very likely means a decrease in exports from Canada to the U.S.
Canada is only just beginning to feel the impact of the tariffs. The tariffs will decrease demand for Canadian imported goods in the U.S., which will impact Canadian industries that supply those exports to the U.S. Notably, Canadian oil products only have a 10% tariff applied to them. Oil products account for about 30% of Canadian exports to the U.S. An increased tariff and decreased demand for Canadian oil in the U.S. would have major economic repercussions for the country.