A new Financial Accountability Office report predicts Ontario could lose 68,100 jobs this year due to U.S. tariffs and Canadian countermeasures, with manufacturing hardest hit. The trade conflict may trigger a modest recession in 2025, slow economic growth, and raise consumer prices across the province.
U.S. Trade War Threatens Tens of Thousands of Ontario Jobs
Ontario’s economy is bracing for significant job losses in 2025 as U.S. tariffs and Canada’s retaliatory measures take a toll, according to a new report from the Financial Accountability Office of Ontario (FAO). The report estimates 68,100 fewer jobs this year, with losses potentially rising to 119,200 in 2026 and 137,900 by 2029 if tariffs persist.
Manufacturing Sector to Bear the Brunt
The manufacturing industry, especially primary metals, motor vehicle parts, machinery, and electronics, will be the hardest hit. The FAO projects 17,700 job losses in primary metals alone. Supply chain industries and labour-intensive service sectors like trade and transport will also feel the impact. Windsor, Guelph, Brantford, Waterloo, and London are expected to experience the steepest employment declines due to their reliance on export-focused manufacturing.
Economic Growth Slows, Modest Recession Possible
The FAO warns Ontario’s real GDP growth could slow to just 0.6% in 2025-less than half the growth expected without tariffs-signaling a modest recession. While growth may recover modestly by 2027-2029, it will remain slightly below no-tariff projections. Consumer prices are also expected to rise modestly, with inflation rates 0.2 to 0.3 percentage points higher due to tariffs and related economic pressures.
Uncertainty Remains Amid Ongoing Trade Developments
The report notes that the actual economic impact depends on the scale, duration, and responses to tariffs. Recent partial reversals of U.S. auto tariffs may ease short-term pressures but are unlikely to change the longer-term outlook significantly. Ontario Premier Doug Ford expressed cautious optimism, emphasizing efforts to secure investments and maintain jobs despite the challenges.
Calls for Proactive Measures to Protect Ontario’s Economy
Opposition voices, including Ontario Green Party Leader Mike Schreiner, urge immediate action to safeguard jobs and strengthen the economy, warning that waiting could worsen the province’s economic outlook.
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