Ontario could lose more than 68,000 jobs by the end of this year due to U.S. tariffs, according to a new report from the province’s financial watchdog.
Jobs losses could reach 137,900 over the next several years, according to the Financial Accountability Office of Ontario (FAO), which provides independent financial and economic analysis for the provincial legislature.
Using tariffs announced on April 17, including U.S. levies on steel, aluminum, vehicles, and parts, as well as Canadian retaliatory tariffs, the report examined the impact the tariffs could have over the next several years.
The report notes that 77 percent of Ontario’s exported goods and 60 percent of its exported services go to the U.S., while U.S. imports of goods made up 68 percent of the province’s total imported goods and 63 percent of total imported services.
Exports to the U.S. represent 13 percent of Ontario’s GDP, more than double what the province exports to the rest of the world, report authors wrote.
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In 2024, about 933,000 Ontario jobs (one in nine jobs) were related to U.S. exports, according to the report. Most (536,000) were in the goods sector, largely manufacturing, while 397,000 (one in 20 jobs) were in services.
The FAO is forecasting 68,100 fewer jobs in Ontario in 2025, and 119,200 fewer jobs in 2026, compared to a no-tariff scenario.
If tariffs persist into 2029, the province could see 137,900 fewer jobs.
Ontario’s unemployment rate, which is currently at 7.5 percent according to Statistics Canada, is predicted to rise to 7.7 percent between 2025 and 2029 if U.S. tariffs remain in place.
The manufacturing sector is expected to see the largest job loss in 2026, with 57,700 fewer positions, a loss of 6.8 percent.
Southwestern Ontario cities will see the largest job loss, with Windsor and Guelph at the top of the list with a 1.6 percent increase in unemployment in both cities.
Brantford and Kitchener-Cambridge-Waterloo will see a 1.5 percent increase in unemployment, while London will see a 1.3 percent rise, according to the report.
Tariffs and GDP Drop
Under the FAO’s tariff scenario, Ontario’s GDP growth will slow to 0.6 percent, far below the 1.7 percent growth anticipated in a no-tariff situation
The report authors also say the province could see a “modest recession” for 2025 as a result.
Ontario Premier Doug Ford disagreed with the report forecast. “Let’s see what happens,” he said in response to a reporter’s question about the FAO report at an unrelated news conference in Mississauga on April 30.
“No one can predict the future, but I’m predicting that we’re going to do better than other jurisdictions around the world and around North America,” Ford said.
The FAO predicts GDP growth in 2026 under tariffs to be 1.2 percent lower than the 1.9 percent growth predicted in a no-tariff scenario.
The report estimates Ontario’s manufacturing sector alone will suffer an 8 percent drop in GDP in 2026, while other sectors will also be affected by the tariffs through supply chains and lower consumption.
The FAO projects a 3.8 per cent decline in real international exports relative to a no-tariff scenario in 2025.
By 2029, Ontario’s real international exports will be 7 percent lower than in a no-tariff scenario, according to the report.
