Alberta is bracing for economic turmoil as U.S. tariffs on Canadian goods take effect, with analysts warning of significant job losses and business uncertainty in the months ahead.
The 25 per cent levies, to be implemented Tuesday by U.S. President Donald Trump, target a broad range of Canadian exports, including manufacturing and agriculture.
A separate 10 per cent tariff applies to energy products.
The Alberta government’s latest budget forecasts a potential increase in unemployment to 7.4 per cent this year, peaking at 7.8 per cent in 2026, as businesses absorb the impact.
Prime Minister Justin Trudeau called the tariffs “unjustified and harmful” and vowed that Canada would not back down.
“We will not be intimidated,” Trudeau said last week.
“The United States has been one of our closest allies and biggest trading partners, and these tariffs are not just an attack on Canada’s economy—they are an attack on the workers, families and businesses that drive our country forward.
“We are standing firm. Our retaliatory tariffs will match these unfair measures dollar for dollar. We will not allow Canadian workers to be left behind in a trade war we did not start.”
Foreign Affairs Minister Mélanie Joly called the tariffs “an existential threat” and said Ottawa is prepared to take further action.
“We will be ready,” Joly told reporters Monday.
“We are not looking for this, we’re not seeking this, but we will respond. President Trump has tied these tariffs to border security, but we know that’s not the case. Canada has invested heavily in our border operations, and we have answered every question put forward by the U.S. administration. This is not about security—it’s about politics.”
Economic fallout
University of Calgary economist Trevor Tombe said the tariffs will force businesses to adjust, with some industries hit harder than others.
“Tariffs are taxes that the U.S. government is placing on its own consumers and businesses when they import Canadian goods,” he said.
“In the Alberta context, oil producers might take a haircut on the price they would have otherwise charged, absorbing some of the costs.”
Tombe estimated the tariffs could push Canada’s unemployment rate up by three percentage points by year’s end, with job losses concentrated in export-reliant industries.
“If these are just very short-term tariffs, then the economic disruption might be minimal,” he said.
“But if they last for months or longer, then we’ll start to see those costs mount.”
Business leaders say the uncertainty alone is disrupting trade.
Sam Woods, vice-president of JORI Logistics, an international brokerage firm, said companies are scrambling to adapt.
“We’ve seen a surge in shipments as businesses rushed to get inventory into the U.S. before the tariffs kicked in,” Woods said.
“Now, we’re fielding an overwhelming number of calls from clients trying to understand the rules and how to restructure their supply chains.”
Joly said Canada will continue negotiations with Washington but will not accept one-sided concessions.
“We have made it clear to the U.S. administration that we are prepared to defend Canadian workers and businesses,” she said.
“These tariffs are disruptive, unnecessary and damaging—not just to Canada but to American businesses that rely on our goods. If the United States believes it can bully Canada into submission, they are mistaken.”
Alberta’s response
While delivering this year’s budget last week, Alberta Finance Minister Nate Horner acknowledged the province’s vulnerability, saying the government has factored a 15 per cent average tariff into its latest budget projections.
“With uncertainty on the rise, Budget 2025 takes a cautious approach,” Horner said last week.
“These measures will dampen Alberta’s growth. We’re expecting the unemployment rate to remain high for the next two years.”
The province forecasts job losses concentrated in manufacturing and agriculture--sectors heavily dependent on U.S. trade.
At the same time, Alberta’s oil industry is expected to weather the storm better than other sectors.
“We’re in a very fortunate position compared to other provinces because of our strong balance sheet,” said Calgary Chamber of Commerce president Deborah Yedlin.
“But there will be businesses that need targeted support.”
Trade-dependent economy
Alberta’s economy is among the most exposed to U.S. trade policy.
A recent analysis by the Canadian Chamber of Commerce’s Business Data Lab highlighted the vulnerability of Alberta’s economy to the newly imposed U.S. tariffs.
The study developed a U.S. Tariff Exposure Index, which assesses both the export intensity of Canadian cities' economies and their dependence on the U.S. as an export destination.
The findings indicate that Calgary is among the most exposed cities in Canada, primarily due to its significant energy exports to the U.S.
Dennis Laycraft, executive vice-president of the Canadian Cattle Association, said the agricultural sector is particularly at risk.
“Our two industries are so integrated between Canada and the U.S. that this is going to have immediate impacts,” he said.
For businesses that rely on cross-border trade, the uncertainty is as damaging as the tariffs themselves.
“Investments are on the sidelines, and that affects small businesses,” Yedlin said.
“Big companies make the decisions, but small companies are part of that ecosystem.”
While Alberta’s government has not announced direct financial aid for affected businesses, Horner hinted that contingency funds could be used if conditions worsen.
“We’re making responsible, though difficult, decisions to fund the priorities of today,” he said.
A spokesperson for the premier’s office says the province will have a formal response to the tariffs on Tuesday.
With files from CTV’s Spencer Van Dyk
