With U.S. president Donald Trump vowing to pursue border taxes, renegotiate the North American Free Trade Agreement and implement policies that put “American workers and businesses first,” Canada has reason to be concerned.
The federal government is well aware of the economic risks. Cabinet members are currently huddled in Calgary for a two-day retreat, where the focus is reportedly on preparing for a Trump presidency. In conversations with their American counterparts so far, federal government officials have emphasized the importance of Canada to the United States economy and reiterated the two countries enjoy a mutually beneficial relationship. Stephen Schwarzman, the CEO of Blackstone Group and head of Trump’s strategic and policy forum, echoed those points today. “Trade between the US and Canada is very much in balance and is a model for the way trade relations should be,” Schwarzman told reporters. “So I think Canada is very well positioned in discussions with the United States.”
Still, as UBC economist Kevin Milligan points out, no one should get too complacent. Sometimes countries do things that are very much against their own economic interests—Brexit is a prime example.
When it comes to Canada, the U.S. does indeed have a lot at stake. Canada is the top export destination for 35 out of 50 states, for example. Below, we take a look at how the Canada-U.S. trade relationship plays out on a state-by-state basis. Despite the aggressive protectionist stance taken by the Trump administration, the figures below provide an incentive for the U.S. to maintain a healthy relationship with Canada.
Using figures provided by the U.S. Bureau of Economic Analysis, Canada’s embassy in Washington provides detailed state-by-state data on the number of U.S. jobs that depend on Canada-U.S. trade. We compiled that information into this snapshot showing which states have the most at stake, measured by the total number of jobs:
For a different perspective, we also ranked all 50 states by the percentage of their population that works in a job that depends on U.S.-Canada trade. So while California, as seen above, has the largest total number of Canada-dependent jobs in total, it’s actually North Dakota that would feel the biggest effect from heightened trade barriers, with more than 4% of all jobs in the state having a direct connection to trade with Canada.
Canada is the biggest export market for 35 of 50 states. This ranking shows which have the most at stake by the dollar value of their Canadian exports. While Texas has few jobs directly dependent on exports to Canada, the state sells us more than $25 billion worth of goods each year.
- Even in the age of Trump, there are U.S. trade opportunities for Canada
- To grow Canada’s exports, we have to look past the U.S. market
- How globalization is changing the game for central banks
- What’s worrying Canadian CEOs now (and what should worry them more)
- Brexit has awakened dangerous forces in the world economy
- Why are Canadians turning their backs on free trade?
- Why are Canadian companies so afraid to go global?
- Canada is failing to attract new manufacturing. Here’s how to fix it
- BDC CEO Michael Denham on helping Canadian firms go global