Ontario loses 38,000 jobs as U.S. tariffs hit manufacturing sector
A new report published by the Financial Accountability Officer of Ontario found employment had dropped by 38,000 jobs in the province during the second quarter of the year.
'The unemployment rate rose for the ninth consecutive quarter, reaching 7.8 per cent in 2025 Q2,' part of the report said.
'This is 2.6 percentage points higher than the low of 5.2 per cent recorded in 2023 Q1, and marks the highest unemployment rate since late 2012, excluding the pandemic.'
The report found tariffs levied by U.S. President Donald Trump on Canadian imports to his country were behind some of the changes.
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The largest drop in employment came in manufacturing, where 29,400 jobs were lost in the second quarter of 2025. Business, building and support services lost 14,900. There were also substantial drops in employment in transportation and warehousing, as well as in agriculture.
Overall, employment in Ontario's industrial sector dropped by 3.5 per cent in the second quarter of 2025 — a change the financial watchdog attributed to U.S. tariffs.
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Those job losses were partially mitigated by gains in finance, insurance, real estate and scientific and technical services.
Opposition politicians pointed to the numbers as evidence Premier Doug Ford was failing to deliver on his election promise to 'protect Ontario' from Trump and the effects of his economic policies.
'These numbers are truly alarming. Ontario workers are facing the worst job losses in more than a decade, with the manufacturing sector hit especially hard,' said NDP MPP and finance critic Jessica Bell.
'Families can't afford more government inaction while good, full-time jobs disappear from right underneath of us.'
Ontario Liberal finance critic Stephanie Bowman issued a similarly harsh statement, accusing the government of failing to fulfill its central election promise.
'This report shows that we are heading in the wrong direction. Record spending by the Conservative government is doing nothing to fight high unemployment,' she said.
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'Never has a government spent so much to deliver so little. Working families are struggling, we are building housing at the slowest rate in a decade, and many of the businesses impacted by tariffs are not eligible for help from the province.'
A spokesperson for Ontario's minister of finance said the government was doing everything in its power to protect jobs.
'With President Trump's tariffs taking direct aim at our economy, our government is using every tool we have to protect the over 800,000 jobs in Ontario's world-class manufacturing sector,' they wrote.
On Wednesday, Ontario unveiled $70 million for its tariff relief efforts. The money was put towards offering expanded training and employment services for workers in tariff-hit industries like steel or autos.
The province also opened up $1 billion in emergency loans for businesses struggling in the face of tariffs earlier this month. It is part of a broader $5 billion pot, although the plan for the remaining $4 billion has not been made public.
Bowman said the current offerings were insufficient.
'Tariff 'relief' measures announced by this government will do little to help in the long term,' she wrote in her statement.
'They are mostly temporary measures and will do little to help the thousands of companies, especially small businesses, who are bearing the brunt of this trade war.'
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