As U.S. President Donald Trump continues to wave his tariff wand at Canada and other American trading partners, it is an opportune time to reflect on the role that cross-border trade plays in our economy and business environment. There are many ways to measure this. One of the most revealing is the number of jobs that depend on Canadian exports of goods and services to other countries.
Statistics Canada tabulations show that approximately 4 million jobs across the country are supported by exports. Because the United States buys about three-quarters of our exports, it is safe to assume that a large majority of these jobs are based on Canadian industries being able to produce for and sell into the giant American market.
In examining the linkages between Canadian exports and domestic employment, Statistics Canada distinguishes between “direct” and “indirect” jobs. Direct jobs are those found in Canadian export industries – e.g., oil and gas producers, lumber companies, and equipment manufacturers, to name a few. Indirect export-dependent jobs are generated in the various “upstream” domestic industries that supply inputs to Canadian exporters. In 2023, there were 2.15 million direct and 1.81 million indirect jobs “embodied” in Canada’s exports – a total of 3.96 million jobs – according to Statistics Canada. The latter figure is up from 3.12 million jobs a decade earlier.
Focus on B.C. and Alberta
A similar analysis can be performed for the individual provinces.
In the case of British Columbia, Statistics Canada counts 444,000 jobs “embodied” in the province’s exports – adding together both direct and indirect jobs. The first figure shows the number of export-supported B.C. jobs in five broadly-defined industry sectors. It should be noted that the category of “manufacturing” captures a significant number of jobs in B.C.’s large and diverse forest products industry (e.g., wood products manufacturing, pulp and paper, newsprint, and engineered wood products). Transportation & warehousing includes some direct exporting businesses but also jobs in other companies which provide inputs to B.C. firms engaged in exporting activity. The same is true of wholesale trade and professional, scientific and technical services. Mining & oil and gas encompass export-dependent jobs in all parts of the B.C. mining industry plus export-supported jobs in oil and natural gas extraction. With the ramping up of LNG production and several new mines under development in B.C., the number of export-dependent jobs can be expected to grow in the future.
Figure 1
Turning to Alberta, some 441,000 jobs are supported by the province’s exports. The second figure shows how these jobs are distributed across five broad industry categories. Oil and gas extraction (which includes mining) tops the list, followed by manufacturing and transportation & warehousing.
Figure 2
Unfortunately, Statistics Canada does not provide estimates for export-dependent jobs in the provinces at a finer level of industry detail.
Many jobs in B.C. and Alberta that are closely linked to exporting pay above-average wages/salaries and therefore contribute disproportionately to aggregate employment income –and to the consumer spending that this income enables. In addition, it should not be forgotten that export-oriented industries generally boast relatively high levels of productivity (which is necessary to support high wages).
The bottom line is that for small open economies like B.C. and Alberta (and indeed Canada), commercially successful export-focused industries are vital to sustaining and increasing overall prosperity.