Supreme Court Strikes Down Some Trump Tariffs, but Canadian Jobs Still at Risk

Canada’s fragile job market is unlikely to see immediate relief after the U.S. Supreme Court ruled against a key portion of former President Donald Trump’s tariff strategy, industry leaders and labour representatives say.

On Friday, the U.S. Supreme Court invalidated tariffs imposed under the International Emergency Economic Powers Act (IEEPA). The Trump administration had justified those duties by declaring national emergencies related to fentanyl trafficking and trade deficits, which were used to introduce so-called “reciprocal” tariffs on multiple countries, including Canada.

While the decision marks a legal setback for the former administration’s approach, Canadian labour groups caution that it does little to ease the economic strain already facing workers.

Unifor National President Lana Payne said the ruling exposes flaws in the legal foundation of the IEEPA-based tariffs but warned Canadians not to interpret the outcome as a breakthrough for domestic jobs. According to Payne, the threat to employment remains serious, especially if Washington pursues alternative trade measures targeting Canadian industries or investments.

Crucially, the Supreme Court decision does not affect tariffs introduced under Section 232 of U.S. trade law measures justified on national security grounds. These duties continue to apply to Canadian steel, aluminum, automobiles, auto parts and forestry products.

Those sectoral tariffs have weighed heavily on Canada’s economy, slowing growth and contributing to layoffs across several provinces. In recent weeks, General Motors reduced shifts at its Ontario facilities, resulting in hundreds of job losses, with further indirect employment impacts anticipated. Algoma Steel has also announced plans to cut more than 1,000 positions, citing tariff-related pressures.

Payne noted that the most harmful tariffs affecting Canada were never imposed under IEEPA. Instead, they stem from Section 232 provisions, which remain fully in force and could potentially be expanded.

Industry leaders say uncertainty rather than immediate policy shifts is now the dominant concern.

Jean Simard, President and CEO of the Aluminum Association of Canada, described the ruling as legally sound but economically complex. He said businesses and governments now face a period of waiting and reassessment, which could dampen trade confidence.

Trump signaled Friday afternoon that additional global tariffs of 10 per cent may be forthcoming, though specifics have not yet been outlined. That possibility adds to the unpredictability already shaping cross-border trade relations.

Simard emphasized that Canada’s aluminum sector has maintained production levels despite tariff headwinds over the past 18 months. He argued that American consumers and businesses ultimately bear much of the financial burden of U.S. tariffs, as higher metal prices strain domestic manufacturers.

According to Simard, while Canadian producers have adapted, elevated costs in the United States are pushing some American companies out of the market a dynamic he suggests may eventually weaken U.S. leverage in trade negotiations.

Ontario Premier Doug Ford described the court’s decision as an “important victory” but acknowledged that key tariffs continue to hurt workers in auto, steel, aluminum and forestry industries. He pledged to continue pressing for the removal of all remaining U.S. trade barriers against Canada.

As of publication, Prime Minister Mark Carney had not issued a formal response to the Supreme Court ruling or to the prospect of additional tariffs.

For now, economists and industry observers agree that the ruling offers limited practical benefit for Canada’s labour market. While it narrows the legal tools available for sweeping emergency-based tariffs, the more consequential national security duties remain untouched.

With additional tariffs potentially on the horizon and sectoral measures still in place, Canadian businesses and workers are bracing for continued uncertainty in the months ahead.