I stepped out of the rain-soaked municipal building in Hamilton, Ontario last Wednesday as Mayor Andrea Horwath’s words lingered in the air: “catastrophic.” Not the kind of language politicians typically deploy unless they’re truly alarmed. The steel city of roughly 570,000 people sits on the western edge of Lake Ontario, where blast furnaces have shaped both the skyline and the community’s identity for generations.
“These tariffs would devastate Hamilton’s economy,” Horwath told me during our interview in her office overlooking the harbor where ships deliver iron ore to feed the steel mills. “We’re talking about thousands of jobs, families, and an entire regional economy that still revolves around steel.”
President Trump’s announcement last week promising to impose 25% tariffs on Canadian steel and aluminum if reelected sent immediate shockwaves through manufacturing communities across the border. For Hamilton, where approximately 10,000 jobs connect directly to steel production and processing, the threat cuts especially deep.
“People here remember 2018,” said Tony DiMatteo, a third-generation steelworker at Dofasco, now owned by ArcelorMittal. “The last time Trump did this, we had layoffs, uncertainty. Some people lost their homes waiting for things to stabilize.”
The memory DiMatteo references isn’t ancient history. When the Trump administration imposed similar tariffs in 2018, citing national security concerns under Section 232 of the Trade Expansion Act, the effects rippled through both countries’ economies. Canada responded with retaliatory tariffs on American goods worth $12.6 billion.
Data from Statistics Canada showed Hamilton’s manufacturing sector contracted by nearly 4% during that period, even as both governments eventually negotiated exemptions. The psychological impact, however, lasted much longer.
“The damage goes beyond just the immediate job losses,” explained Dr. Marvin Ryder, professor of business at McMaster University in Hamilton. “When companies face this kind of uncertainty, they postpone investments, expansion plans get shelved, and the innovation that keeps industries competitive stalls out.”
According to a report from the C.D. Howe Institute, the 2018-2019 tariff dispute cost Canada’s economy nearly $3 billion and threatened nearly 6,000 jobs nationwide. Hamilton absorbed a disproportionate share of that impact.
What makes the current threat particularly concerning for Canadian officials is how it undermines the USMCA trade agreement – the very deal Trump himself negotiated to replace NAFTA. The agreement, which took effect in 2020, was supposed to provide stability and predictability for North American trade relations.
“We designed a trade agreement specifically to prevent these kinds of arbitrary actions,” said Chrystia Freeland, Canada’s Deputy Prime Minister, speaking to reporters in Ottawa yesterday. “Using national security as justification to target your closest ally and defense partner isn’t just economically harmful – it damages the trust that makes our shared continental security possible.”
Hamilton’s economy has diversified somewhat in recent decades, with healthcare and education growing as employment sectors. McMaster University and Hamilton Health Sciences now rank among the city’s largest employers. But steel remains woven into Hamilton’s identity and economic foundation.
Walking through the north end neighborhoods near the steel plants, I met Jamie Kendrick, whose family-owned machine shop supplies parts to both Stelco and Dofasco. “My grandfather, my father, now me – we’ve all made our living because of steel,” he said, gesturing toward the plumes rising from the mills. “We survived 2018, but another round of this? I’m not sure some of these smaller businesses can take it.”
The potential tariffs would arrive at a particularly vulnerable moment. Canadian steel producers, like their global counterparts, have already been grappling with overcapacity issues, particularly from Chinese production. Industry publication Steel Market Update reports that North American steel prices have fallen approximately 11% since January, creating additional pressure on producers.
The economic ripple effects extend beyond Hamilton’s city limits. The regional supply chain encompasses hundreds of businesses across southern Ontario that provide transportation, maintenance services, and components to the steel industry.
Mayor Horwath emphasized this interconnectedness: “When the steel industry catches a cold, our entire region gets pneumonia. The impact touches everything from restaurants where workers eat lunch to housing markets and municipal tax revenues.”
The Canadian government has signaled it would respond forcefully to new tariffs. Trade Minister Mary Ng stated that Canada would “always stand up for our workers and industry,” suggesting retaliatory measures would be forthcoming if tariffs were imposed.
For citizens in border communities like Hamilton, the situation highlights the perpetual vulnerability that comes with having the world’s largest economy as your neighbor and primary trading partner.
“We’ve been down this road before,” reflected Peter Warrian, senior research fellow at the Munk School of Global Affairs and a former research director for the United Steelworkers of Canada. “What’s different now is that we’ve seen the playbook. Canadian industry and government learned valuable lessons about supply chains, market diversification, and response strategies during the last tariff dispute.”
Those lessons may soon be put to the test again. As I left Hamilton, passing under the skyway bridge with its view of the harbor and steel mills, the massive industrial complex looked both imposing and vulnerable – much like the city’s economic future under the shadow of renewed trade tensions.
