Overview
The U.S. tariffs may have a negative impact on the cost of living for everyday Canadians and Americans. The tariffs are essentially a tax on imported goods, which will be passed on to consumers. As Canada puts retaliatory tariffs in place, both sides of the border may be affected. As usual, it is not the politicians who pay the price for their decision-making.
In this article, we’ll review five unexpected impacts of the U.S. tariffs on the Canadian economy as well as five tips for coping with the crisis as an average Canadian consumer.
How Tariffs Work
Tariffs are essentially a tax on imported goods, intended to boost the sales of domestic products. The U.S. administration has decided to impose tariffs on a large number of countries, not just Canada, in an effort to encourage Americans to buy American.
In practice, the higher costs will be passed on to consumers, resulting in worsening affordability issues in an already-strained economy. Individuals earning low to modest incomes already are struggling to afford basic expenses, so the tariffs will exert further pressure.
Canadians may also be significantly impacted as Canada responds with retaliatory tariffs and bottom lines dwindle.
Let’s review five impacts the U.S. tariffs may have on the Canadian economy and everyday Canadians.
The Impact on the Job Market
As affected industries shrink and/or experience disruptions, significant job losses may result. Employment opportunities and job security may become greatly diminished due to the ongoing trade war. Both sides of the border may suffer.
The Impact on the Cost of Living
The U.S. tariffs and reciprocal tariffs may increase the cost of various goods. This may result in a higher cost of living. Canadians and Americans are already struggling with low incomes and high expenses, so the tariffs may only add gasoline to a raging fire.
The Impact on the U.S.-Canada Relations
The U.S. tariffs have introduced uncertainty and conflict into the U.S.-Canada relations. Canada no longer sees the U.S. as a reliable trading partner. However, historically, Canada and the U.S. have been the closest allies and trading partners. This means the tariffs are exerting negative pressure on an important long-term economic alliance.
Buying Local
As Canada responds with reciprocal tariffs, the cost of American goods may increase. In some cases, Canadians may be encouraged to buy locally or domestically produced goods. This may not be entirely a negative development, as it may boost sales of domestic products.
Discouraged Investors
Due to the uncertain economic climate, investors may feel discouraged from investing in Canadian businesses reliant on exports to the U.S. This may further slow economic growth and reduce job numbers.
In the next section, we’ll review five tips to deal with the economic crisis.
How to Cope with the Crisis: 5 Tips
Now let’s look at five tips to cope as a Canadian consumer:
- Buy Canadian. As the cost of American goods increases, Canadian-made goods may offer a more affordable alternative.
- Develop an effective budget. Track every single cent of your spending. See where you’re spending too much. Consider whether your income may be directed to more productive causes. Revise your budget every month.
- Minimize pleasure spending. This may help boost savings in the long term.
- Buy in bulk. If you know the price of your favourite product will increase, buy it in bulk beforehand.
- Sign up for Credit Verify. It will help you monitor your credit health and automatically detect errors on your credit report. This, in turn, may improve your credit health in these uncertain times.
In the next section, we’ll look at how online installment loans may help Canadians deal with expenses.
How Can Online Installment Loans Help?
Online installment loans may provide quick funds to help cover almost any expense, within reason. Featuring a simple and quick online application process and no credit check, online installment loans are typically repaid over several installments, including applicable interest and fees.
Final Thoughts
Canada and the U.S. are getting into stormy economic waters and worsening affordability challenges. If you need help covering urgent expenses, apply for an online installment loan via Friendly Lender. We don’t check your credit score or credit report during the simple online application process. Instant Bank Verification (IBV) may be used to confirm banking details. Funds may be deposited directly into your bank account in as little as 24 hours!
