Heavy U.S. dependence and global uncertainty make diversification a national business priority.
Arcus Consulting Group – Economic Insights
1. Export model under pressure
Canada has long relied on exporting to the United States as a core pillar of economic growth. Yet business leaders must recognise that export performance and global trade dynamics are becoming less stable. According to a recent Statistics Canada release, in 2024 the number of Canadian enterprises exporting goods to the U.S declined and just over one-third (34.1 %) exported goods to non-U.S destinations. Statistics Canada
Manufacturing employment, which is closely tied to U.S. demand, accounts for about 8.9 % of total employment in Canada. Statistics Canada Firms must consider how exposed they are to U.S. demand, and how quickly they can pivot.
2. Critical data on trade and export vulnerability
| Metric | Latest value / change | Implication |
|---|---|---|
| Share of exporters who also export to non-US destinations | 34.1% in 2024. Statistics Canada | Low diversification beyond U.S. market. |
| Export value by SMEs (<500 employees) | SMEs generated 40% of goods exports in 2024. Statistics Canada | Indicates SMEs play large role, but large firms dominate value. |
| Manufacturing employment share | 8.9% of total employment (2024) Statistics Canada | Manufacturing is a non-trivial share and sensitive to export demand. |
3. Diversification: what business leaders should do
Understand exposure. Firms should map how much of their revenue depends on U.S. demand or inputs tied to U.S. policy. That includes tariffs, industrial-policy shifts or currency moves.
Target non-U.S. markets and value-chains. Whether it’s Asia-Pacific, Europe or Latin America — exploring export channels beyond the U.S. becomes a strategic imperative. New trade agreements, digital services exports and supply-chain re-runs are key.
Reshape value-chains. It’s not enough to find a new final market. Firms should re-evaluate where value is added: sourcing, production, logistics and after-sales. Smaller firms may need to partner or join export-consortia.
Engage with government/regulation. Business leaders should build relationships with regional and national trade-policy stakeholders: infrastructure (ports, rail), regulatory harmonisation and export-finance programmes.
4. Media narrative: what stories matter
For business media, the trade story should shift from “how many exports” to “how diversified and resilient are export models”. Features could profile companies that have successfully pivoted to non-U.S. markets, or supply-chains that now bypass U.S. bottlenecks.
5. Board-level questions for companies
- What percentage of our revenue (or value chain) is exposed to the U.S.?
- Which non-U.S. markets are feasible for us (both for exports and for sourcing)?
- What internal capabilities (distribution, logistics, compliance) need strengthening for diversification?
- What government programmes (export-finance, trade missions, infrastructure) can we leverage?
- How quickly can we re-route risk if U.S. demand falters or policy shifts?