It’s been four years since the United States signed onto the United States-Mexico-Canada agreement, or USMCA. The revision of NAFTA has been less controversial than the original agreement was, but current disputes and concerns have caused some to question whether or not the USMCA benefits US interests like we were told it would. Recent fears over China manipulating the USMCA to import EVs to the US have even prompted a discussion about ending the trade agreement.
However, after four years, the data shows distinctly that the USMCA benefits US workers in measurable and clear ways, boosting the US economy and strengthening economic ties between member nations. Without a doubt, international trade maximizes efficiency and leverages regional strengths to reduce prices for the consumer. This in turn creates more jobs, increases average wages, and benefits workers in all signatory countries.
As we near the mandatory review in 2026, with several years of trade data, it’s clear the USMCA has proven its worth. The USMCA benefits US workers and the US economy at large.
In spite of a global health crisis, geopolitical disruptions, and supply chain catastrophes, US trade with Canada and Mexico in 2022 had risen to a record $1.78 trillion USD. This was a staggering 27% increase from 2019, the year before the trade agreement was signed.
Nearshoring to North America at large had risen 78% from 2021 to 2022, reflecting a growing movement for global manufacturers to bet on the North American trade bloc as a source of stability and cooperative interaction. Currently, the USMCA enjoys an 80% approval rating among US citizens. Still, in spite of its overwhelming success, there are some challenges that may reduce this popularity if not favorably resolved. Some of these disputes between members include:
US manufacturers understand how beneficial the USMCA has been for their companies and US trade. Mexico boasts several distinguishing assets that, as a USMCA signatory, benefit US manufacturing.
Because US companies can operate plants in Mexico and trade materials and finished goods across the border, duty free, the opportunities are abundant. As such, Mexico has beat out both China and Canada to become the top US trading partner. Some of these advantages of trading with Mexico include:
But it’s not just companies that thrive under the international free trade agreement shared with Canada and Mexico. US workers benefit directly from the provisions and increased trade brought about by USMCA.
And it’s not just in manufacturing. Service jobs in the United States have increased dramatically since free trade opened up since NAFTA, the original version of the USMCA. Since 1993, business services (from audiovisual to banking to architecture) exported to Canada and Mexico have tripled.
Farmers, ranchers, and small businesses haven’t been overlooked. Over 120,000 small businesses are now selling to Canada and Mexico. Agricultural exports to Canada and Mexico have now reached approximately $40 billion USD, representing one third of all agricultural exports.
Manufactured goods exported to Canada and Mexico, account for approximately 2 million jobs in the US. Overall exports to Canada and Mexico have created 12 million US jobs.
Indeed, most US states count either Canada or Mexico as their primary trade partner. 49 of them count one of them in their top three trading partners. Since 2007, 40% of the growth in US foreign exports came from US trade with Canada and Mexico.
The United States partners with Canada and Mexico to create a single, dynamic manufacturing hub to compete with other parts of the world. Partners, not competitors, these three nations are stronger as a result of the mutual cooperation achieved by this trade agreement. And this regional focus creates strengths that impact each member nation.
In our own country, the USMCA benefits US workers by creating demand for parts that are assembled in Mexico, by creating demand for US engineers and programmers to empower Canadian companies, and by allowing US companies to reduce costs and create higher paying positions here in the US.
The ways in which the USMCA benefits the US in its first four years are myriad. And when the 2026 review comes around, there will likely be minor updates. But the core agreement that binds these three nations will continue on in some iteration as long as these clear benefits remain.
