As global trade disputes intensify, the trickle-down effect of destabilised supply chains amid existing domestic economic challenges threatens to drive demonstrations and strikes across the US, Canada, Mexico and Europe. Neil Mugabe and Erin Drake examine how continued volatility in the trade landscape could drive instability in the coming year.
Amid elevated geopolitical tensions, major players like the US, China and EU have leveraged economic statecraft – including tariffs and trade pressure – to further strategic goals. In 2025, for example, under President Donald Trump, the US pursued a multi-layered tariff strategy to improve the country’s USD 904 billion foreign trade deficit, reshape global trade to re-shore manufacturing to the US and drive economic growth. While key US trading partners like China, Canada and Europe responded with reciprocal tariffs, deeply integrated supply chains subsequently led them to seek more favourable deals with the US. However, across North America and Europe, heightened economic and trade volatility have merged with various domestic economic challenges facing households and businesses. Over the coming year, these dynamics collectively have the potential to drive strikes and unrest in countries exposed to shifting geopolitical forces.
According to White House statements, the US administration’s tariff strategy under the International Emergency Economic Powers Act views tariffs as a tool to rebuild longer-term economic and national security through strengthening domestic industries and addressing “the absence of reciprocity in our bilateral trade relationships.” In February 2025, the US imposed 25 percent tariffs on Canada and Mexico, and 10 percent on China, for “the extraordinary threat posed by illegal aliens and drugs,” and on 2 April, the US imposed ‘reciprocal’ tariffs on nearly all countries, although since then the US has struck deals with several governments to reduce these in exchange for trade benefits. Amid competition with China over technology and market access to rare earth metals and following months of escalating tariffs imposed by both sides, presidents Trump and Xi Jinping agreed in November to suspend reciprocal tariff increases until 2026, although several other tariffs remain in place.
The coming year will likely be characterised by continued trade volatility and supply chain disruptions as economies adjust, and in some cases, form new trade alliances. For instance, concerns have emerged among major industry stakeholders over the continuation of trade agreements like the US-Mexico-Canada free-trade agreement (USMCA), scheduled for revision in 2026, with over 500 US business groups and chambers of commerce urging the agreement’s continuation following US Trade Representative Jamieson Greer’s comments that President Trump may decide to withdraw. Reciprocal tariffs now also face a 2026 Supreme Court ruling on their legality, although the administration reportedly retains options for maintaining tariffs.
While the International Monetary Fund indicated in October that negotiated trade deals helped to limit tariffs’ impact on global growth estimates for 2025/6, “risks remain tilted to the downside” mainly due to tariff uncertainty. Given competing interests among governments, industries and other stakeholders, and an expanding use of economic statecraft in geopolitical relations, continued uncertainty and the disruptive economic and social impact of tariffs will likely continue to reverberate across countries and industries in 2026.
Critical industries including manufacturing, logistics and agriculture have borne the brunt of the impact of trade tensions, with companies and labour unions raising concerns over decreased product competitiveness, layoffs and longer-term workforce reductions. These dynamics place further pressure on governments already challenged by cost-of-living and labour grievances, elevating the potential for unrest.
Opposition to the administration’s tariff strategy and other policies, such as welfare reform and immigration enforcement, has prompted occasional smaller protests by activist groups across various cities, including under the banners of ‘No Kings’ and ‘Workers over Billionaires.’ Some coordinated demonstrations have seen high turnouts, including ‘No Kings’ protests in June and October in which organisers and media reported mass participation across all 50 states. As affordability remains a central concern ahead of the 2026 midterm elections, increases in costs of basic goods could galvanise more frequent protests among voters. While consumer spending grew at a rate of 3 percent from July to September 2025, New York’s Federal Reserve Bank data shows greater household debt – including on mortgages, car loans and credit card debt – while businesses have reported delaying passing down tariff-related costs. Together, these factors could contribute to household budget stress in the coming year.
Unions and businesses have cautioned that tariffs threaten jobs and profits, particularly in import/export-oriented sectors like logistics, retail, agriculture, and manufacturing. The manufacturing industry experienced strikes amid higher input prices and falling orders, with some companies citing tariffs as contributing to staff reductions. For example, soybean farmers, have faced increased machinery and fertiliser costs, and lower profits as Chinese soybean purchases fell in 2025. President Trump announced a USD 12 billion relief package for farmers in November, and negotiated a deal under which China resumed soybean purchases, stating that “maximising domestic farm production is a big part of how we will make America affordable again and bring down grocery prices.” While the administration’s tariff strategy is part of a long-term industrial policy to support US manufacturing and industry, any wider benefits to the economy are likely to take some time to emerge.
Unions remain concerned over the impact of US-China trade tensions on jobs among warehouse and dock workers; following an initial 145 percent tariff on Chinese imports in April, and a reciprocal 125 percent Chinese tariff on US goods, imports at Los Angeles Port dropped by 9 percent year-on-year in May. The International Longshore Workers Union (ILWU) reported that this prompted job losses for part-time workers. These pressures come as increasing automation at ports and warehouses has prompted layoffs in the sector, driving disruptive strikes among 50,000 unionised East and Gulf Coast port workers in October 2024. With cargo imports projected to slow in 2026 in part due to tariff uncertainty, and the automation issue largely unresolved, further headwinds could see job-related grievances deepen.
Responding to US tariffs, the Canadian government in March 2025 imposed levies on US goods, and anti-tariff protests have taken place outside Ottawa, Winnipeg and Vancouver. While the USMCA protects most US-Canada trade, and US tariffs on imported Canadian goods have predominantly affected specific products such as automotives (25 percent) and metals (50 percent), reduced export demands have led to job losses in these sectors in 2025, with Statistics Canada reporting 58,000 fewer manufacturing jobs between January and August. Bilateral trade negotiations between the US and Canada collapsed in October, leaving the issue unresolved as we enter 2026.
Canada’s automotive manufacturing and electric vehicle sector have seen jobs threatened across the sector and particularly in Ontario, where a major vehicle manufacturer recently announced plans to relocate a plant from Brampton to Illinois, laying off 3,000 workers. In 2025, hundreds of workers rallied outside plants over layoffs, while others held strikes demanding job security and government protection for workers. Over the coming months, the US will likely continue to place pressure on firms to relocate production to the US, sustaining potential for further layoffs and associated union activism in Canada’s manufacturing sector.
With over 80 percent of exports – particularly manufacturing, agriculture and medical equipment – heading to the US in 2024, Mexico is uniquely exposed to US-China tensions, as the US administration remains critical of what is says are Chinese companies using Mexico as a backdoor entry to the US. Ahead of the USMCA review in 2026, President Claudia Sheinbaum’s administration has sought to reorientate its broader trade posture towards North American supply chains; on 11 December, Mexico’s Congress passed a 50 percent tariff on Chinese and other Asian imports beginning 1 January 2026, which it hopes will offset US tariffs, including a 50 percent tariff on Mexican steel. According to Mexico’s Finance Ministry, this will generate an additional USD 2.8 billion in import revenue in 2026, but the bill received substantial domestic pushback from industries reliant on Chinese imports, and from opposition parties concerned over limiting Mexico’s trade diversification. Although it was considerably revised, goods like clothing, steel, aluminium, and auto parts remain exposed.
Workers across the agricultural and manufacturing sectors held strikes and protests to denounce the impact of tariffs in industries including sugar, automotives and textiles in 2025. On Labour Day (1 May), an estimated 50,000 people led by manufacturing and other unions protested in Puebla, a major automotive manufacturing hub, to denounce US tariffs and call on the government to protect affected sectors.
Both sectors face added challenges stemming from Mexico’s national water crisis and a longstanding dispute with the US over a 1944 water treaty, which escalated in December 2025 as President Trump threatened a five percent additional tariff if Mexico fails to deliver a backlog from the Rio Grande river to Texan farmers facing droughts. However, Sheinbaum’s promise to deliver under the treaty risks exacerbating local tensions; as manufacturing jobs remain precarious, water shortages have already disrupted chemical and manufacturing plants in Mexico’s northern states. In November and December, farmers and truckers blockaded highways in several states, including at the Ciudad Juárez–El Paso border crossing, in response to an unpopular General Water Law that would grant the government control over water management. Should the government restrict water use in agriculture, or divert water from farms to the US, this will likely drive further disruptive unrest.
US tariffs (including 15 percent levies on all goods), and EU-China tariff tensions over China’s growing competitive electric vehicle industry, have exacerbated challenges for member states facing high energy costs and obligations to boost defence spending. Despite the EU Commission’s claims that an August 2025 EU–US trade agreement prevents an escalation of trade tensions, unions have cautioned that the deal erodes competitiveness, while the Commission anticipates job losses of between 135,000 and 450,000, in the wholesale, machinery, automotive and pharmaceutical sectors. These dynamics signal longer-term drivers of pickets and strikes, particularly if governments are unable to also cushion the impact of domestic economic challenges like high living costs and unemployment.
According to EU agri-cooperative Copa‑Cogeca, French and German farmers are especially impacted by the US-EU deal. To offset this, the EU signed a free-trade agreement with South America’s Mercosur bloc in September. But this has triggered protests and strikes among powerful French farming unions, who have staged road blockades in southern France, arguing that imported goods are exempt from extensive environmental regulations and production standards that drive up local costs.
Germany’s automotive industry has also been hard-hit; major car manufacturers report export losses from tariffs and have announced plans for wage and workforce reductions in the coming years. Already, around 51,500 jobs were cut between June 2024 and June 2025, and companies faced strikes over wage demands even before US tariffs. The EU plans to phase out combustion engines by 2035; coupled with tariff pressure and growing Chinese competition in the EV space, this could drive headwinds and unrest in the automotive sector.