Washington – New economic analysis prepared for Business Roundtable concludes that termination of the North American Free Trade Agreement (NAFTA) would result in the net loss of 1.8 million U.S. jobs within the first year. The study – prepared by Trade Partnership Worldwide, LLC – quantifies the harmful impacts of NAFTA withdrawal by examining how the re-imposition of "most-favored-nation" tariffs on U.S. trade with Mexico and Canada would affect the U.S. economy. This decrease in employment is due to direct and indirect impacts of re-imposing these tariff rates, far outweighing any potential employment increases. 

“Terminating NAFTA would permanently reduce U.S. employment, exports, and economic output, while benefiting our economic competitors at the expense of American workers and businesses,” said Joshua Bolten, President & CEO of Business Roundtable. “We urge the Administration to take into account the potential damage of withdrawing from NAFTA, and to focus instead on modernizing the agreement so that it remains a cornerstone of American prosperity.”

The analysis also shows that withdrawing from NAFTA would:

• Reduce U.S. exports to Canada and Mexico by 17.4 percent each and lower American companies' global exports by 2.5 percent, as higher tariffs make American companies less competitive in the global market.

• Diminish American households' purchasing power by almost $654 per household due to higher prices and lower wages caused by increased tariffs.

• Shift economic activity away from North America and toward our economic competitors, including China, which would experience a GDP increase of 0.2 percent and a 2 million increase in employment.

For more information on the impact of NAFTA withdrawal, visit BRT.org/nafta-facts.