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WASHINGTON — Unions representing thousands of longshoremen from Maine to Texas went on strike Tuesday over wages and the use of automation, leading to work stoppages that threaten to cause significant disruption to trade and the national economy. The port was closed.
It was the first strike for the International Longshoremen’s Association since 1977, with its 47,000 members taking action at 30 ports on the East Coast and Gulf Coast, which together account for about half of all imports into the United States. In charge of freight transportation. Politically, the country is emerging from an era of high inflation, with national elections just a month away.
President Biden, who has championed the labor movement during his time in the White House, said he has no intention of calling off the strike. On Tuesday, he sided squarely with unions, urging the American Maritime Alliance, a group that primarily represents foreign shipping lines and other port employers, to “come to the table and present a fair offer to workers. issued a statement asking for the same. ”
“Ocean carriers have posted record profits since the pandemic, with profits in some cases increasing by more than 800% compared to pre-pandemic profits,” the president said, adding that management and shareholders have benefited. He pointed out that he was receiving “It stands to reason that the workers who have put themselves at risk during the pandemic to keep our ports open will also see significant wage increases.”
The Maritime Alliance had no immediate comment on Biden’s statement, but announced late Monday that it has proposed nearly 50% pay increases over six years. The union is demanding a 77% wage increase, and union leader Harold Daggett doubled down on that demand in a speech on the picket lines at the Ports of New York and New Jersey. The base wage for top-tier longshore workers is $39 an hour.
Business groups, including Republican Congress and the National Assembly. Manufacturing lawmakers called on Biden to invoke the 1947 Taft-Hartley Act to end the strike. President George W. Bush used that authority in 2002 to end an 11-day lockout of union members at West Coast ports.
Even if the strike ends soon, it is not expected to have a major impact on businesses or consumers. Many retailers shipped products earlier than usual and built up inventory in preparation for the labor movement. For example, many holiday accessories such as toys and Christmas ornaments arrived in late summer instead of the usual October, analysts said.
Some importers are shipping goods by air, while others are rerouting cargo to the West Coast, increasing traffic at the ports of Los Angeles and Long Beach, the nation’s busiest container complexes.
Economists say each day the strike continues will cost billions of dollars in trade losses, some of which could be recovered later. And if ports remain closed for more than a week or two, the economy will suffer more severe and far-reaching impacts, such as supply chain disruptions and increased logistics costs, similar to the early days of the pandemic.
Jason Miller, a supply chain management expert at Michigan State University, said the initial impact on consumers will be relatively minor and may even go unnoticed as prices for products such as wine and fresh produce like bananas in Europe become higher. He said there might be. But if enough imported parts and components aren’t available in the coming weeks, automakers that make cars in the U.S. could be forced to slow production or layoffs, he said. Through July, 56% of imported auto parts and 71% of cars came from the East Coast and Gulf Coast, according to Miller’s analysis of Census Bureau data.
“There’s a limit to what the system can handle. There’s only so much that can be repurposed,” he said.
Abandoned crane and shipping container seen in Bayonne, New Jersey
(Eduardo Muñoz Alvarez/Associated Press)
Thanks in part to cargo diversions, the ports of Los Angeles and Long Beach combined had their busiest August ever. Both ports are preparing for an increase in traffic in case of a strike.
“People have been preparing for this day for months,” said Port of Los Angeles Executive Director Gene Seroka. He said the port’s throughput through August increased by 17% compared to last year’s levels. “We just finished the third quarter, and it’s going to be the best ever.”
Longshoremen on the West Coast are represented by another union, the International Longshore and Warehouse Workers Union (ILWU), which has agreed to a new contract with the Pacific Maritime Association. last year.
A union spokesperson said Tuesday that the ILWU has no public comment on the strike at this time. ILWU President William Adams previously sent a letter to Daggett pledging solidarity with East Coast unions and joined picket lines on the East Coast on Tuesday in a symbolic show of support.
But West Coast longshoremen could not simply refuse to unload product diverted from the East in a show of solidarity. This is because the cargo’s destination is booked before the ship sets sail, otherwise it is difficult to know where the cargo is going. California port operations could be affected if eastern coast unions set up pickets here, as they did in San Francisco during the 1977 strike. However, even then, the ILWU’s actions may be constrained by contractual rules.
An ILWU spokesperson said he had not heard of any plans for Eastern Union to come to West Coast ports.
The Ports of Los Angeles and Long Beach report they have the capacity to handle more cargo rerouted from the East, but increased volumes could create bottlenecks.
“West Coast port operators have learned to operate under intense pressure as they resume trade after pandemic-era distortions,” said Joseph Brusuelas, chief economist at tax and consulting firm RSM US. said. “We think this will partially alleviate some of these issues.” [effects] It would have a negative impact on trade volumes during the period of the labor movement. ”
Bruellus estimated that the strike would impact exports by about $1.3 billion and imports by $3 billion per day, which remains modest given the size of the U.S. economy. “The main industries affected by this measure will be local transport, warehousing and vehicle imports,” he said. “Agricultural products, coal and oil will be the most affected in the short term.”
The impact would be greatest where the largest ports are home or supported along the Atlantic and Gulf coasts, including New York and New Jersey. Savannah, Georgia. Houston. The Port of New York and New Jersey, the East Coast’s busiest, said it has 100,000 containers waiting to be unloaded and 35 ships expected to arrive this week. The Port of Seroka, LA, said even a short strike that closes the port for just a week can take four to six weeks to clear the backlog.
If the strike continues for a long time, prices could rise even further, leading to shortages during the year-end sales season. California companies say that while the strike is likely not too severe, they expect consumers to end up paying the costs.
Third-generation longshoreman Ray Bailey Jr., a trustee of ILA Local 1291, encourages picketers outside Philadelphia’s Packer Avenue Marine Terminal.
(Ryan Corrado/Associated Press)
“If we have learned anything from previous supply chain disruptions, it is that they will result in higher costs for consumers, including clothing, fruits, vegetables, and medical supplies,” Los Angeles Customs Brokers said. said Patti Chaepe, president of And Los Angeles Customs Brokerage. freight forwarders association
Members began picketing on Tuesday after a six-year labor contract with the International Longshoremen United States Maritime Alliance expired at midnight.
Unions have strongly opposed employers who want to use robotics and other labor-saving technologies. The coalition announced on Monday that it proposed retaining the current language on automation and semi-automation.
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