Threat of strike looms large over East, Gulf Coast ports
There’s an increasing abundance of skittishness surrounding the future of East and Gulf Coast ports.
The labor contract between the International Longshoremen’s Association and the United States Maritime Alliance (USMX) is set to expire at the end of September. The ILA represents some 70,000 dockworkers, while the USMX represents employers at 36 coastal ports — including three of the U.S.’s five busiest ports: the Port of New York and New Jersey, the Port of Savannah, Georgia, and the Port of Houston.
Contract negotiations between the ILA and the USMX began in February 2023 but quickly foundered on the issue of wage increases. Developments since then have not been promising.
‘Talk of potential disruptions has increased’
In November, ILA leadership warned roughly 45,000 of its members to “prepare for the possibility of a coastwide strike in October 2024,” after the current master contract expires. ILA President Harold Daggett also cautioned that there is no chance of extending the current contract past the expiration date.
In other words, ILA dockworkers are fully prepared to swap pallet jacks for picket signs come Oct. 1.
Unsurprisingly, these threats unnerved trade associations like the National Retail Federation, which have actively voiced their desire to facilitate negotiations between the two parties. NRF President and CEO Matthew Shay, in a January letter, expressed concern “that the discussions have been on hold for months and talk of potential disruptions has increased.
“Even the threat of a disruption can have a negative economic impact on the covered ports,” Shay argued, “especially if cargo owners and other supply chain stakeholders believe that operations will be slowed or shut down during the all-important peak shipping season this fall.”
Other analysts concur: In a November post on LinkedIn, Vespucci Maritime CEO Lars Jensen wrote, “[T]he mere threat of a strike could cause shippers to pre-emptively move cargo to the West Coast. … The threat is likely not idle at all, but saber-rattling at this point is to be expected.”
In many ways, the ILA is riding on the numerous successes that labor had in recent years. In August, the Teamsters celebrated the ratification of a new agreement with UPS (albeit one with unintended side effects). After a 46-day strike against Ford, Stellantis and General Motors, the United Auto Workers union secured large pay raises and other benefits for its members last fall.
Source: freightwaves.com
