Tens of thousands of dockworkers have gone on strike at ports across much of the US. The strike threatens significant trade and economic disruption ahead of the presidential election and the busy holiday shopping season.
Port of Los Angeles Executive Director Gene Seroka sat down with Neil Cavuto of @FoxBusiness to discuss impacts of possible East Coast labor strike on the supply chain.https://t.co/CCqgCNMZxK #FoxBusiness
— Port of Los Angeles (@PortofLA) September 30, 2024
Members of the International Longshoremen’s Association (ILA) walked out on Tuesday at 14 major ports along the East and Gulf coasts.
This halted container traffic from Maine to Texas. The action marks the first such shutdown in almost 50 years. President Joe Biden has the power to suspend the strike for 80 days for further negotiations.
If workers at East and Gulf Coast ports strike on Oct. 1, manufacturing supply chains throughout the U.S. will be thrown into disarray. Billions of dollars of goods—from food to vehicles to electronics—rely on access to the East and Gulf Coast ports. https://t.co/iuV7et7dXk pic.twitter.com/PA75tnKeoX
— Jay Timmons (@JayTimmonsNAM) September 30, 2024
However, the White House has said he is not planning to act. Talks have been stalled for months, and the current contract between parties expired on Monday. The two sides are fighting over a six-year master contract that covers about 25,000 port workers.
“A short strike could have a limited economic impact given many companies have imported extra goods ahead of a possible work stoppage or shifted more shipments to West Coast ports. But a strike that continues for weeks could have serious economic impacts.” https://t.co/a3gk1hOX7d
— Valentin Aufrand, CFA (@ValentinAufrand) September 30, 2024
On Monday, USMX said it had increased its offer, which would raise wages by almost 50%. It would also triple employers’ contributions to pension plans and strengthen health care options.
Despite the calls from my @TransportGOP colleagues and I, the Biden-Harris Admin has failed to act in preventing a strike at East and Gulf Coast ports. This is inexcusable. Even a brief strike will impact the flow of goods and harm our nation's economy. https://t.co/4VeMcUgnSk
— Daniel Webster (@RepWebster) September 30, 2024
Union boss Harold Daggett has called for significant pay increases for his members while voicing concerns about threats from automation.
Under the previous contract, starting wages ranged from $20 to $39 per hour, depending on a worker’s experience. Workers also receive other benefits, such as bonuses connected to container trade.
Dockworkers strike threatens trade disruption
The union wants to see per-hour pay increase by five dollars per year over the six-year deal, which amounts to about 10% per year. Time-sensitive imports, such as food, are likely to be among the goods first impacted. The ports involved handle about 14% of agricultural exports shipped by sea and more than half of imports, including a significant share of trade in bananas and chocolate.
Other sectors exposed to disruption include tin, tobacco, and nicotine. Clothing and footwear firms and European carmakers, which route many of their shipments through the Port of Baltimore, will also take a hit. More than a third of exports and imports could be affected by the strike, hitting US economic growth to the tune of at least $4.5bn each week of the strike.
More than 100,000 people could find themselves temporarily out of work as the impact of the stoppage spreads. The standoff injects uncertainty into the US economy at a delicate time. The economy has been slower, and the unemployment rate is ticking higher as the US election approaches in six weeks.
The strike risks putting President Biden in a tricky spot. US presidents can intervene in labor disputes that threaten national security or safety by imposing an 80-day cooling-off period, forcing workers back on the job while negotiations continue. The US Chamber of Commerce business group has called on President Biden to take action.
The ILA’s Harold Daggett endorsed Democrat Biden in 2020, but has been critical of the president more recently. He met with Donald Trump in July. Although any strike chaos is likely to hurt Democrats, the cost of alienating allies in the labor movement just weeks before the election would be greater.
