Longshoremen from Maine to Texas began walking picket lines early Tuesday in a strike over wages and automation. If the strike continues for more than a few weeks, inflation could reignite and shortages could arise.
The contract between the port and some 45,000 members of the International Longshoremen's Association expired at midnight, and workers went on strike despite reports of progress in negotiations on Monday.
The strike, which affects 36 ports, is the first union-led strike since 1977.
Workers began picketing the Port of Philadelphia after midnight, walking in a circle at a railroad crossing outside the port and chanting, “No work without a fair contract.”
The union had a message board on the side of the truck that read, “Automation hurts families: ILA stands for job protection.”
The U.S. Maritime Alliance, which represents the ports, announced Monday night that both sides had withdrawn their previous wage offers, but it was clear no agreement had been reached when picket lines were set up just after midnight.
The union's initial offer in negotiations was for a 77% pay increase over the six years of the contract, which President Harold Daggett said would be needed to compensate for inflation and years of small pay increases.
ILA members earn a base salary of about $81,000 a year, but some earn more than $200,000 a year with generous overtime pay.
But on Monday night, the alliance announced it had increased its offer to 50% raises over six years and promised to maintain automation limits from the old contract.
Labor unions are calling for a complete ban on automation. It is unclear how far apart the two sides are.
“We hope this will allow us to fully resume collective bargaining on other outstanding issues to reach an agreement,” the alliance statement said.
The union did not respond to a request for comment on Monday night's talks, but earlier in the day the port had rejected demands for a fair contract and the union said it appeared it intended to strike. The two sides have not held formal negotiations since June.
The coalition said its proposal would triple employer contributions to retirement plans and strengthen health care options.
During the day on Monday, some ports were already preparing for a strike. The Port of Virginia, for example, was in the midst of a shutdown.
Accepted the last inbound train for delivery at 8 a.m., closed the inbound truck gates at noon, and required ships to depart by 1 p.m. Cargo operations ceased at 6 p.m.
“We are treating this issue as we would any time there is a potential hurricane,” port spokesman Joe Harris told The Associated Press.
“And we'll get back online, just like when you recover from a hurricane. We have an experienced team. We've done this in the past.”
Supply chain experts say consumers will not be immediately affected by the strike because most retailers have stocked up on goods and brought forward shipments of holiday gift items.
But if it lasts more than a few weeks, the work stoppage could cause significant disruption to the country's supply chain, leading to higher prices and delays in goods reaching homes and businesses.
If the strike is extended, businesses will be forced to pay delivery companies for delays and some goods will arrive late during the peak holiday shopping season, from toys and artificial Christmas trees to cars, coffee and fruit. Delivery of everything could be affected.
The strike is likely to have an almost immediate impact on the supply of fresh imports, such as bananas, for example.
According to the American Farm Bureau Federation, ports affected by the strike handle 3.8 million tons of bananas each year, or 75% of the nation's supply.
It also could disrupt exports from East Coast ports and cause traffic jams at West Coast ports, where workers are represented by different unions.
Railroads say they can transport more freight from the West Coast, but analysts say they won't be able to supplement the freight they handle on the East Coast.
Jay Dhokia, founder of supply chain management and logistics company Pro3PL, said: “If the strike goes ahead, it will cause significant delays throughout the supply chain, with ripple effects that will undoubtedly be felt in 2025 and across the industry.'' It will cause confusion.”
JPMorgan said the strike, which shut down ports on the East Coast and Gulf Coast, could cost the economy $3.8 billion to $4.5 billion a day, some of which would be recovered over time once normal operations resume. Then, the calculation is made.
The strike comes weeks before the presidential election, and any shortages could be a factor.
Retailers, auto parts suppliers and agricultural importers end their strikes either through a settlement or through the Taft-Hartley Act, which allows President Joe Biden to step in and require an 80-day cooling-off period. I was expecting that.
But in an interaction with reporters Sunday, Biden, who has been instrumental in voting union Democrats, said “no” when asked if he intended to intervene in a potential work stoppage.
White House officials said Monday that at Biden's direction, the administration has been in regular contact with the ILA and allies to move negotiations forward.
The President asked Chief of Staff Jeff Zients and National Economic Council Chairman Lael Brainerd to convene the alliance's board members on Monday afternoon to resolve the dispute fairly in a manner that takes into account the shipping companies' successes and contributions in recent years. He also instructed them to urge the issue to be resolved quickly. About union members.
