For the first time in nearly 50 years, longshoremen on the East and Gulf coasts went on strike Tuesday, cutting off most trade through some of America’s busiest ports and chilling the economy.
Members of the International Longshoremen’s Association union, which represents approximately 45,000 workers, began the strike after 11th-hour talks failed to avert a strike.
“Nothing will move without us—nothing,” said Harold J. Daggett, the union’s president, spoke to pickets outside a port terminal in Elizabeth, NJ. Video It was posted on the union’s Facebook account early Tuesday morning.
The United States Maritime Alliance, which represents port employers, declined to comment early Tuesday. The two sides disagreed on wage increases, and the use of new technology at the ports was a sticking point for the union.
Businesses are facing uncertain times right now. Trade experts say a short strike would cause little lasting damage, but a week-long strike could lead to shortages, higher prices and layoffs.
“When we’re talking about a two- to three-week strike,” said J. Bruce Chan, a transportation analyst at Wall Street firm Stifel, “that’s when the problem starts to get exponentially worse.”
The prospect of significant economic damage from a strike has left President Biden in a quandary five weeks before a national election. Before the strike, he said he would not use a federal labor law to force the port’s closure — a 2002 move by President George W. Bush did — but some labor experts said he could use that power if a strike began. Weigh the economy. White House officials pressed the two sides for a deal before the strike.
Longshoremen move containers from ships, sort them and place them on trucks or trains, handling bulk cargo. About three-fifths of the nation’s containerized exports pass through ports on the East and Gulf coasts, including the Port of New York and New Jersey, the nation’s third-busiest ports, and the fastest-growing ports in Virginia, Georgia, and Texas.
A strike would halt shipments of cars and heavy machinery through the Port of Baltimore, where operations were curtailed for much of the spring after a container ship collided with the Francis Scott Key Bridge.
Automakers said they were monitoring the strike, but it was too early to say how it would affect them.
Cruise ship operations will not be affected by the strike, and military exports will continue. Rick Cotton, executive director of the Port Authority of New York and New Jersey, said Monday that about 100,000 containers will be stored at the port during the strike and 35 ships arriving next week will be anchored offshore.
“The stakes are very high,” New York Gov. Cathy Hochul said at a news conference on Monday. “The possibility of a ban is significant.” But he also sought to reassure consumers, saying shortages of food and pharmaceuticals were not expected.
Ports do not have an alternative procedure for bringing bulk goods in and out of the country. Ports cannot operate without longshoremen, giving them strong leverage in labor negotiations.
West Coast ports are open. Longshoremen there belong to a different union and agreed to a new contract last year that included a significant increase in wages.
Under the contract that expired Monday, longshoremen on the East and Gulf coasts received a higher rate of $39 an hour. The ILA wants to raise wages by $5 an hour in each of the six years of a new contract, a 77 percent increase over the life of the contract.
The two sides had not been in touch for months before the walkout. But in recent days, the Maritime Alliance on Monday offered to extend the contract with the ILA by “trading counter-offers on wages”. The alliance also said its latest offer to the union would raise wages by “almost 50 percent” during the contract.
In a statement Tuesday morning, the ILA said the coalition’s offer “fell far short” of its members’ demands.
Through overtime and shift work, many longshoremen earn more than $100,000 a year, putting them ahead of other workers without a college degree. But they say they put in longer hours than workers in other jobs earning the same amount, and often do so in harsh or dangerous conditions.
High inflation over the past few years has reduced the purchasing power of their wages. Longshoremen argue that their employers — some of them major global shipping lines — are entitled to a share of the increased profits during pandemic trade booms in 2021 and 2022.
“They want to make their billions of dollars in profits in United States ports and off the backs of American ILA longshore workers, and they want to take those profits out of this country,” said union president Mr. Daggett said in a statement Monday.
Aware of the possibility of a strike, many companies rushed to stock merchandise ahead of Tuesday, including consumer durables they plan to sell during the holiday sales season. But even a short strike can affect importers of perishable goods like fruit.
Daniel J., chief operating officer of Top Banana, a fruit distributor based at Hunts Point Produce Market in the Bronx. Parabino said his main product, bananas, would run out by the end of next week due to the strike. “It will be for everyone in the region, all the banana importers – nobody is going to get the fruit,” he said.
It is very expensive to send fruits by air, Mr. Parabino added. He also said that the shortfall cannot be covered by the sale of produce other than bananas. “They pay the coffee bill, maybe the water bottle, but they don’t pay the electric bill, the rent, the truck lease or the employee salary,” he said.
The ILA last broke out of all Eastern and Gulf Coast ports in 1977, disrupting container shipping for more than six weeks. The agreement that ended the strike included proposed wage increases by employers, increased contributions to pension plans and measures to address the ILA’s concerns that new technology could cause job losses.
The ILA is still fighting against automation. It broke off talks with the Maritime Alliance in June after a port in Mobile, Ala., said it was inspecting trucks using technology not authorized under its labor contract. (The technology has been in use since the port opened in 2008, a source familiar with its operations said.)
Under the expired agreement, port operators were allowed to use “semi-automated” technology, but not “human interaction” equipment. The Maritime Alliance said it had offered in recent negotiations to carry that commitment into a new agreement.
Recently, other unions have won much of what they asked for in contract negotiations, and labor experts said the ILA hopes to capitalize on that success.
“The union showed up to fight hard,” Harley said Shaiken is a professor emeritus at the University of California, Berkeley, specializing in labor and trade. “The Employers’ Association is also well aware of the wider context in which strikes have been granted to unions over the last year or so.”
Neil E. Boudette Contributed report.
