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Dockworkers strike threatens US supply chain
Thousands of dockworkers from Maine to Texas have gone on strike, demanding a pay raise and fair working conditions. The strike threatens to disrupt the U.S. supply chain and could cost the economy more than $4 billion a day.
NEW JERSEY - Thirty-six U.S. ports, including ones in New York/New Jersey, shut down on Tuesday when the union representing around 45,000 dockworkers went on strike for the first time since 1977.
ILA STRIKE UPDATE: ISSUES l IMPACTS l HOLIDAY SHOPPING
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Workers began walking picket lines early Tuesday, picketing near ports all along the East Coast.
Port strike 2024: Map of affected locations, product impacts, updates
While any port can handle any type of goods, some ports are specialized to handle goods for a particular industry.
A lengthy shutdown could raise prices on goods around the country and potentially cause shortages and price increases at big and small retailers alike as the holiday shopping season approaches.
East Coast port strike 2024: What are the issues?
The International Longshoremen’s Association is demanding significantly higher wages and a total ban on the automation of cranes, gates and container-moving trucks that are used in the loading or unloading of freight at 36 U.S. ports. Those ports handle roughly half of the nations’ cargo from ships.
The contract between the ILA and the United States Maritime Alliance, which represents the ports, expired Tuesday. Some progress was reported in talks late Monday, but the union went on strike anyway.
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The union’s opening offer was for a 77% pay raise over the six-year life of the contract, with President Harold Daggett saying it’s necessary to make up for inflation and years of small raises. ILA members make a base salary of about $81,000 per year, but some can pull in over $200,000 annually with large amounts of overtime.
Monday evening, the alliance said it had increased its offer to 50% raises over six years, and it pledged to keep limits on automation in place from the old contract. The alliance also said its offer tripled employer contributions to retirement plans and strengthened health care options.
How will the strike affect consumers?
If drawn out, the strike would force businesses to pay shippers for delays and cause some goods to arrive late for peak holiday shopping season – potentially impacting delivery of anything from toys or artificial Christmas trees, to cars, plywood, coffee, fruit and vegetables.
Americans could also face higher prices as retailers feel the supply squeeze.
"Everyone from the shipping lines to trade groups and maritime industry analysts also warns of widespread ramifications in the global supply chain," reported The Maritime Executive, a maritime industry magazine and newsletter. "Sea-Intelligence has estimated that for each day of a strike, it would take four to six days to clear the backlog. They wrote that even a two-week strike could have ramifications into 2025."
In addition, according to the American Farm Bureau Federation, the affected ports handled 75% of the country's banana imports.
How will a strike affect holiday shopping?
Chris Butler, CEO of National Tree Company in New Jersey, tells the AP that if a strike lasts only a few days, there would still be time to unload Christmas trees, transport them to warehouses, and prepare them for customers this season.
Ships carrying the trees were en route to New York but wouldn't arrive before Tuesday. If the strike continues, Butler warned that most trees would have to be stored until next Christmas season.
Here's how the port strike could affect the holidays
This holiday season might be a little less merry —with Christmas trees and holiday goods stuck in transit. Experts warn that more than a month could cause product shortages.
If a strike keeps ports closed until November, about 150,000 Christmas trees could miss the peak shopping season, costing National Tree Company and others. In the worst case, these costs could drive inflation and strain the U.S. economy.
A prolonged strike would require companies to compensate shippers for delays, potentially causing goods to arrive late for the peak holiday shopping season.
MAE ANDERSON and ANNE D'INNOCENZIO, with the Associated Press, helped contribute to this report.