Following months of warnings, the International Longshore Association (ILA) today launched its first strike since 1977, shutting down operations at all East and Gulf coast ports which account for more than half of US maritime trade. The powerful union’s 45,000 members began walking out at midnight at 36 ports from Texas to Maine.
“The ILA is fighting for respect, appreciation and fairness in a world in which corporations are dead set on replacing hard-working people with automation,” the union affirmed in a flyer distributed to its picketers. “Robots do not pay taxes and they do not spend money in their communities.”
The ILA reportedly stressed it would not resume begin negotiations until the employers agreed to a 77% increase in wages for the new six-year contract. The master contract would also have to address issues regarding automation, benefits, and work rules.
Represented by the U.S. Maritime Alliance (USMX), the employers reportedly raised their previous offer of 40% to 50%, but this did not prove enough to stave off a strike.
ILA President Harold Daggett stated: “USMX brought on this strike when they decided to hold firm to foreign owned Ocean Carriers earning billion-dollar profits at United States ports, but not compensate the American ILA longshore workers who perform the labor that brings them their wealth.”
While urging the parties to find a compromise solution, the Biden administration has not yet indicated it may intervene – a move sought by many industry groups.
According to a Michigan-based research firm, the direct costs for a one-week strike could attain US$2 billion.
Just a few hours after the work stoppage began, ILA President Harold Daggett joined a big group of longshoremen picketing at the Port of New York/New Jersey (per photo) and pledged he would secure a “great contract” within a few weeks.
“Whether it’s one week, two — I’m hoping by three it’s over, I’m hoping — you are making history here,” Mr. Daggett said, adding: “We are going to walk away with a great contract.”
Some ocean carriers have already started to implement contingency plans to discharge cargo at alternate ports. For example, Hapag-Lloyd announced Monday that vessels in its Caribbean Express Service that would have called the Port of Virginia this week now plan to call Canada’s Port of Saint John.
Speaking to CNBC’s Street Signs Europe today, Xenata chief analyst Peter Sand said he expects the US government will intervene if the strike extends on to next week. “They [government] can’t let the strike can’t go on forever.”
“We see the dominos fall in multiple stages now. At first, of course, the immediate effect is on the U.S. East and Gulf coast, right?” he said.
There will then be a knock-on effect for vessels currently queuing outside the ports, Mr. Sand added, meaning their next voyages to the U.S. with new goods will be delayed.
“We will see disruption with some ships being late out of Europe and the Mediterranean towards the end of October and early November,” Mr. Sand said went on.
The ships will be delayed leaving Asia toward the end of December and early January — “and that’s basically when the next normal mini-peak in container shipping happens in the lead-up to Chinese New Year.”
Meanwhile, according to a Linerlytica report: “On the eve of the port strike on 29 September 2024, there were 54 container ships of 371,000 TEUs docked at ports on the East Coast with a further 90 ships of 505,000 TEUs that are scheduled to call at the East Coast in the next seven days with the build-up of ships expected to cause severe port congestion over the coming weeks.
(ILA photo of union leader Harold Daggett among picketers at Port of NY/NJ)
