With the contract between dockworkers and their employers up and down the East Coast expiring Sept. 30, fears are growing of a potential port strike that could disrupt shipping and jobs ahead of the holiday season, especially in Baltimore, which is still recovering from the Francis Scott Key Bridge collapse.
Members of the International Longshoremen’s Association from Maine through Texas are preparing to strike if they fail to reach an agreement with the U.S. Maritime Alliance, which represents employers such as shipping lines and marine terminal operators, labor leaders warned.
In Baltimore, three ILA union locals represent about 2,400 workers, most of whom load and unload ships. The numbers working on a given day typically is determined by the number of vessels at the port and other activity.
A national retail trade group warned this week that a strike would be the latest in a series of blows to the U.S. supply chain and hurt the economy just as inflation is easing.
“This is a critical time as retailers prepare for the all-important holiday season, and we need every port in the country working at full capacity,” Jonathan Gold, vice president for supply chain and customs policy at the National Retail Federation, said in a statement Monday.
Gold said many retailers have brought cargo in early and shifted to alternate ports as a precaution.
A strike would hurt Baltimore’s port recovery, said Jonathan Daniels, executive director of the Maryland Port Administration, the state agency that manages Baltimore’s six state-owned marine terminals.
Officials are closely monitoring the situation and encouraging labor and management to work toward an agreement, he said.
“Anything that may potentially engage in a work stoppage is something we are very concerned with, especially with where we currently stand on our rebound and recovery after the incident earlier this year,” Daniels said in an interview Tuesday. “This is a cascading effect that impacts all ports that have ILA labor.”
Baltimore’s port is not a party to the ILA contract, as it operates on a “landlord” model. The state has a partnership with Ports America Chesapeake to operate Seagirt Marine Terminal and others.
Facilities in Baltimore and other cities already have lost some cargo to West Coast ports, which then is moved across the country by rail. That’s happening as shippers test the operational efficiency of alternate routes before they’re forced to switch.
But Baltimore has the additional challenge of already being in recovery mode. Its shipping channel was partially shut down for more than two months after the bridge collapse. The cargo ship Dali plowed into a support pier March 26 on its way out of Baltimore, causing the span to topple and kill six roadway workers.
So far, the rebound has been progressing, Daniels said.
The number of container trucks coming through the gates of Baltimore’s port terminals has rebounded to an average of more than 3,000 per day, about 1,000 more than just a month ago, and nearly back to the pre-bridge collapse number of 3,500, Daniels said. Auto imports in July, the port’s first full month of operation after the partial shutdown, rose nearly 40% compared with last July at the port’s public terminals, while total auto cargo rose nearly 12%.
Daniels said the ILA has indicated that Baltimore’s cruise business and military-related shipments would be excluded from any potential work stoppage. An area outside the marine terminals would be made available for striking workers to demonstrate, he said.
“There’s still a significant amount of time between now and the conclusion of the termination of their existing agreement on September 30th,” Daniels said. “It’s a very fluid situation.”
In a Global Port Tracker report Monday, the retail federation and Hackett Associates predicted a busy month in September at the nation’s biggest container ports, as shippers work to get ahead of a potential strike.
ILA represented workers say they are fighting for increased wages and improved health benefits and objecting to increasing automation at marine terminals.
In a video posted last week, ILA President Harold Daggett said shippers have made “billions” of dollars in the last few years, especially during the coronavirus pandemic because the ports never shut down.
“My men went to the docks every day, up and down the coast, to keep those ships going,” Daggett said. “Mark my words, we’ll shut them down October 1st if we don’t get the kind of wages we deserve.”
Such statements lead some to believe a strike, which would be the first on a large scale for the ILA since 1977, is likely.
Dock workers feel empowered by pro-labor sentiments and contract victories by the United Auto Workers and UPS employees, represented by the International Brotherhood of Teamsters, said Ron Leibman, a partner at McCarter & English who heads the law firm’s supply chain and transportation logistics group.
If a strike occurs and drags on, it could affect availability of autos once inventory dwindles. And a stoppage could affect the holiday season at a time of year when holiday-related items account for a big chunk of consumer goods shipped to ports.
That impact may be somewhat lessened because “a lot of the fall seasonal retailers and wholesalers saw this coming and they made efforts to forward stock inventory, at least to get through the Christmas season,” Leibman said.
Consumers, however, are likely to feel the pinch of shut down marine terminals pretty quickly in the event of a large-scale strike. If that happens, ocean carrier container rates are likely to rise due to higher demand and lower capacity.
“As rates go up,” Leibman said, “so do the costs of goods to people like you and me.”
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