US East Coast Dockworkers Strike, Halting Half of Nation’s Shipping

By Doyinsola Oladipo and David Shepardson

NEW YORK (Reuters) – Dockworkers on the U.S. East Coast and Gulf Coast began a strike on Tuesday, their first large-scale stoppage in nearly 50 years, halting the flow of about half of the shipping maritime of the country after negotiations for a new employment contract. collapsed on wages.

The strike is blocking everything from food to auto shipments at dozens of ports from Maine to Texas in a disruption that analysts say will cost the economy billions of dollars a day, threaten jobs and will fuel inflation.

The International Longshore Association (ILA) union, which represents 45,000 port workers, was negotiating a new six-year contract with the United States Maritime Alliance (USMX) employer group before the deadline of September 30 at midnight.

The ILA said in a statement Tuesday that it closed all ports from Maine to Texas at 12:01 a.m. ET (0401 GMT) and rejected the USMX’s final proposal made Monday, adding that the offer was “far from respond to the requests of its members. to ratify a new contract.

Fiery ILA leader Harold Daggett said employers like container ship operator Maersk and its APM Terminals North America had failed to offer appropriate pay increases or accept demands to stop the port automation projects. The USMX said in a statement Monday that it had proposed raising wages by nearly 50 percent, up from an earlier proposal.

“We are prepared to fight as long as it takes, to stay on strike as long as it takes, to get the wages and protections against automation that our ILA members deserve,” Daggett said Tuesday.

“The USMX now owns this strike. They must now respond to our demands for this strike to end.”

The USMX did not immediately respond to requests for comment.

The strike, the ILA’s first since 1977, worries businesses across the economy that rely on shipping to export their goods or secure crucial imports. The strike affects 36 ports that handle a range of containerized goods from bananas to clothing to cars.

There are nearly 100,000 containers in New York area ports alone waiting to be unloaded, now frozen by the strike, and 35 container ships will head to New York in the coming week, a said Rick Cotton, executive director of the New York Port Authority. and New Jersey.

The union “has the entire country in control,” said Steve Hughes, CEO of HCS International, which specializes in automotive supply and transportation. “I’m really afraid it will be ugly.”

The conflict also puts pro-union U.S. President Joe Biden in a virtually no-win position as Vice President Kamala Harris leads a tight election race against former Republican President Donald Trump.

White House Chief of Staff Jeff Zients and top economic adviser Lael Brainard urged USMX board members at a meeting Monday to resolve the dispute fairly and quickly, a White House official said. But the Biden administration has repeatedly ruled out using federal powers to break a strike in the event of an impasse.

U.S. Chamber of Commerce President Suzanne Clark urged Biden on Monday to reconsider, saying it “would be unconscionable to allow a contract dispute to inflict such a shock on our economy.”

The White House had no immediate comment Tuesday, but officials told Reuters on condition of anonymity that they were hoping for a short strike. They highlighted the positive sign that the two sides had resumed negotiations on Sunday evening and had narrowed their differences over the past 24 hours.

BACKUP PLANS

Retailers accounting for about half of all container shipping volume have been busy implementing contingency plans as their all-important winter holiday sales season approaches.

Many big players rushed early to deliver Halloween and Christmas goods to avoid any strike-related disruption, thereby incurring additional costs to ship and store those goods.

Retail giant Walmart, the largest container shipper in the United States and the operator of the Costco warehouse club, say they are doing everything they can to mitigate any impact.

New York State Governor Kathy Hochul said the state does not expect any immediate impacts on suppliers of food or essential goods, but said impacts could widen depending on of the duration of the crisis.

“It is critical that the USMX and ILA soon reach a fair agreement that respects workers and ensures a flow of commerce through our ports,” she said Tuesday.

(Reporting by Doyinsola Oladipo; additional reporting by Gursimran Kaur, Nilutpal Timsina, Shivani Tanna and Shubham Kalia in Bengaluru and David Shepardson in Washington; writing by Richard Valdmanis; editing by Richard Chang and Sonali Paul)