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Ten major US ports could face closures next week, as a labor dispute over wage and concerns over introducing more automation escalates between 45,000 dockworkers and industry leaders.
The International Longshoremen’s Association (ILA) is preparing for a possible strike if no progress is made in negotiations with the United States Maritime Alliance (USMX), a group representing 40 shipping and terminal companies.
The union accuses the USMX of making inadequate offers on wages and failing to address concerns over automation. If a deal is not reached by Tuesday, 36 ports along the US east and Gulf coasts could be affected by the first port worker strike since 1977.
Effects of US dock strike
A prolonged strike would cause huge disruption to the US economy and elsewhere and could threaten jobs in a variety of sectors, specifically manufacturing and retail which may struggle with importing and exporting goods that usually arrive by sea.
Analysts at JP Morgan predict that such a stoppage could cost the US economy $5billion a day, while Sea-Intelligence estimates clearing the backlog from a one-day strike could take up to six days. Talks between the two sides have stalled since June, with the ILA alleging that USMX violated the current contract by implementing automation in some ports, including Mobile, Alabama, without union agreement.
The ILA demands higher wages, better healthcare, and restrictions on automation, arguing that technology is threatening jobs. They have criticized the shipping industry for reaping large profits while cutting labor costs. ILA president Harold J. Daggett recently stated that USMX’s offers have been “insulting,” and that union members would not accept lower pay, especially given the significant profits of shipping companies.
Daggett highlighted the efforts of port workers during the pandemic, accusing shipping companies of profiting while many workers faced health risks. He warned that a coast-wide strike could shut down operations across the eastern and southern US, placing blame on the USMX for the impasse.
Union officials also pointed out that their wage demands, which include a $5-per-hour raise annually over six years, represent less than a 10% yearly increase.
Last year, dockworkers on the US west coast reached a six-year deal that included a 32% wage increase over the life of the contract, covering 22,000 workers. The USMX said it is open to federal mediation but said that attempts to schedule further negotiations with the ILA have been unsuccessful.
