<img alt="" src="https://secure.perk0mean.com/182585.png" style="display:none;">
Request a Quote

red-accent

 

Is there an impending East Coast port strike in 2024?

June 26, 2024 Kevin Baxter

Port of Savannah

Contentious labor battles are threatening multiple North American supply chains. No, it's not late 2022 with an almost-happened U.S. rail strike. Nor is it Summer 2023 when a West Coast port strike was close to reality. Instead, we have labor unrest on the rest of the U.S. coastline, with the union representing dockworkers at East Coast and Gulf Coast ports threatening to strike.

Will there be an East Coast port strike in 2024?

The threat of an East Coast port strike in 2024 has been well documented for some time, as the September 30 date of the current contract expiration has long been circled on the calendar. The parties involved are:

The International Longshoreman's Association (ILA) - The ILA, led by President Harold Daggett, represents an estimated 45,000 dockworkers at East Coast and Gulf Coast under the agreement in question

The U.S. Maritime Alliance (USMX) - The USMX, led by Chairman and CEO David F. Adam, represents container carriers, direct employers and port associations that serve the east and gulf coasts

Thirty-six coastal ports are affected by the contract - as far north as Maine and as far south as Texas. Included among them are the Port of New York and New Jersey, the Port of Savannah and the Port of Houston, as well as three more of the top 10 busiest ports in the country. 

What is the ILA looking for?

The ILA's key focus is an increase in pay - some reports have their ask in excess of 30% plus bonuses to put workers on par with last year's agreement between the ILWU and PLA on the west coast. In a recent Facebook post discussing reported profits of USMX member companies, Daggett said the employers are in for a "rude awakening," saying "This is our time, and the ILA will demand our ILA longshore workers get big boosts in their wages."

Other words thrown around over the past several months have included "generous" and "landmark" to describe the ILA's desired pay structure. The association also notes inflation has also cut into the real-world pay in the current agreement.

The use - and threat of - automation is another clear union priority beyond pay. The ILA has repeatedly voiced concerns about USMX members' use of automation to replace workers. In fact, the union called off a recent negotiating session when it said it discovered the use of an auto gate system at the Port of Mobile to process trucks - something the ILA says violates its current contract (though Maersk denies it's a violation).

In the aforementioned Facebook post, the union also accused member companies of using new technology to automate clerical tasks that "effectively reduce or eliminate jobs held by ILA clerks." Daggett is also quoted as saying companies are trying to "eliminate ILA jobs with the introduction of automation while raking in billions of dollars."

On the flip side, the USMX is keeping any particular priorities close to the vest. Their latest statement simply indicated local contract negotiations took place over a two week period, with some issues requiring further discussion. The organization said it "looks forward to re-engaging" to move negotiations forward "for the betterment of the USMX membership and the ILA rank-and-file.

How is cargo affected by labor unrest?

The simple threat of a strike can be enough to affect supply chains. While labor unrest persisted on the West Coast from 2022 to 2023, there were clear volume shifts as shippers diverted some cargo to East Coast ports. The longer negotiations are stalled on the East Coast, a reverse of that behavior becomes likely.

So far, the numbers show slight gains along the Pacific side, but nothing substantial as of yet. Still, the logistics industry watches with the already significant impacts of Red Sea diversions affecting international shipping. On a recent podcast, Dr. Jason Miller of Michigan State University noted that a prolonged East Coast port strike could cause "some froth in the market."

How likely is a port strike in 2024?

The rhetoric around an East Coast port strike threat has been strong for months, and not much has changed. After the negotiation pause, Daggett deemed the threat on October 1 "more likely." That language follows on his statement at a meeting last November that members "should prepare for the possibility of a coastwide strike."

Stakeholders have expressed concern as well, with groups including the National Retail Federation, National Association of Manufacturers and U.S. Chamber of Commerce among 150-plus to sign onto a letter to President Joe Biden. The letter asks the administration to intervene to restart negotiations and ensure no disruptions at the ports.

One sign that the two sides (or at least representatives from the two sides) can negotiate an agreement emerged just today. SC Ports and the ILA jointly announced the reopening of the Port of Charleston's Leatherman Terminal following a lengthy disagreement regarding its employment model. The two sides said they'd "mutually developed and agreed to the framework for an operating agreement," and that they're "ready to welcome USMX partners" at the terminal for years to come.

The clock is obviously ticking, as the current contract signed in 2018 runs out about three months from now. It's worth noting there has been no strike at these ports since 1977. But it is also worth noting that while West Coast dockworkers actually continued work nearly a year after their prior contract expired without striking - the ILA has focused on the September 30 contract expiration date as a firm deadline.

Whether your goods traverse the ports or stay on dry land, we can help. Request a quote and we'll follow up with intermodal and truckload options that fit your shipping needs. For more information about InTek, or logistics and supply chain issues in general, check out our Freight Guides.

Talk To Us We're Here to Help

Share This: