Thousands of port workers at East Coast and Gulf ports went on strike on Oct. 1, a move that could have far-reaching impacts on the supply chain. But its effect on the construction sector remains to be seen.
The International Longshoremen’s Association (ILA) began its first coast-wide strike in nearly 50 years, saying the last offer from the United States Maritime Alliance (USMX), which represents the ports, before it expired its latest contract on September 30 “fell well short of what ILA rank-and-file members are demanding in wages and protections against automation.”
Strike stops work at Boston docks; New York/New Jersey; Philadelphia; Baltimore; Norfolk, Va., Wilmington, N.C.; Savannah, Ga.; Tampa Bay, Florida; Mobile, Alabama, New Orleans and Houston.
“USMX started this strike when they decided to hold firm the foreign-owned ocean carriers making billions of dollars in profits at US ports, but not compensating the American ILA maritime workers who do the work they brings its wealth,” said ILA President Harold Daggett. he said in a statement.
The union said it is seeking a $5-an-hour raise for each year of a six-year deal, “tight language that there will be no automation or semi-automation” and container gift money for ILA.
USMX says it made an offer that would increase wages by nearly 50%, triple employer contributions to employee retirement plans and strengthen health care options. He also said the offer retains the current language about the limits of automation.
“USMX increased our offer and has also requested an extension of the current master contract, now that both parties have abandoned their previous positions,” USMX said in a statement. “We are hopeful that this will allow us to fully resume collective bargaining on other outstanding issues in an effort to reach an agreement.”
Construction impacts
Ken Simonson, chief economist for the Associated General Contractors of America, says he hasn’t yet heard of any impact on construction inflows or equipment. But if the strike lasts, expect it to affect obscure or specific components from overseas.
“I remember the first construction supply chain impact of Covid that I heard about was Italy’s elevators and parts, which were hit hard in February 2020, before anyone died in the U.S.,” he says by e-mail.
However, the strike could further affect construction if supply chains are also affected by other issues, such as the ongoing impacts of Hurricane Helene and other potential storms, low water levels in the Mississippi River that affect barge movement and shipping disruptions related to the Middle East conflict, Simonson. adds
Ending the Strike
Associated Builders and Contractors joined the U.S. Chamber of Commerce and other groups in calling on President Joe Biden to invoke the Taft-Hartley Act to stop the strike while negotiations continue. Under the law, Biden could impose an 80-day waiting period before workers could strike.
“If the Biden-Harris administration is serious about rebuilding America and maximizing hundreds of billions of dollars in taxpayer investment in infrastructure, clean energy and manufacturing, the construction industry simply cannot afford any more disruption of the supply chain and additional cost increases in critical materials,” said Kristen Swearingen, ABC’s vice president of legislative and policy affairs, in a statement.
However, Biden said two days before the strike began that he would not intervene.
Supply chain in operation
The strike does not affect West Coast ports. And the ILA said its members will continue to handle military cargo and work on cruise ships.
Mario Cordero, general manager of the Port of Long Beach in California, said in a statement that the port has been in close contact with ocean carriers, terminal operators, railroads and others to do what it can to keep the domestic supply chain operational.
“The port is handling as much cargo as we did in 2021 and 2022, but without any of the pandemic-era delays, delays or congestion that arose due to issues outside the port,” he said.
