A major disruption is set to hit East Coast ports Tuesday as thousands of longshoremen prepare to strike, marking the first such walkout in nearly 50 years.
The International Longshoremen’s Association (ILA), representing 47,000 workers at 36 ports, is demanding raises and assurances against job loss from automation. Their current labor contract expires tonight.
If the ILA and the United States Maritime Alliance (USMX)—representing port operators and container carriers—can’t reach an agreement today, then dockworkers on the East and Gulf Coast could walk off their jobs at 12:01 a.m. ET tomorrow.
According to Oxford Economics, the affected ports handle roughly 60% of the US shipping traffic. Key ports like New York, Baltimore and Houston are expected to shut down, impacting the movement of goods such as cars, electronics and perishable items. Energy supplies and military goods may continue moving.
Economic impact and affected ports
According to a JPMorgan analysis, a strike could cost the US economy $5 billion daily.
While West Coast ports remain unaffected, diverted cargo may create further disruptions.
The last ILA strike was in 1977 that lasted 45 days.
Demands
The union wants higher pay (77% higher wages over a six-year contract), citing inflation.
Longshoremen who started working six years ago and are nearing their expiring contracts earn up to $39 per hour, an 11% increase since they started working. Over the same period, inflation is up 24%.
It asks that members receive a $5-per-hour raise each year, while management has proposed a $2.50-per-hour annual raise.
The ILA also wants protection from job losses due to automation.
The strike could inject uncertainty into the election campaign, with the shutdown coinciding with the vice-presidential debate. The Biden administration faces pressure to intervene, though it has yet to show signs of stepping in.