There have been growing talks of strikes in East Coast ports, with labor contracts expiring later this year. Near the end of September, agreements between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) expire. The ILA is an alliance of nearly 70,000 port workers, and the USMX represents 36 coastal port employers. Out of the dozens of ports, USMX workers are at the three busiest East and Gulf Coast ports. The last East Coast port strikes happened in 1977, which led to a labor action that lasted for two months. With recent talks of potential strikes rising, what can this mean for international shipping, and how can you prepare?
Why Have Talks Of Strikes In East Coast Ports Increased?
Since the strike in 1977, the USMX and ILA have negotiated ten contracts lasting several years. The parties signed the last six-year contract in September of 2018. Talks of strikes later this year have increased due to issues with current agreements. ILA workers noted that they are pushing for wage increases of nearly 30% or higher, plus benefits. Another issue has been the growing use of automation at ports, threatening the jobs of ILA workers. The ILA also has a $300 million lawsuit against USMX and two carriers over a hybrid labor model. The argument is that the model at the Port of Charleston violates the existing agreement.
On November 7th, 2023, the ILA president Harold Daggett told ILA members to prepare for a strike in October 2024. In 2023, Pacific Maritime Association (PMA) West Coast port workers reached a long-term contract agreement after 11 months of uncertainty. This was during the post-Covid import boom, and traffic coming into the U.S. shifted to East and Gulf coast ports. Unlike the expired PMA contract, the current ILA situation may result in protests once the contract ends later this year. Associations like the National Retail Federation (NRF) have expressed their desire to facilitate talks between the ILA and USMX.
What Does This Mean For Shipping?
Along with the strike’s impact on the ILA and USMX, international shipping will feel the ramifications. Various situations, like a conflict in Gaza and a drought in the Panama Canal, have already affected global cargo movement. If workers are on strike, it can lead to cargo congestion, which causes shipment delays. It is crucial to note that East and Gulf Coast ports have more diverse import locations than West Coast ports. While West Coast ports mainly get cargo from Asia, East Coast ports get cargo from Europe, Asia, and South America. Protests may also cause importers from different countries to switch to West Coast ports.
While moving goods internationally can sometimes be complex, there are ways to ensure the success of a shipment. Along with staying up-to-date with current news, importers and exporters should act early to prevent delays or extra costs. A standard method that shippers use is using the assistance of a third-party logistics (3PL) provider. In addition to shipping, 3PLs have various services to streamline your supply chain while educating you through the process. Reach A1 Worldwide Logistics at 305-821-8995 or info@a1wwl.com for a quote to begin your shipping journey. We help your global supply chain by providing transparency and solutions for you to reach your goals.
