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Mar 19, 2023Labor dispute snarls West Coast ports; White House urged to intervene
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A deepening standoff between dockworkers and port operators has snarled some of the nation's most crucial import hubs, a dispute that has drawn the attention of the Biden administration as it scrambles to contain work stoppages.
Portions of the ports at Los Angeles, Long Beach, Oakland and Seattle — gateways for container ships that bring imports from Asia — have intermittently shuttered or slowed in recent days as the International Longshore and Warehouse Union and Pacific Maritime Association, which represents port operators, try to work out a new contract.
The U.S. economy's import supply chains run through a system that involves ships, trains and trucks, and even the slightest disruption can have major spillover effects. Those ports collectively process hundreds of billions of dollars in cargo each year, accounting for products including agricultural goods, manufacturing components and consumer electronics.
The disruptions are a more subdued version of the supply chain turmoil that took hold early in the pandemic and rattled the global economy. Many of those issues have been resolved, in part, because shippers — anticipating potential labor problems — have diverted cargoes to alternative ports on the East and Gulf coasts.
The tensions at the West Coast ports mark the latest episode in which a resurgent labor movement ― emboldened by shortages of skilled workers ― has become a focal point in an economy already showing signs of strain. President Biden became personally involved in mediating a dispute among railway workers last year.
Now it is the West Coast's dockworkers, who handle the difficult and sometimes dangerous work of getting heavy shipments off ships and onto trucks, standing at a critical juncture for the U.S. economy. And many of them have been skipping shifts.
The union and port employers have mostly settled issues related to port automation and benefits, but they remain far apart on pay, according to two people briefed on the negotiations, who spoke on the condition of anonymity because of the fragility of the talks.
Acting labor secretary Julie Su has had near-daily conversations with negotiators to try to end the standoff, the people said.
The maritime association contends members of a dockworkers union have engaged in "concerted and disruptive work actions" for several days.
"Union leaders are implementing many familiar disruption tactics from their job action playbook, including refusing to dispatch workers to marine terminals, slowing operations, and making unfounded health and safety claims," according to a statement the association posted late Monday on Twitter.
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When asked for comment Tuesday, union officials referred to a statement released Friday by ILWU President Willie Adams. He pointed to "historic" profits made by port operators, which the union estimated topped $510 billion during the pandemic.
"We aren't going to settle for an economic package that doesn't recognize the heroic efforts and personal sacrifices of the ILWU workforce that lifted the shipping industry to record profits," Adams said.
More than 22,000 dockworkers at 29 ports along the West Coast have been working without a contract since July. With no deal in place, several West Coast ports have experienced intermittent closures. In other cases, company officials have confronted a dearth of skilled union workers willing to take on shifts at times when they are needed.
A representative for the Port of Oakland, which had been shuttered Friday, said it was open for business Monday at all four of its marine terminals. A representative for ILWU Local 91, which represents the dockworkers in Oakland, referred reporters to the international union Monday.
At the Port of Los Angeles, two terminals canceled appointments Friday and Monday for trucking operators to pick up imports, said Matt Schrap, chief executive of the Harbor Trucking Association.
At Long Beach on Monday, he said, two more terminals called off pickup appointments because of low volume.
A Sunday dispatch summary from the Oakland port operator showed just two individuals present, with 66 longshoreman jobs going unfilled. Most of the job openings called for skilled workers. "Jobs were ordered and dispatchers were at the hall … but no workers were in the hall to take any jobs," reads the summary. Shift summaries from Monday showed workers returning to their posts, with all outstanding jobs filled.
The ports covered by the labor agreement are some of the largest in the country. The Los Angeles port, which analysts describe as among the busiest in North America, handled about 688,000 20-foot equivalent units in April, the most recent month for which company records are available. That reflects a 22 percent decrease compared to the previous year, something that Port Director Gene Seroka attributed to a slowing global economy, warehouses full of excess inventory, and prolonged labor negotiations.
"If economic conditions improve and we get a labor deal in place, that will help improve volume the second half of the year," Seroka said in mid-May.
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But some analysts say West Coast ports and their workers are facing larger shifts in the logistics sector. The supply chain chaos wrought by the pandemic led retailers and freight brokers to search for alternative ways to move goods and route them around overwhelmed Pacific shipping gateways.
"We rewired part of the supply chain to start to leverage our ports on the East Coast," said Frank Kenney, senior director of industry solutions at supply chain integration firm Cleo.
West Coast shippers say they had hoped that supply chain improvements spurred by the pandemic would give Pacific ports long-term stability, and help them claw back lost market share. The labor dispute has knocked much of that progress off track.
"Here we are licking our wounds and still digging out, and the contract is dropped in the middle of it," Schrap said.
Business groups have complained that problems at the ports could hurt commerce across the country and threaten jobs, with two major trade associations ― the National Retail Federation and the National Association of Manufacturers ― imploring the White House to help broker a deal.
Citing an industry-backed analysis, NAM President and CEO Jay Timmons said "even a temporary shutdown at the West Coast's busiest ports will result in massive economic loss and endanger thousands of manufacturing jobs."
A Labor Department spokesman said Su, whose nomination to permanently lead the department faces steep opposition, met with the dockworkers and PMA as recently as Friday.
"Talks are progressing, and she will continue to do what is necessary to help them continue to work toward a deal," the spokesman said.
The West Coast ports are also crucial to retail supply chains, National Retail Federation Vice President David French said in a statement. The disruptions come as many retailers enter their peak shipping season for the holidays, he said.
These additional disruptions will force retailers and other important shipping partners to continue to shift cargo away from the West Coast ports until a new labor contract is established," French said in a statement.