Tens of thousands of U.S. dockworkers are set to walk off the job early Tuesday morning, clogging dozens of ports along the East and Gulf coasts and potentially raising consumer prices ahead of the holiday season, according to an ABC News report.
New York Gov. Kathy Hochul said in a statement Tuesday, "Moments ago, the first large-scale eastern dockworker strike in 47 years began at ports from Maine to Texas, including at the Port Authority of New York and New Jersey,"
"In preparation for this moment, New York has been working around the clock to ensure that our grocery stores and medical facilities have the essential products they need," Hochul added.
Prior to the strike, Sean O'Brien, the president of the Teamsters labor union, issued a letter expressing solidarity with the International Longshoreman's Association., "The International Brotherhood of Teamsters, including our members in the freight industry, stand in full solidarity with the International Longshoremen’s Association as they fight for a fair and just contract with the ocean carriers represented by USMX."
“Don’t forget - Teamsters do not cross picket lines. The Teamsters Union is 100 percent committed to standing with our Longshoremen brothers and sisters until they win the contract they deserve,” O'Brien said.
According to a report shared with ABC News by JPMorgan senior equity analyst Brian Ossenbeck, the ports handle over 50% of the country's container imports, aiding in the transportation of a wide range of goods, from toys and fresh fruit to nuclear reactors.
Experts say a prolonged work stoppage of several weeks or months could rekindle inflation for some goods and trigger layoffs at manufacturers as raw materials dry up.
Jason Miller, a supply-chain management professor at Michigan State University who closely monitors imports, informed ABC News, "A strike would be very, very disruptive."
"You can't take all this freight and either send it to other ports or put it on airplanes," Miller added. "There is no plan B."
The International Longshoreman's Association (ILA), the union representing East Coast and Gulf Coast dockworkers, is seeking higher wages and a ban on the use of some automated equipment.
"ILA longshore workers deserve to be compensated for the important work they do keeping American commerce moving and growing," the ILA told ABC News in a statement on Monday.
"Meanwhile, ILA dedicated longshore workers continue to be crippled by inflation due to USMX's unfair wage packages."
The U.S. Maritime Alliance, or USMX, an organization negotiating on behalf of the dockworkers' employers, did not respond to an ABC News request for comment.
President Joe Biden has the authority to stop a strike under the 1947 Taft-Hartley Act.
The U.S. Chamber of Commerce sent a letter to Biden on Monday, asking the White House to get involved, even though the White House has previously stated that it will not intervene. The White House told ABC News in a statement that it has been in touch with both the union and management in recent days.
"This weekend, senior officials have been in touch with USMX representatives urging them to come to a fair agreement fairly and quickly – one that reflects the success of the companies. Senior officials have also been in touch with the ILA to deliver the same message," White House spokesperson Robyn Patterson said.
A cargo ship sits in a New Jersey port along New York Harbor on April 19, 2023.
What could this mean for consumers?
A prolonged strike at East Coast and Gulf Coast ports could lead to moderate price increases for a variety of goods, according to experts interviewed by ABC News. The price pressure would stem from a shortage of products due to the blockage in the supply chain, resulting in an imbalance of supply and demand.
Adam Kamins, a senior director of economic research at Moody's Analytics, told ABC News,
Food products are especially vulnerable to an uptick in prices, since food could spoil if suppliers sent the products ahead of time to minimize the strike impact, as they have done for some other goods.
Additionally, a significant share of the nation's imported auto parts pass through the ports impacted by a potential strike, which could cause an increase in vehicle prices if the strike persists.
Price increases have slowed dramatically from a peak in 2022, but inflation remains higher than the Federal Reserve's target rate of 2%. A strike could prevent further progress, according to Kamins.
"We're not talking about prices skyrocketing by any means, but I think it halts the momentum we've had over the last year or so getting inflation back in the bottle," he said.
In 2002, a strike among workers at West Coast ports lasted 11 days before then-President George W. Bush invoked the Taft-Hartley Act and ended the standoff. However, the last time East Coast and Gulf Coast workers went on strike was in 1977, and the work stoppage lasted seven weeks.
Tuesday's potential work stoppage on Tuesday follows high-profile strikes carried out last year by auto workers, as well as Hollywood writers and actors.
Most recently, 33,000 Boeing workers walked off the job in early September, demanding better pay and retirement benefits, according to ABC News.
"Trade unions all over the country have been going out on strike," Sriram Narayanan, a professor of supply chain management at Michigan State University, told ABC News. "We're seeing that happen now at the ports."
Source ABC News
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