Trade groups representing U.S. shippers and retailers are growing nervous about potential disruptions at seaports across the country this summer as dock workers prepare to renegotiate their employment contract with port operators, according to a statement from the Retail Industry Leaders Association (RILA).
Time is already running out for a possible setback in the container trade as the International Longshore and Warehouse Union (ILWU) prepares to enter contract negotiations with the Pacific Maritime Association (PMA) before the contract expires current June 30, just 16 weeks away. .
Both sides are still reeling from the protracted legal battle that followed the 2014 contract renewal debate, when dockers worked for months without a contract before resorting to work slowdowns that hampered workers’ productivity. maritime terminals for weeks.
If this story repeats itself, further problems in container import and export flows would come at a time when the U.S. and global economies are still struggling to recover from pandemic-triggered supply chain safeguards. of covid, resulting in congested ports and dozens of container ships lying at anchor off the west and east coasts of the United States.
In order to avoid escalating this scenario, RILA today sent a letter to the White House urging the Biden administration to engage “early and persistently” in the impending contract negotiations. “The pandemic-related disruptions to the nation’s supply chain have been costly and impractical,” RILA President Brian Dodge said in a statement. “Letting a slowdown or work stoppage affect operations would amount to a self-inflicted injury, worsening congestion and leading to even higher costs on everyday products for consumers.”
A repeat of the port crisis would come at a time when global economic anxiety is already on the rise due to Russia’s invasion of Ukraine and growing US supply chain challenges under strain, such as price inflation and labor shortages. “Previous port labor disputes have cost the U.S. economy more than $1 billion to $2 billion a day,” said Steve Lamar, president and CEO of the American Apparel & Footwear Association (AAFA). in the RILA letter. “To say that the stakes are even higher today is an extreme understatement, as even a brief slowdown or halt will disrupt already fragile supply chains and add to inflationary pressure.”
The RILA letter follows a similar notice from the National Retail Federation (NRF), which on February 24 encouraged the ILWU and PMA to begin contract negotiations well ahead of the contract expiry date.
“NRF members continue to adapt to ongoing supply chain disruptions,” NRF President and CEO Matthew Shay said in a letter to ILWU and PMA leaders. . “Any kind of additional disruptions at ports would add costly delays to our members’ supply chains and would likely exacerbate inflation problems and further threaten economic recovery. Many members are already looking to put in place mitigation strategies to deal with additional disruptions related to contract negotiations.
the #WestCoastPorts account for more than 44% of national container port traffic. While negotiations for the PMA and ILWU contracts have yet to officially begin, uncertainty is already disrupting cargo strategies and operations on the ground. 49 groups urge WH to engage: https://t.co/TxztAGTI0a
— RILA (@RILAtweets) March 1, 2022