Port strike on US East coast just weeks away

The potential strike by the International Longshoremen’s Association (ILA) is poised to cause significant disruption to US supply chains, particularly across East and Gulf Coast ports.

With negotiations between the ILA and the United States Maritime Alliance (USMX) deadlocked, there is a growing concern that a work stoppage could begin as soon as 1st October 2024.

At the heart of the conflict is a wage dispute, with the ILA rejecting USMX’s latest contract offer and the union demanding a substantial 78% rise over six years. Another key issue is automation, with the union seeking stronger measures to block the introduction of automated systems at marine terminals, which it sees as a threat to job security.

These sticking points have stalled negotiations, and with the current contract set to expire on 30th September, the risk of a coast wide strike after the 1st October looms large.

The timing of the potential strike could not be worse for supply chains, as it coincides with peak shipping season and the busy holiday period. US East and Gulf Coast ports handle over half of all inbound containers to the country, and a strike could cause severe congestion, leading to cascading delays throughout the entire logistics network.

The impact would be felt across industries reliant on timely deliveries, from retail to manufacturing, and each day of a port shutdown could result in five days of recovery time, compounding the already fragile state of global shipping.

The political implications of the strike are also significant. While the Biden administration played a key role in preventing a rail strike in 2022, the ILA has so far resisted government intervention, complicating efforts to avoid a shutdown.

With the 2024 presidential election on the horizon, any federal involvement would need to carefully balance labor interests with the national economic fallout. One possible option is invoking the Taft-Hartley Act, which would allow the government to temporarily halt the strike while negotiations continue, though such measures are politically sensitive.

We have contingency plans in place to avoid ports likely to be most affected by strikes, along with alternative routes and entry points.

To discuss the issues raised here and how PSP Worldwide could protect your supply chain, please EMAIL our managing director, Colin Redman.