US dockworkers strike; automation issue a sticking point

Some 45,000 dockworkers on the US East Coast and Gulf Coast began their first major strike in nearly 50 years on Tuesday, halting the flow of about half the country's ocean shipping as they voiced concerns over pay and the effect of automation on union jobs.

President Joe Biden's administration has indicated it will not use federal powers to end the strike, and pushed dockworker employers to increase their contract offer.

The International Longshoremen's Association (ILA) union had been negotiating with the United States Maritime Alliance (USMX) employer group for a six-year contract ahead of a midnight Monday deadline.

The ILA said in a statement it shut down all ports from Maine to Texas at 12:01 am ET after rejecting USMX's final proposal, saying that the offer fell "far short of the demands of its members to ratify a new contract".

ILA leader Harold Daggett has said employers such as container ship operator Maersk and its APM Terminals North America have not offered appropriate pay increases or agreed to demands to stop port automation projects.

"We are prepared to fight as long as necessary, to stay out on strike for whatever period of time it takes, to get the wages and protections against automation our ILA members deserve," Daggett said.

"Everything that comes in this country comes from the containers off these ships that my men work. And I want the world to know it," he said. "Don't come after us saying we're greedy. Go after those greedy bastards that own these companies in Europe."

In a statement, USMX said: "Our current offer of a nearly 50 percent wage increase exceeds every other recent union settlement, while addressing inflation and recognizing the ILA's hard work to keep the global economy running."

Daggett said the union is seeking more, including a $5 per hour raise for each year of the new six-year contract.

USMX offered 50 percent raises over the life of the contract. The union's leadership had briefly suggested a move to 61.5 percent, but since signaled that it was staying with its initial demand for a 77 percent increase over six years.

The walkout could cost the American economy about $5 billion a day, according to JP Morgan analysts.

The National Retail Federation called on the Biden administration to use its authority to end the strike.

White House officials have said the Democratic president will not do so.

"Shippers have made record profits since the pandemic, and in some case, have seen profits grow in excess of 800 percent," White House press secretary Karine Jean-Pierre said.

The presidential election is just over a month away, and union votes are at stake.

Retailers that account for about half of all container shipping volume have been using alternative plans as the winter holiday season approaches.

Many rushed to bring in Halloween and Christmas merchandise — much of which comes from China — to avoid any disruptions, incurring extra costs to ship and store goods.

"We have become hypersensitive to anything that will affect global trade and importation of our products," Jay Foreman, the CEO of toy manufacturer Basic Fun, told the New York Post. "We knew this day was coming."

Foreman, whose company ships its goods from a warehouse in China, said that he had his containers redirected to the West Coast six months ago.

"Typically, 35 percent of all our shipments come to the East Coast," Foreman told the Post. "We diverted everything whether it cost us a bit more in cash and the use of capital and time."

Lars Jensen, CEO of shipping consultancy Vespucci Maritime, told Reuters, "At the end of the day, the only one who's going to end up paying the bill for this is the US consumer, simple as that, because import costs are going to rise, and those costs are going to be passed on to all the imported products."

The dockworkers' bargaining stand is likely bolstered by the nation's supply chain of goods coming under pressure in the aftermath of the devastating Hurricane Helene in the US Southeast.

On Tuesday, workers outside the Port of Philadelphia chanted, "No work without a fair contract." The union posted a message on the side of a truck that said: "Automation Hurts Families: ILA Stands For Job Protection".

Boise Butler, president of the union local, said that workers want a contract that doesn't allow for job automation.

In New Orleans, Henry Glover Jr, a fourth-generation dockworker who is president of the union local, told The Associated Press, "Automation could be good, but they're using it to kill jobs."

Agencies contributed to this story.

hengweili@chinadailyusa.com