NEW YORK (AP) 鈥� U.S. ports from Maine to Texas shut down Tuesday when the union representing about 45,000 dockworkers for the first time since 1977.
Workers began walking picket lines early Tuesday, picketing near ports all along the East Coast. Workers outside the Port of Philadelphia walked in a circle and chanted, 鈥淣o work without a fair contract.鈥�
A lengthy shutdown could raise prices on goods around the country and potentially cause shortages and price increases at big and small retailers alike as the holiday shopping season 鈥� along with a tight presidential election 鈥� approaches.
What are the issues in the dockworkers strike?
The International Longshoremen鈥檚 Association is demanding significantly higher wages and a total ban on the that are used in the loading or unloading of freight at 36 U.S. ports. Those ports handle roughly half of the nations鈥� cargo from ships.
The contract between the ILA and the United States Maritime Alliance, which represents the ports, expired Tuesday. Some progress was reported in talks late Monday, but the union went on strike anyway.
The union鈥檚 opening offer was for a , with President Harold Daggett saying it鈥檚 necessary to make up for inflation and years of small raises. ILA members make a base salary of about $81,000 per year, but some can pull in over $200,000 annually with large amounts of overtime.
Monday evening, the alliance said it had increased its offer to 50% raises over six years, and it pledged to keep limits on automation in place from the old contract. The alliance also said its offer tripled employer contributions to retirement plans and strengthened health care options.
Which ports are affected?
While any port can handle any type of goods, some ports are specialized to handle goods for a particular industry. The ports affected by the shutdown include Baltimore and Brunswick, Georgia, the top two busiest auto ports; Philadelphia, which gives priority to fruits and vegetables; and New Orleans, which handles coffee, mainly from South America and Southeast Asia, various chemicals from Mexico and North Europe, and wood products such as plywood from Asia and South America.
Other major ports affected include Boston; New York/New Jersey; Norfolk, Virginia; Wilmington, North Carolina; Charleston, South Carolina; ; Tampa, Florida; Mobile, Alabama; and Houston.
Can the government intervene?
If a strike were deemed a danger to U.S. economic health, President Joe Biden could, under the 1947 Taft-Hartley Act, seek a court order for an . This would suspend the strike.
But Biden, during an exchange with reporters on Sunday, said 鈥渘o鈥� when asked if he planned to intervene to plan a potential work stoppage impacting East Coast ports.
鈥淏ecause it鈥檚 collective bargaining, I don鈥檛 believe in Taft-Hartley,鈥� Biden said.
How will this affect consumers?
The strike could last weeks 鈥� or months. If the strike is resolved within a few weeks, consumers probably wouldn鈥檛 notice any major shortages of retail goods. But a strike that persists for more than a month would likely cause a shortage of some consumer products, although most holiday retail goods have already arrived from overseas. Shoppers could see higher prices on a vast array of goods, from fruit and vegetables to cars.
Businesses are making contingency plans
Since the caused by pandemic bottlenecks, retailers have adapted to supply chain disrupters being 鈥渢he new norm,鈥� said Rick Haase, owner of a mini-chain of Patina gift shops in and around the Twin Cities in Minnesota.
鈥淭he best approach for Patina has been to secure orders early and have the goods in our warehouse and back rooms to ensure we are in stock on key goods,鈥� Haase said.
Jay Foreman, CEO of Basic Fun, a Boca Raton, Florida-based maker of such toys as Care Bears and Lincoln Logs, has been monitoring the port situation for months and planned for it by shifting all of its container shipments to the West Coast ports, primarily Los Angeles and Long Beach, away from ports in New York and Newark, New Jersey. But he said the shift added anywhere from 10% to 20% extra costs that his company will have to absorb. He noted that Basic Fun鈥檚 prices for the next 10 months are locked in with retailers, but he could see raising prices during the second half of 2025 if the strike is prolonged.
Daniel Vasquez, who owns Dynamic Auto Movers in Miami, which specializes in importing and exporting vehicles, increased inventory, specifically for vehicles that take longer to ship, in anticipation of a strike.
He has also stopped relying on one port or shipping partner and has expanded his relationship with smaller ports and shipping companies that can bypass congested areas.
How will a strike affect holiday shopping?
Jonathan Gold, vice president of the supply chain and customs policy at the National Retail Federation, the nation鈥檚 largest retail trade group, said the strike arrives with the supply network continuing to face challenges from that have essentially shut down the use of the Red Sea and Suez Canal.
The uncertainty over the supply chain is taking place at the peak of the for retailers, which traditionally runs from July through early November. Many big retailers, anticipating a strike, started shipping their goods to U.S. distribution centers in June, and Gold said that the majority of products ordered are already in the U.S.
But retailers will have a hard time replenishing items and are incurring extra warehouse costs to store goods longer. Gold also noted that carriers are already announcing surcharges on containers to address potential disruptions.
Greg Ahearn, president and CEO of The Toy Association, the nation鈥檚 leading toy trade group, noted that a strike would happen at an extremely critical time for toy sellers and makers 鈥� up to 60% of a toy company鈥檚 annual sales come during the fourth quarter.
The holiday shipping window for the toy industry is anywhere from six to eight weeks and started in July, though some toy companies tried to ship earlier or add more toys to shipments, Ahearn said.
鈥淚t hits many ways,鈥� he said. 鈥淔rom a consumer perspective, it starts with delays in availability and then starts to surface as product shortages within toys. At retail for the toy industry, it results in potentially higher prices based on scarcity and increased costs.鈥�
___
AP Writers Tom Krisher in Detroit and Stephen Groves in Dover, Delaware, contributed to this report.
Mae Anderson And Anne D'innocenzio, The Associated Press
