Dockworkers union halts strike until Jan. 15 as bargaining continues
The strike that shut down operations of East and Gulf coast ports and threatened to cause significant economic damage to the U.S. economy has halted — at least for now.
The union representing 45,000 U.S. dockworkers said it has agreed to suspend their strike that began on Tuesday until early next year.
“Longshoremen’s Association and the United States Maritime Alliance, Ltd. have reached a tentative agreement on wages and have agreed to extend the Master Contract until January 15, 2025 to return to the bargaining table to negotiate all other outstanding issues,” according to a joint statement issued Thursday night. “Effective immediately, all current job actions will cease and all work covered by the Master Contract will resume.”
The union representing thousands of dockworkers from Maine to Texas launched a strike over wages and the use of automation, shutting down major seaports.
The agreement will allow the union and the U.S. Maritime Alliance, which represents the shippers and ports, time to negotiate a new six-year contract.
A strike would cause billions of dollars in economic damage and force shippers to divert more products to the West Coast, raising costs for retailers and ultimately consumers.
The union went on strike this week after its contract expired and is seeking protections against job losses caused by automation and higher pay.
Leaders of the longshoremen union were demanding an annual increase of $5 an hour over six years, which would amount to a 77% gain from the current base rate of $39 at the top scale.
On Monday, the employers alliance said it had offered a nearly 50% increase, but that was rejected by the union.
The walkout raised the risk of shortages of goods on store shelves if it lasted more than a few weeks. But most retailers had stocked up or shipped items early in anticipation of the work stoppage.
The move should give some relief to the Biden administration as it was reluctant to intervene but also didn’t want to weather a lengthy strike that risked disruption to the economy and supply chains, especially during the holiday shipping season.
Moreover, if the strike had extended into next week, it could have lowered the monthly employment numbers for October. The October jobs report is due out on the first Friday of November, just a few days before election day.
“One gets the sense that if the labor action continued, pressure on the administration to invoke its Taft-Hartley [Act] powers was increasing at a geometric rate given the optics and noise around the strike,” said Joseph Brusuelas, chief economist for RSM US, a tax and consulting firm.
The strike did not affect workers on the West Coast who are represented by a different union. Officials at the post of Los Angeles and Long Beach said they were prepared to handle the extra volume of shipments as more cargo was rerouted from the East due to the work stoppage. However, a protracted strike could have created potential bottleneck problems for the local ports.
Last year, the International Longshore & Warehouse Union and the Pacific Maritime Assn. agreed to a new six-year contract. ILWU workers last year earned a basic rate of $52.85, according to the Pacific Maritime Assn.’s annual report.
The Associated Press contributed to this report.
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