Disruptions in port operations due to labor issues have occurred this year, seeding doubt that a labor agreement is on the horizon as the industry approaches its peak holiday shipping season.
Long Beach, California – With cargo import values now projected to return to pre-pandemic levels, The International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) are locked into a contentious labor agreement battle that has stalled with no end in sight after more than a year of negotiations.
The PMA, which represents employers and includes ocean carriers in its membership, has so far declined to afford large increases to dockworker pay due to economic uncertainty spearheaded by reduced consumer spending and tightened fiscal policies. Cargo volumes for 2023 have so far reflected pre-pandemic levels, reducing the PMA’s appetite to lock in long-term higher dockworker pay, whose full-time members make an average annual salary of $200,000 or more depending on their job title.
While thankfully the PMA and ILWU have avoided lockouts or strikes so far, disruptions in port operations due to labor issues have occurred this year, seeding doubt that a labor agreement is on the horizon as the industry approaches its peak holiday shipping season.
On Friday, June 2, dockworkers refused to show up to work, shutting down operations at various terminals at the Ports of Los Angeles and Long Beach. This was the second disruption of operations due to labor issues this year, with the first occurring in late March that shut down night shift operations on March 30 and day shift operations on March 31.
The importance of West Coast ports, especially the Ports of Los Angeles and Long Beach, are critical to the nation’s supply chains and economic health due to the number of consumer goods that are imported through there by retailers and other businesses. The cost of shipping goods from the manufacturing hubs of Asia to the Gulf and East Coast ports is much higher, which is ultimately passed down to the consumer via increased prices.
It is in the interest of both the PMA and ILWU to reach a long-term labor agreement that benefits both parties, not only for the economic health of the nation but to also maintain the West Coast’s critical competitive advantage over other ports of entry due to its proximity to Asia.
