On Thursday, October 3rd, US President Biden said that he believes progress is being made in the labor contract disputes at East Coast and Gulf of Mexico ports, as the United States is facing its largest dockworkers’ strike in nearly half a century, now entering its third day.
Biden, before boarding Air Force One today, told reporters, “I think we’re making progress in that regard.” However, he did not provide details, only stating, “We will soon know.”
There have been no negotiations scheduled between the International Longshoremen’s Association (ILA) and employers, but under pressure from the White House to increase wages for reaching an agreement, port owners stated on Wednesday (October 2) that they are open to new discussions.
The massive strike, the largest in nearly half a century, has disrupted container shipments from Maine to Texas along the US East Coast, threatening shortages of goods ranging from bananas to auto parts and causing ships to be anchored outside major ports.
According to data from supply chain risk analysis company Everstream Analytics, as of Wednesday, at least 45 container ships were unable to unload at ports affected by the strike along the East Coast and Gulf of Mexico, compared to only 3 before the strike began on Sunday, September 29.
Following the breakdown of six-year contract negotiations with the United States Maritime Alliance (USMX) employers group, the ILA launched the strike of 45,000 dockworkers from Maine to Texas on Tuesday, October 1, marking the largest work stoppage since 1977.
The ILA is demanding significant wage increases and a halt to port automation projects, citing concerns that it would eliminate job opportunities. While the USMX proposed a 50% wage increase, the ILA argued that it is insufficient to address their concerns.
Transportation Secretary Pete Buttigieg reportedly joined dialogues with unions and the Maritime Alliance, indicating that there appears to be minimal disagreement on wage issues. Recent statements from both sides suggest that the wage increase requested by the union is less than $5 per hour higher than what the management proposed.
The Biden administration has consistently sided with the union, pressuring port operators to raise wages to ensure an agreement is reached. White House spokesperson Karine Jean-Pierre told reporters on Tuesday that profits for port operators have increased by 800% since COVID-19, with executives’ salaries and shareholder returns seeing similar growth.
When asked if the President would consider invoking the 1947 Taft-Hartley Act to end the strike, Jean-Pierre stated, “We have not used the Taft-Hartley Act, nor do we intend to use it.”
The Washington Post cited Kate Bronfenbrenner, Director of Labor Education Research at Cornell University, who mentioned that the 2024 U.S. election is a closely contested one, where the Democratic Party needs states like Wisconsin, Michigan, and other industrial states to win. The handling of the dockworkers’ strike by Biden could have a significant impact on the party if workers feel angry and refrain from voting.
However, voters have expressed dissatisfaction with inflation and product shortages resulting from supply chain disruptions in 2021 and 2022.
Economists suggest that initial closures of ports will not immediately drive up consumer prices due to accelerated shipping of key goods by businesses in recent months. Yet, Morgan Stanley economists warn that if the strike persists, it will eventually have ramifications, possibly affecting food prices first.
The strike has impacted 36 ports, including those in New York, Baltimore, and Houston, handling various containerized goods.
The National Retail Federation, along with 272 other trade associations, urged the Biden administration on Wednesday to leverage federal powers to stop the strike, warning of potential “devastating consequences” from the ongoing labor dispute.