A collective sigh or relief was breathed across the country late yesterday as the 45,000 dockworkers at East and Gulf coast ports are returning to work after their union reached a deal to suspend a strike that was beginning to have an impact on the U.S. economy and supply chain.
But the unfortunately, the end of the strike may only be temporary.
According to the Associated Press (AP), The International Longshoremen’s Association is suspending its three-day strike until Jan. 15 to provide time to negotiate a new contract.
The union and the U.S. Maritime Alliance, which represents ports and shipping companies, said in a joint statement that they have reached a tentative agreement on wages.
Per the AP report, a person briefed on the agreement said the ports increased their wage offer from about 50% over six years to 62%. The person didn’t want to be identified because the agreement is tentative.
Any wage increase would have to be approved by union members as part of the ratification of a final contract.
Future talks will now focus on the automation of ports, which the unions says will lead to fewer jobs, and other sticking points.
A major strike and shutdown could have a major impact on the economy, even if for just a short time.
Industry analysts have said that for every day of a port strike it takes four to six days to recover. But they said a short strike of a few days probably wouldn’t tie down the supply chain too badly.
The settlement pushes the strike and any potential shortages past the November presidential election, eliminating a potential liability for Vice President Kamala Harris, the Democratic nominee.
It’s also a big plus for the Biden-Harris administration, which has billed itself as the most union-friendly in American history. Shortages could have driven up prices and reignited inflation.
The union went on strike early Tuesday after its contract expired in a dispute over pay and the automation of tasks at 36 ports stretching from Maine to Texas.
The strike came at the peak of the holiday season at the ports, which handle about half the cargo from ships coming into and out of the United States.
However, most retailers had stocked up or shipped items early in anticipation of the strike.
“With the grace of God, and the goodwill of neighbors, it’s gonna hold,” President Joe Biden told reporters Thursday night after the agreement.
Biden also applauded both sides “for acting patriotically to reopen our ports and ensure the availability of critical supplies for Hurricane Helene recovery and rebuilding.”
Biden said that collective bargaining is “critical to building a stronger economy from the middle out and the bottom up.”
The union’s membership won’t need to vote on the temporary suspension of the strike. Until Jan. 15, the workers will be covered under the old contract, which expired on Sept. 30.
The union had been demanding a 77% raise over six years, plus a complete ban on the use of automation at the ports, which members see as a threat to their jobs. Both sides also have been apart on the issues of pension contributions and the distribution of royalties paid on containers that are moved by workers.
Thomas Kohler, who teaches labor and employment law at Boston College, said the agreement to halt the strike means that the two sides are close to a final deal.
“I’m sure that if they weren’t going anywhere they wouldn’t have suspended (the strike),” he said to the AP. “They’ve got wages. They’ll work out the language on automation, and I’m sure that what this really means is it gives the parties time to sit down and get exactly the language they can both live with.”