Southern California ports closed Friday, snarling cargo traffic

A shortage of dock workers at the ports of Los Angeles and Long Beach stretched into its second day on Friday, halting freight traffic at the massive shipping complex while disrupting local economies and global supply chains.

The shortage comes several months into protracted labor negotiations between the union that represents dock workers on the West Coast and the industry group that represents maritime shippers, who are working on a new contract focusing on wages and the role of automation. The old contract, which covers more than 22,000 workers at 29 ports, expired on July 1[ads1].

The Pacific Maritime Assn., the industry group that represents shippers at the bargaining table, said in a statement Friday that the International Longshore and Warehouse Union had taken a “concerted action to hold back labor.”

“A majority of the jobs for yesterday’s shift were left unfilled, including all cargo handling equipment operator jobs needed to load and unload cargo,” the statement said. “The workers who showed up were let go because there weren’t a full number of ILWU members to man the terminals.”

ILWU Local 13 said in a statement Friday afternoon that members “continue to work hard and remain committed to moving the nation’s cargo.” The staff shortage occurred because several thousand members had attended a monthly meeting on Thursday night and then took the Good Friday holiday, as allowed under the contract.

Although both sides have remained largely tight-lipped about the status of the contract negotiations, the latest developments underscored their importance.

“This is clearly a wake-up call for port operators,” said Harley Shaiken, a professor emeritus at UC Berkeley who specializes in labor issues. “This process has not only been slow, it has been accompanied by very high stakes in the balance sheet.”

Because its members can shut down ports all along the West Coast, Shaiken said, the union has unprecedented power, especially for the size of its workforce.

“This has already captured the nation’s attention,” he said, “and should add a sense of urgency to the negotiations.”

The LA and Long Beach ports combined handle nearly 40% of America’s imports from Asia, which arrive in giant metal containers aboard vessels nearly the length of the Empire State Building. But cargo movement has fallen sharply in recent months, allowing the combined ports of New York and New Jersey to periodically take the No. 1 bragging rights from Los Angeles.

The local downward trend is worrying not only for officials at the Twin Ports, but also for 175,000 Southern California workers — employed at the ports themselves as well as in related businesses — who move $469 billion worth of cargo a year, port data show . Jobs throughout the supply chain are at stake, including truck drivers, warehouse workers and people employed by logistics specialists.

“It’s important that things get back to normal as quickly as possible,” said Jock O’Connell, an international trade economist, who noted that local ports have lost significant business to their East and Gulf Coast rivals. U.S. traders and producers diverted cargo after a large backlog in San Pedro Bay that started in 2020, taking advantage of significant investment at competing ports looking to bring shipping business away from Southern California.

“It’s likely that some of that business will never come back,” said O’Connell, who works for Beacon Economics. The current shutdown, he added, will create a ripple effect, affecting a myriad of jobs and industries tangentially linked to the movement of cargo through the region.

The “economic impact of this closure will be felt,” he said.

It’s a precedent of contentious, long-running labor disputes that translate not only to temporarily diverted business, but also to more permanent changes, according to James Sterns, an associate professor in the Department of Applied Economics at Oregon State University.

In 2016, for example, vicious labor disputes at the Port of Portland led to both of the port’s container terminal operators leaving the port for good.

In a statement Friday, Port of Los Angeles officials said they were talking with both the union and the Pacific Maritime Assn., as well as local, state and federal officials, about returning to normal operations.

“Resuming cargo operations at America’s busiest port complex is critical,” the statement said, “to maintain the confidence of our customers and supply chain stakeholders.”

The National Retail Federation also released a statement Friday saying the retail group had expressed concern about the White House shutdown and urged administration officials to step in to prevent further disruption.

Last month, the union – along with dozens of other associations – sent a letter to President Biden, asking his administration to offer mediation services to both negotiating parties and do everything in its power to ensure that an agreement is reached as soon as possible.

The economic importance of the ports of Los Angeles and Long Beach is great enough that US presidents have previously advocated getting cargo moving again.

In 2002, President Bush entered into an 11-day shutdown of 29 West Coast ports to halt an employer lockout of West Coast seafarers. In 2021, ahead of the freight holiday season, Biden helped broker a plan to extend hours at local ports, hoping to ease bottlenecks that were becoming increasingly severe amid the strains of the COVID-19 pandemic.

The president, O’Connell said, is likely also overseeing the current shutdown.

“A Democratic president doesn’t like problems like this,” he said. “It’s a labor issue, and President Biden is going to try to make sure this doesn’t get out of hand.”

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