Tens of thousands of longshoremen could walk off the job from Maine to Texas next week if their union and management can’t resolve long-running contract issues.
A damaging strike that kicks off a few days before President-elect Trump takes office could be his first economic test, with big business bristling at the economic toll that’s been threatened by the head of the International Longshoremen’s Association (ILA), who says he shares a “strong relationship” with Trump.
ILA workers went on strike in October after the union and the U.S. Maritime Alliance (USMX), a group of port operators and shipping companies, failed to reach an agreement ahead of the contract deadline. The two sides struck a deal — with the help of Biden administration officials — to end the three-day strike that included a 62 percent wage increase over the next six years.
That pay raise and other forms of compensation could be off the table if the parties can’t come to an agreement on automation ahead of the Jan. 15 deadline. The ability to automate port functions will affect capital expenditures that shippers and port operators would like to make, which would be a factor in determining the overall dollar value of the labor contract for USMX, one labor-side source told The Hill.
The person said they “wouldn’t be shocked at all” if the union chose to strike in a week’s time.
“With unresolved issues around automation and job security, the outcome of these talks could significantly impact global supply chains. Earlier agreements delayed disruptions, but pressure is mounting for a lasting resolution,” said John Donigian, senior director of supply chain strategy at Moody’s.
The ILA and the USMX are reportedly heading back to the bargaining table Tuesday after negotiations broke down in November, when management pushed for more contractual leeway on incorporating new technologies. The union strongly opposes the automation of ports, saying it would put union jobs at risk.
The USMX denied that its proposal aims to eliminate jobs and said that an agreement barring automation “would move our industry backward by restricting future use of technology that has existed in some of our ports for nearly two decades.”
“What we need is continued modernization that is essential to improve worker safety, increase efficiency in a way that protects and grows jobs, keeps supply chains strong, and increases capacity that will financially benefit American businesses and workers alike,” the USMX said in a statement.
Having more thoroughly automated ports, like those in China, is of major interest to investors in the logistics industry, both labor and management-side sources told The Hill.
The ILA declined to comment during negotiations. The USMX did not respond to The Hill’s request for comment.
Trump, who takes office on Jan. 20, days after the strike deadline, appeared to side with longshoremen on the issue of automation last month.
“I’ve studied automation, and know just about everything there is to know about it. The amount of money saved is nowhere near the distress, hurt, and harm it causes for American Workers, in this case, our Longshoremen,” Trump said in a post on his social media platform Truth Social in December.
“Foreign companies have made a fortune in the U.S. by giving them access to our markets. They shouldn’t be looking for every last penny knowing how many families are hurt,” he added. “They’ve got record profits, and I’d rather these foreign companies spend it on the great men and women on our docks, than machinery, which is expensive, and which will constantly have to be replaced. In the end, there’s no gain for them, and I hope that they will understand how important an issue this is for me.”
Donigian said Trump’s support for the dockworkers “reflects broader debates over balancing labor concerns with the need for modernization to maintain efficiency and global competitiveness.”
While Trump took heat during his campaign when he joked about firing striking workers during an August interview with billionaire Tesla CEO Elon Musk, the incoming president positioned himself as a friend to unions, inviting Teamsters General President Sean O’Brien to be the union’s first president to speak at the Republican National Convention this summer.
ILA International President Harold Daggett has said he has a “strong relationship” with Trump. He met with Trump at Mar-A-Lago in December to update him on the state of the negotiations, which preceded the president-elect’s social media post.
Daggett made headlines ahead of the first work stoppage when he warned his union could “cripple” the economy, which is more likely the longer a potential strike lasts. While consumers would feel little to no impact during the first week of the strike, experts previously told The Hill that they would probably be feeling the pinch as perishables and auto parts get backed up after a week or two and coffee, champagne, cheese and more start disappearing a month in.
“The timing is critical,” said Donigian. “Retailers are replenishing post-holiday inventory, manufacturers are securing components, and the upcoming Chinese New Year adds pressure to strained shipping networks. A disruption now could ripple through key sectors like retail, automotive, electronics and agriculture, driving up costs, delaying production and impacting inventory levels.”
A strike could grind billions of dollars in trade to a halt, cost the U.S. economy as much as $5 billion per day and up inflationary pressures. Trade associations representing a wide range of industries have urged both sides to strike a deal to avoid disruptions and uncertainty.
“Paralyzing these critical global commerce gateways will lead to shipment delays, increased costs, and potential supply shortages that could impact multiple sectors of the economy. And the longer a work stoppage goes on, the more consumers will feel the ripple effects,” the Retail Industry Leaders Association (RILA) said in a statement Monday.
During the October strike, business leaders including the U.S. Chamber of Commerce pushed Biden to invoke the Taft-Hartley Act, which allows presidents to ask a court for an 80-day “cooling off” period for strikes that “imperil the national health or safety.”
Biden declined to invoke Taft-Hartley, which would have been a political minefield ahead of the 2024 election. The last president to invoke Taft-Hartley was George W. Bush in 2002, who used it during port strikes on the West Coast to end an employer lockout.
The Hill has contacted a Trump transition spokeswoman to ask if the president-elect would consider invoking the Taft-Hartley Act if the longshoremen strike.
