The International Longshore Warehouse Union and the Pacific Maritime Association have been arguing over labor contracts since earlier this year. Their disagreements have caused major delays at the West Coast ports. Months later, there is still is no progress.Some people fear the economy is going to take a major hit because of the port delays. Money has already been loss, but it could get a lot worse. West Coast ports handle two-thirds of retail container cargoes for the U.S., most of which come from Asia. If you remember back in 2002, labor disputes lead to a 10-day lockout at the ports, causing more than $10 billion in lost revenue. At that time, President Bush had to use the Taft-Hartley Act for emergency provisions. Some wonder whether the same thing will occur this year at the ports.
Supply chain stakeholders are trying to prevent bigger delays by urging the West Coast ports to talk. The National Retail Federation sent letters to both the International Longshore Warehouse Union and the Pacific Maritime Association on October 9 and October 20, but there is still no progress in the negotiations. Several national and local organizations even signed the second letter from the National Retail Federation to create urgency.
The previous labor contract between the two groups expired on July 1, 2014, but workers have continued to work despite new contract disagreements. A labor strike and lockout is not expected, but retailers are concerned with the possibility, especially since the holiday season is approaching. The National Retail Federation shows a high level of concern, as well.
The LA and Long Beach ports are the most impacted by the contract disagreements. These are crucial entry points because 40 percent of cargo enters through these ports. Thousands of businesses rely on the ports and the congestion problem needs to be resolved before the economy takes a bigger hit.