West Coast Port Labor Disagreements Pose Long-Term Risk

Negotiations between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) continue to be tenuous. The lack of a West Coast port labor contract between the parties is creating considerable uncertainty. Negotiations have been ongoing for the better part of a year after the previous contract expired in July 2022. Earlier in the month, the ports of Los Angeles and Long Beach were shut down due to a lack of workers. Concerns have been raised as to what these types of actions could mean for the ports in the long term.

“While the union is using new tactics, the result is the same: the disruption of terminal operations,” PMA noted in a statement. “As has been pointed out for years, any actions that undermine confidence in West Coast ports threaten to further accelerate the diversion of discretionary cargo to Atlantic and Gulf Coast ports. Cargo diversion places quality jobs at risk far beyond the docks, including truck drivers, warehouse workers, and thousands of others whose livelihoods depend on ongoing operations at the port.”

More recently, PMA said that operations on the ports were again slowed by ILWU. The standard dispatch process was said to have been delayed by ILWU and the union has discontinued staggering meal breaks to avoid interruption in services. The West Coast port labor dispute is contributing to an ongoing trend of shifting port calls to the East Coast. Agriculture Transportation Coalition Executive Director Peter Friedman said the trend began decades ago, but disruption on West Coast terminals is exacerbating the issue. There is uneasiness as to what the shipping disturbances could mean for agricultural exports moving forward.

“The uncertainty that accompanies marine terminal operations without a labor contract, creates a disincentive to invest in additional facilities through which cargo will transit West Coast gateway ports,” said Friedman. “This makes it even more challenging for the West Coast gateways to claw back lost import container market share.”