Shipping containers pile up at the Port of Baltimore on September 21, 2018. Longshoremen on the East Coast and Gulf Coast have already threatened a strike on October 1 if a new contract agreement is not reached.

Brendan Smialowski/AFP via Getty Images

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Brendan Smialowski/AFP via Getty Images

About 25,000 longshoremen at ports on the East and Gulf Coasts, from Boston to Houston, could strike as early as October 1.

Their union, the International Longshoremen’s Association, has been in contract negotiations for months with the United States Maritime Alliance, which represents shipping companies and port operators. But the two sides have not met in person since June.

The alliance filed a complaint with federal labor officials this week, accusing the union of refusing to negotiate. The union called the move a “weak advertising campaign” and said both sides had communicated several times in recent weeks.

More than 170 industry groups, from the National Association of Manufacturers to the US Dairy Export Council to the Fashion and Jewelry Trade Association, have called on the Biden administration to intervene, warning that a strike would have a devastating impact on the economy.

What is the standoff about?

Two big sticking points are wages and automation. When it comes to wages, neither side has made their demands or offers public.

A statement from union President Harold Daggett noted that the union may seek a $5 hourly increase in each year of a six-year contract and increase the top hourly wage from $39 to $69 through the end of the contract .

Wage increases under the current contract, signed in 2018, were far more modest, amounting to just $1 an hour increases in four of the six years. That contract, which expires Monday, spanned the pandemic, as longshoremen stayed on the job, and months of soaring inflation.

The US Maritime Alliance says its current offer includes “industry-leading wage increases.” Longshoremen on the West Coast received a 32% pay increase in their contract negotiations last year.

On the topic of automation, Daggett warns longshoremen that the foreign companies that operate the shipping terminals are trying to replace them with machines.

Ports around the world and even on the West Coast are already using advanced technology to transport shipping containers.

The US Maritime Alliance said it has offered to maintain the current ban on fully automatic equipment and maintain the requirement that any use of semi-automatic equipment be negotiated.

In fact, the impact of automation on port workers is not yet fully understood. The shipping industry, supported by UC Berkeley researchers, has argued that automation helps ports remain competitive and handle more goods, which in turn creates demand for highly skilled workers.

The International Longshoremen’s Association remains strongly opposed, citing job losses due to automation on the West Coast.

Which ports would be affected?

According to the US Maritime Alliance, there are 14 ports where longshoremen could go on strike. These are the ports of Boston, New York/New Jersey, Philadelphia, Baltimore, Norfolk, Wilmington, Charleston, Savannah, Jacksonville, Miami, Tampa, Mobile, New Orleans and Houston.

Longshoremen at West Coast ports are represented by a different union. After long negotiations, they agreed on a new contract agreement last year.

What does this mean for goods from abroad?

It depends on the goods.

A lot moves through the ports on the East and Gulf Coasts, from agricultural products to pharmaceuticals and heavy machinery to clothing, shoes and toys.

According to the National Association of Manufacturers, these ports account for more than half of container imports.

As the labor dispute brews, some retailers are starting to ship goods earlier and have rerouted some shipments to the West Coast, said Jonathan Gold, vice president of supply chains and customs at the National Retail Federation.

“We definitely hope that there are no empty shelves,” says Gold, referring to the upcoming holidays. “I think retailers are doing everything they can to make sure that doesn’t happen.”

But a work stoppage could have immediate devastating consequences for other businesses, including manufacturers that rely on “just-in-time” inventories to produce goods and agricultural exporters that have only a short window to ship their products abroad delivery.

And Gold points out that even a one-day closure would be damaging, as it would likely take several days to get operations back up and running.

What did the White House say?

The Biden administration says it has encouraged all parties to continue negotiating and to do so in good faith.

But the White House has made clear that President Biden is not considering invoking the Taft-Hartley Act. Under the 1947 law, the president can ask a court to order an 80-day cooling-off period if the country’s public health or safety is at risk.

In 2022, Biden was criticized for signing a measure that imposed a labor contract on freight railroad workers, ending the possibility of a nationwide rail strike.

In the run-up to the presidential election, the government would probably not want to risk such a backlash from unions, one of its key constituencies.