What Is It And Should I Be Concerned About It?
Friday, October 4, 2024
On October 1st, 2024 the ILA (International Longshoreman’s Association) went on strike
across the east and gulf coasts. This means there will be a halt to all cargo entering and leaving the United States from those respective ports. This is the first east coast port strike since 1977, and will undoubtedly have an effect on supply chains, and as a result the economy at large. What remains to be seen, is how big the effect will be.
The ILA is the largest union of maritime workers in North America, representing more than 85,000 longshoreman. Their workers run ports all along the east coast, the gulf coast, the great lakes, Canada’s east coast, and the Bahamas.
The purpose of the strike is to increase the wages of dock workers, and to protest the growing proliferation of automation. The union initially asked for a 77% pay increase over the next 6 years, as well as a near total ban on automation. So far, the ILA has turned down an offer of a 50% pay increase over 6 years, and to keep limits on automation in tact from old contracts. In regards to the strike, ILA President Harold Daggett said “First week, be all over the news every night — boom, boom. Second week, guys who sell cars can’t sell cars because cars ain’t coming in off the ships — they get laid off. Third week, malls start closing down — they can’t get goods from China, they can’t sell clothes. Construction workers get laid off because the materials aren’t coming in. The steel’s not coming in. The lumber’s not coming in. They lose their jobs. Everybody’s hating the longshoremen now because now they realize how important our jobs are.”
Sadly, this comes at a very tumultuous time for both the United States and the world at large.
It is my opinion that this strike has the potential to be very disruptive for the economy. Not only could it re-ignite the steadily declining rate of inflation, but it could also cause significant shortages for American consumers.
According to Sal Mercogliano, a commentator on the shipping industry, disruptions to shipping take months to be set right. “A day long strike wouldn’t cause any shortages, but would take about week to straighten out. A week long strike could take until November, potentially December. If it’s more than 2 weeks, it’s the new year.” Sadly, this comes at a very tumultuous time for both the United States and the world at large. Hurricane Helene has devastated the southeast United States, war looms in the middle east, and the presidential election is on the horizon. We hope and pray that the strike does not significantly effect the recovery of the southeastern US, however we fear it will.
In a blog post I published last November, I wrote “I put little to no faith in bureaucrats to solve our problems, but I do put a lot of faith in the American economy’s ability to adapt to changing environments and find a way to meet consumer demand. Above all, I put my faith in the One who stitched the world together and wrote the world’s history before it even began.” These words still reflect my sentiment.
I hope you all have a blessed weekend,
M. Grant Pannell
(The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.)
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