Leaders from the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) management group signed a new six-year Master Contract on March 11.
The USMX represents shipping lines, terminal operators and port authorities. The Master Contract, signed at a ceremony in New Jersey, is effective from October 1, 2024, through September 30, 2030.
The two sides hailed the new agreement as a “win-win” for both the ILA and USMX as it “protects current ILA jobs and establishes a framework for implementing technologies that will create more jobs while modernizing East and Gulf Coast ports.”
“I am proud to have produced this new agreement with the help of my ILA Wage Scale Committee for my ILA members,” said ILA President Harold Daggett. “We achieved a record-setting 62% increase in wages; full protection against automation; accelerated wages raises for new workers; full container royalty funds returned to the ILA; the best medical plan in our MILA national health care program that fully protects our ILA members and their families; and raises in contributions to money purchase plans.”
2024 Strike
On October 4, 2024, the union members went back to work after a short ILA strike affecting 45,000 dockworkers at 36 container ports from Texas to Maine — including New York/New Jersey, Houston, and Savannah, Georgia. The contract covers six of the 10 busiest U.S. ports, which collectively handle more than 13 million containers annually. In the interim, freight rates surged and shipping stocks sank. The ILA issued a memo to its members outlining the tentative agreement reached with USMX on wages. Both sides eventually ratified an agreement.
Previously, on October 2, 2024, more than 175 organizations — including the California Chamber of Commerce — representing U.S. manufacturers, farmers and agribusinesses, wholesalers, retailers, restaurants, importers, exporters, distributors, transportation and logistics providers, and other supply chain stakeholders sent a letter to President Joe Biden calling on the administration to intervene.
As of Thursday, October 3, 2024, at least 54 container ships had lined up outside the ports as the strike prevented unloading, according to Everstream Analytics, threatening shortages of anything from bananas to auto parts. More than another 120 container ships were en route, so the impact was felt for weeks.
Shipping Data
Nearly 70% of U.S. exports and 56% of containerized U.S. imports come through East Coast and Gulf Coast ports, according to data cited by the National Association of Manufacturers. More specifically:
- More than 68% of all containerized exports and more than 56% of containerized imports flow through East and Gulf Coast ports, representing an average daily trade value of more than $2.1 billion.
- They handle more than 91% of containerized imports and 69% of containerized exports of pharmaceutical products.
- They also process more than 76% of containerized vehicle exports and more than 54% of containerized vehicle imports.
- For aircraft and spacecraft, more than 77% of containerized exports and more than 51% of containerized imports go through these ports.
Perishable food imports, wine, auto parts and pharmaceuticals from Europe could have been greatly affected. Ports on the East and Gulf coasts handle roughly 75% of the bananas that enter the United States. There is a no strike pledge for U.S. military goods and passenger cruise vessels would not have been affected. The ILA had not gone on strike since 1977.
West Coast Impact
A prolonged shutdown would have affected West Coast ports, eventually leading to capacity and empty container shortages.
Imports to the U.S. West Coast ports increased during this period. Container carriers were rerouting Halloween costumes and Christmas items in preparation for the labor action. And manufacturers purchased solar panels and other goods targeted for potential tariff increases. Rerouting adds time and costs to businesses and the consumer.
The 2024 strike came at a challenging time for ocean supply chains, which already faced significant disruptions the previous year with the drought in the Panama Canal, the Baltimore Bridge collapse, and the Red Sea conflict. There was talk of West Coast workers being unwilling to unload cargo originally bound for the East Coast and a worst-case scenario if the West Coast dock workers walked out in solidarity.
The Federal Maritime Commission (FMC) had warned carriers and operators against imposing excessive detention and demurrage fees during the strike, to protect shippers from unfair charges such as occurred during the pandemic-related port congestions.
The Biden administration faced pressure to intervene but expressed reluctance to invoke the Taft-Hartley Act by imposing an 80-day cooling-off period. Ultimately, then-President-elect Donald Trump did support the ILA.
The Biden administration did step in to help the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) resolve their 29 West Coast port labor negotiations in 2023 after their contract expired July 1, 2022. The West Coast ports account for more than 44% of nationwide container port traffic.
CalChamber Position
The CalChamber believes an immediate resolution to the strike was needed for the East Coast, and the nation as a whole. The CalChamber knows from recent history that any blip in the supply chain disrupts commerce, delays critical goods from reaching the market, and drives up costs for businesses and consumers.
Staff Contact: Susanne T. Stirling
