Potential for work stoppage at ports looming
Posted: December 22, 2012 - 9:43pm | Updated: December 23, 2012 - 7:28am
File
photo by Richard Burkhart A loaded Yang Ming container ship leaves the
Port of Savannah, a sight that will be missing from the river if
dockworkers go on strike as planned next week.
Dockworkers along the East and Gulf Coast ports — including
Savannah’s — are preparing to walk off the job next weekend in a move
that would have a ripple effect on an already fragile economy and
disrupt the delivery of everything from retail goods and food items to
parts critical to U.S. manufacturers.
Contract negotiations broke down Tuesday between the International Longshoremen’s Association and the U.S. Maritime Alliance, which represents shipping interests and management at 14 deepwater ports from Boston to Houston.
There are no plans to meet again before Saturday, when the current contract extension expires, and ILA President Harold Daggett has been authorized by the union to call the strike.
A work stoppage would effectively shut down container operations at Georgia Ports, the fourth-busiest container port in the country and the second largest on the East Coast.
“It’s beginning to look pretty likely,” said GPA executive director Curtis Foltz. “We’ve been increasingly concerned by the lack of progress in the negotiations and are disappointed the parties haven’t been able to reach a new contract.”
A strike at the Port of Savannah would idle some 1,500 dockworkers, as well as short- and long-haul truck drivers, stevedores, line handlers and other related workers.
If the Alliance calls for a lockout of the ILA, the work stoppage would also affect bulk, breakbulk and roll-on/roll-off cargo, such as auto units and construction equipment.
Asked about contingency plans at Georgia Ports, Foltz said there are none.
“We respect the ILA’s jurisdictional rights here,” he said. “If they aren’t working, our docks won’t be working. Ships won’t be loaded or unloaded.”
Savannah ILA president Willie Seymore declined requests for an interview.
A chess game
Just the spectre of a strike can wreak havoc on the East Coast, Foltz said.
“Logistics supply chains don’t turn on a dime, so even if the issues are resolved fairly quickly, it could take months before all the business comes back.”
Page Siplon, executive director of the Georgia Center of Excellence for Logistics, agreed.
“Logistics is all about planning,” he said. “What everyone wants from their supply chain is to move faster, cheaper and, most important, reliably. But you can’t come close to that when you have to make last-minute decisions.
“That’s why even the threat of a strike sends a ripple of unease through the entire supply chain,” he said.
“It’s like playing chess with billions of dollars in commerce and thousands of jobs.”
Fortunately, supply chains are flexible enough that a short strike shouldn’t do any long-term damage, Siplon said.
Rhett Willis, president of Savannah’s D.J. Powers, one of the oldest Georgia-based freight forwarder and customs brokerage firms in the state, said the possibility of a walk-out has already caused disruptions up and down the supply chain.
“Many of our customers are already acting on their contingency plans, canceling bookings or loading and holding containers,” he said.
“Hopefully this won’t happen,” he said. “And, if it does, hopefully it won’t last long.”
A plea for help
On Thursday, a diverse coalition of more than 100 national and state associations — organized and led by the National Retail Federation — sent a letter to President Obama to “urge immediate action by your administration to ensure that a strike does not occur.”
The coalition — it represents the breadth of the supply chain from auto makers, farmers, manufacturers and retailers — reiterated its call on the president “to take immediate action and use all of the options available to you, including the authority under the Taft-Hartley Act, to keep the parties at the negotiating table and avoid a coast-wide port shutdown.”
The group said failure to reach a contract agreement would have “serious economy-wide impacts.”
Georgia is especially vulnerable.
Jeff Humphreys, University of Georgia economist and director of the Selig Center for Economic Growth at UGA’s Terry College of Business, said the economic damage of a strike could be devastating, especially for a port-dependent state such as Georgia.
“Make no mistake about it, a strike will affect everyone, not just those directly connected to the port,” Humpreys told the Morning News in September.
“If you shop at Walmart, buy groceries or gas, need parts to repair your automobile, you will be affected.
The financial markets won’t be immune, either.
“Even a short term strike could cause some volatility — in the credit markets, the currency market, the stock market — and impact confidence,” he said.
In Georgia, 10 cents of every dollar in sales and 8 percent of jobs — about 352,000 — are port-dependent, Humphreys said.
“While we certainly wouldn’t lose all of those jobs, we do rely more on our ports than most states.”
Humphreys said he doesn’t expect the president to allow a strike to continue long term.
“Our economy is entirely too vulnerable to any type of shock,” he said. “With ports accounting for 8 percent of our GDP, a prolonged port strike would tip the Eastern U.S. back into recession.”
The sticking points
According to the Journal of Commerce, both sides are at an impasse over container royalties, which ILA workers receive at the end of the year and which also go to their benefits. Container royalties are based on the weight of container cargo received at each port.
Ironically, while Savannah ILA locals are prepared to stand in solidarity with their brothers and sisters, it’s not likely container royalties are a big issue here because Savannah’s royalties are among the highest in the country.
“The issues are national, not local, and primarily in the New York area,” said Tom Wright, secretary of the Savannah Maritime Association.
“Our local longshoremen, facilities and agents work well together.”
New York/New Jersey, the largest port on the East Coast, handled 5.5 million TEUs — or 20-foot container equivalents — equaling 12.9 percent of U.S. volumes in 2011. Savannah is next, with nearly 3 million TEUs, or 8 percent.
In addition to his national role, ILA President Daggett also represents a New York local.
Altogether, the ports that would be affected should the ILA go on strike handled 20.7 million TEUs in 2011, 48.5 percent of the total container traffic passing through U.S. ports.
ABOUT THE PLAYERS
The International Longshoremen’s Association, AFL-CIO, is the largest union of maritime workers in North America, representing upward of 65,000 longshoremen on the Atlantic and Gulf Coasts, Great Lakes, major U.S. rivers, Puerto Rico and Eastern Canada. Dockworkers on the West Coast are represented by the International Longshore and Warehouse Union.
According to James Capo of the U.S. Maritime Alliance, which represents management at the 14 deepwater ports along the East and Gulf coasts, ILA members coastwide average $124,138 a year in wages and benefits, “which puts them ahead of all but 2 percent of all U.S. workers. They earn an average hourly wage of $50 — more than double the $23.19 average for all U.S. union workers. They also pay no premiums and minimal co-pays and deductibles for a health care plan that is better than most U.S. employers provide their workers.”
At the Port of New York and New Jersey, 34 ILA members make over $368,000 a year in wages and benefits, Capo said, with one of every three making more than $208,000 a year, not including annual bonuses based on the weight of container cargo.
“These container royalties totaled $232 million in 2011 — or an average of $15,500 for ILA workers on the East and Gulf coasts.”
Local ILA workers reportedly average closer to $30,000 annually in royalties.
The United States Maritime Alliance is a consortium of container carriers, direct employers and port associations serving the East and Gulf Coasts of the United States. While serving as the representative of the management groups in master contract bargaining, the Alliance also articulates industry positions on regulatory and safety issues; oversees coastwide training, retraining, certification and recertification programs and is responsible for administering coast-wide fringe benefit funds and programs.
EXTENDED HOURS ANNOUNCED
In anticipation of a strike beginning Sunday, the Georgia Ports Authority has announced extended gate hours this week at Garden City Terminal, its main container facility. They are:
• Wednesday through Friday: 6 a.m. to 8 p.m. (6-8 p.m. at Gate 4 only)
• Saturday: 8 a.m. to noon and 1-5 p.m.
end quote from:
Potential for work stoppage at ports looming
Contract negotiations broke down Tuesday between the International Longshoremen’s Association and the U.S. Maritime Alliance, which represents shipping interests and management at 14 deepwater ports from Boston to Houston.
There are no plans to meet again before Saturday, when the current contract extension expires, and ILA President Harold Daggett has been authorized by the union to call the strike.
A work stoppage would effectively shut down container operations at Georgia Ports, the fourth-busiest container port in the country and the second largest on the East Coast.
“It’s beginning to look pretty likely,” said GPA executive director Curtis Foltz. “We’ve been increasingly concerned by the lack of progress in the negotiations and are disappointed the parties haven’t been able to reach a new contract.”
A strike at the Port of Savannah would idle some 1,500 dockworkers, as well as short- and long-haul truck drivers, stevedores, line handlers and other related workers.
If the Alliance calls for a lockout of the ILA, the work stoppage would also affect bulk, breakbulk and roll-on/roll-off cargo, such as auto units and construction equipment.
Asked about contingency plans at Georgia Ports, Foltz said there are none.
“We respect the ILA’s jurisdictional rights here,” he said. “If they aren’t working, our docks won’t be working. Ships won’t be loaded or unloaded.”
Savannah ILA president Willie Seymore declined requests for an interview.
A chess game
Just the spectre of a strike can wreak havoc on the East Coast, Foltz said.
“Logistics supply chains don’t turn on a dime, so even if the issues are resolved fairly quickly, it could take months before all the business comes back.”
Page Siplon, executive director of the Georgia Center of Excellence for Logistics, agreed.
“Logistics is all about planning,” he said. “What everyone wants from their supply chain is to move faster, cheaper and, most important, reliably. But you can’t come close to that when you have to make last-minute decisions.
“That’s why even the threat of a strike sends a ripple of unease through the entire supply chain,” he said.
“It’s like playing chess with billions of dollars in commerce and thousands of jobs.”
Fortunately, supply chains are flexible enough that a short strike shouldn’t do any long-term damage, Siplon said.
Rhett Willis, president of Savannah’s D.J. Powers, one of the oldest Georgia-based freight forwarder and customs brokerage firms in the state, said the possibility of a walk-out has already caused disruptions up and down the supply chain.
“Many of our customers are already acting on their contingency plans, canceling bookings or loading and holding containers,” he said.
“Hopefully this won’t happen,” he said. “And, if it does, hopefully it won’t last long.”
A plea for help
On Thursday, a diverse coalition of more than 100 national and state associations — organized and led by the National Retail Federation — sent a letter to President Obama to “urge immediate action by your administration to ensure that a strike does not occur.”
The coalition — it represents the breadth of the supply chain from auto makers, farmers, manufacturers and retailers — reiterated its call on the president “to take immediate action and use all of the options available to you, including the authority under the Taft-Hartley Act, to keep the parties at the negotiating table and avoid a coast-wide port shutdown.”
The group said failure to reach a contract agreement would have “serious economy-wide impacts.”
Georgia is especially vulnerable.
Jeff Humphreys, University of Georgia economist and director of the Selig Center for Economic Growth at UGA’s Terry College of Business, said the economic damage of a strike could be devastating, especially for a port-dependent state such as Georgia.
“Make no mistake about it, a strike will affect everyone, not just those directly connected to the port,” Humpreys told the Morning News in September.
“If you shop at Walmart, buy groceries or gas, need parts to repair your automobile, you will be affected.
The financial markets won’t be immune, either.
“Even a short term strike could cause some volatility — in the credit markets, the currency market, the stock market — and impact confidence,” he said.
In Georgia, 10 cents of every dollar in sales and 8 percent of jobs — about 352,000 — are port-dependent, Humphreys said.
“While we certainly wouldn’t lose all of those jobs, we do rely more on our ports than most states.”
Humphreys said he doesn’t expect the president to allow a strike to continue long term.
“Our economy is entirely too vulnerable to any type of shock,” he said. “With ports accounting for 8 percent of our GDP, a prolonged port strike would tip the Eastern U.S. back into recession.”
The sticking points
According to the Journal of Commerce, both sides are at an impasse over container royalties, which ILA workers receive at the end of the year and which also go to their benefits. Container royalties are based on the weight of container cargo received at each port.
Ironically, while Savannah ILA locals are prepared to stand in solidarity with their brothers and sisters, it’s not likely container royalties are a big issue here because Savannah’s royalties are among the highest in the country.
“The issues are national, not local, and primarily in the New York area,” said Tom Wright, secretary of the Savannah Maritime Association.
“Our local longshoremen, facilities and agents work well together.”
New York/New Jersey, the largest port on the East Coast, handled 5.5 million TEUs — or 20-foot container equivalents — equaling 12.9 percent of U.S. volumes in 2011. Savannah is next, with nearly 3 million TEUs, or 8 percent.
In addition to his national role, ILA President Daggett also represents a New York local.
Altogether, the ports that would be affected should the ILA go on strike handled 20.7 million TEUs in 2011, 48.5 percent of the total container traffic passing through U.S. ports.
ABOUT THE PLAYERS
The International Longshoremen’s Association, AFL-CIO, is the largest union of maritime workers in North America, representing upward of 65,000 longshoremen on the Atlantic and Gulf Coasts, Great Lakes, major U.S. rivers, Puerto Rico and Eastern Canada. Dockworkers on the West Coast are represented by the International Longshore and Warehouse Union.
According to James Capo of the U.S. Maritime Alliance, which represents management at the 14 deepwater ports along the East and Gulf coasts, ILA members coastwide average $124,138 a year in wages and benefits, “which puts them ahead of all but 2 percent of all U.S. workers. They earn an average hourly wage of $50 — more than double the $23.19 average for all U.S. union workers. They also pay no premiums and minimal co-pays and deductibles for a health care plan that is better than most U.S. employers provide their workers.”
At the Port of New York and New Jersey, 34 ILA members make over $368,000 a year in wages and benefits, Capo said, with one of every three making more than $208,000 a year, not including annual bonuses based on the weight of container cargo.
“These container royalties totaled $232 million in 2011 — or an average of $15,500 for ILA workers on the East and Gulf coasts.”
Local ILA workers reportedly average closer to $30,000 annually in royalties.
The United States Maritime Alliance is a consortium of container carriers, direct employers and port associations serving the East and Gulf Coasts of the United States. While serving as the representative of the management groups in master contract bargaining, the Alliance also articulates industry positions on regulatory and safety issues; oversees coastwide training, retraining, certification and recertification programs and is responsible for administering coast-wide fringe benefit funds and programs.
EXTENDED HOURS ANNOUNCED
In anticipation of a strike beginning Sunday, the Georgia Ports Authority has announced extended gate hours this week at Garden City Terminal, its main container facility. They are:
• Wednesday through Friday: 6 a.m. to 8 p.m. (6-8 p.m. at Gate 4 only)
• Saturday: 8 a.m. to noon and 1-5 p.m.
end quote from:
Potential for work stoppage at ports looming
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