The twin ports of Long Beach and Los Angeles haven’t seen a major strike in years, and the work stoppage that began Thursday night and ran into Friday may end up being a minor hiccup on the way to a new contract for dockworkers.
But past labor disputes have had an undeniable impact on L.A.-Long Beach port operations and revenues, sometimes causing billions of dollars in losses and snarling goods movement.
“The supply chain slows down, stuff doesn’t move—that’s always the big issue,” said Geraldine Knatz, who worked at the ports for three decades and served as executive director of the Port of Los Angeles from 2006 to 2014.
The current work stoppage takes place after 11 months of talks between the International Longshore and Warehouse Union and their employers, represented by the Pacific Maritime Association, have failed to produce a new contract. Both sides have declined to speak with media while negotiations are ongoing.
Any economic consequences of a work stoppage or strike would depend on how long it takes to resolve, Knatz said.
In 2012, an eight-day strike by the 800-member clerks union cost the Southern California region an estimated $8 billion in wages, cargo that went to other ports and other losses, Reuters reported at the time.
That strike ended after then-Los Angeles Mayor Antonio Villaraigosa stepped in, brought Knatz with him and “pulled an all-nighter” to get the clerks and port management to agree to a deal, Knatz said.
In the past, concerns about disruption of the supply chain and the larger economy have prompted even higher-profile intervention. In 2002, President George W. Bush invoked a 1947 law known as the Taft-Hartley Act to end an 11-day lockout that had shut down 29 West Coast ports, according to a New York Times article at the time.
When negotiations drag on as they are now, “people get frustrated that there’s not enough action happening, that they’re not making progress,” Knatz said. “If it gets severe enough, you’re going to have the White House taking an interest in it.”
The most immediately visible impact of a slowdown or halt at the Los Angeles and Long Beach ports will be familiar to Southern California residents from the pandemic: a growing proliferation of cargo ships in the waters offshore.
“The first thing that happens is ships wind up piling up off the coast, so the first thing we do is put those at anchor that fit at anchor,” said Capt. Kip Louttit, executive director of the Marine Exchange of Southern California. The exchange monitors and manages ship activities in the twin ports.
Those that can’t nab one of the limited spots at anchor will loiter offshore, powered by their generators, until a berth comes open. In October and November 2021, 55 ships sat at anchor and another 62 vessels loitered, Louttit said, but recent revisions to outdated plans mean that today there’s a maximum of about 30 anchorages.
On Friday afternoon, there were about two dozen ships at the ports of LA and Long Beach.
A union official, however, said Friday that dockworkers are expected to be back at the terminals in full Friday night and through the weekend. The union attributed the dockworker shortage to union members attending its monthly meeting and observing religious holidays.
But in the event of a prolonged shut-down, some shippers may decide to peel off and either sail north to Oakland or Tacoma, or head down to the Panama Canal and then up the east coast to ports there. That could cost this region billions of dollars across the supply chain, from truckers who haul goods to warehouses that store goods to the businesses that need the goods on shelves.
Automation of port functions was a major sticking point for port workers and management in their 2002 dispute, and it remains an issue today. And the protracted negotiations have already had an impact: in October 2022, the Conference Board said cargo was already being diverted away from the L.A. and Long Beach ports because of uncertainty over the unsuccessful talks.
The board, a business association and think tank, also predicted that in the event of a strike or lockout, federal authorities “would likely intervene very quickly to limit the stoppage to just a few days.”
In fact, a coalition of trade associations has already called for President Biden to step in and help the port workers’ union and their employers reach an agreement, according to a March 23 letter from the more than 200 organizations.