Tag: Port Strike

Sides Reach a Tentative Agreement to Avoid Port Strike

Late last night the Federal Mediation & Conciliation Service announced that the ILA and USMX have reached a tentative agreement that would avoid a looming port strike beginning Feb 6. Manufacturers are hopeful that both sides will ratify the deal swiftly.

The threat of a strike has added significant costs to manufacturers operations as they were forced to make costly contingency plans to avoid supply chain disruptions. The result of a strike would likely cost our economy $1 billion a day. The tentative agreement is a positive step forward, and a signed agreement will give manufacturers certainty that their supply chains will not be disrupted on the East and Gulf Coasts.

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Talks to Resume to Avoid Costly Port Strike

Contract negotiations between the U.S. Maritime Alliance (USMX) and the International Longshoremen’s Association (ILA) are scheduled to resume this week. Manufacturers urge both sides to reach a resolution to these talks ahead of the February 6 deadline.

The looming threat of a work stoppage in the beginning of February continues to cast a dark cloud over manufacturers who rely on the nation’s East and Gulf Coast ports to export products and receive goods. The economy cannot afford the consequences of any work stoppage at the ports and manufacturers will feel the full impact if both sides cannot come to an agreement.

The $1 billion per day cost of the 10-day West Coast port lockout in 2002 and the months it took to recalibrate the ports from this major disruption needs to be more than a reminder, but an incentive for both sides to soon reach an agreement. 

While manufacturers have planned for a potential disruption and continue to implement costly contingency arrangements in advance of February 6, concluding negotiations with an agreed upon contract before the deadline is the best solution.

Forward exporting, diverting cargo, increasing inventories and renting additional warehouse space do not position manufacturers for growth. Manufacturers will need greater assurances and a strong signal this week that a contract is an achievable goal in order to move beyond this palpable uncertainty.  Global customers need to know now that we will be open for business. 

Robyn Boerstling is director of transportation and infrastructure policy, National Association of Manufacturers.

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Manufacturers Welcome Progress to Avoid Port Strike, Urge Parties to Swiftly Come to a Final Agreement

Manufacturers welcomed the news this morning that the U.S. Maritime Alliance (USMX) and the International Longshoremen’s Association (ILA) have agreed to a 30-day extension to resolve their differences to avoid a dockworkers strike of the East and Gulf Coast ports.

However, it is critical that both parties use this time wisely to reach an agreement as soon as possible to avoid a strike at the end of the 30-day extension. Manufacturers implemented costly contingency plans this month, and the last thing manufacturers need is a repeat of the same scenario in January. Even with this progress outlined today, uncertainty remains until a final agreement is reached. Due to the complex nature of manufacturing supply chains, manufacturers must plan far ahead, and the continued potential for a strike in 30 days will result in additional costs to minimize the impacts of any port disruptions.

According to the Federal Mediation and Conciliation Service, both parties have agreed in principle to resolve the royalty payment issue, and the 30-day extension will give them time to work out other differences. This is a positive development to help avoid a port strike at the worst possible time for manufacturers.

With manufacturers already facing the fiscal cliff in three days, a port strike would have been another crippling blow to our economy. A strike would likely cost our economy an estimated $1 billion a day. Supply chains would be disrupted, putting manufacturing jobs at risk and halting exports. The National Association of Manufacturers has urged both sides to come to an agreement to protect jobs. We are hopeful that a final agreement will be reached as soon as possible so we can put any additional uncertainty from a port strike to rest.

Robyn Boerstling is director of transportation and infrastructure policy, National Association of Manufacturers.

Recent News Coverage:

-Ports on East Coast threatened by strike (USA Today)
- “Obama pressed to act as dockworker unions threan massive port strike” (The Hill)
- “Looming port strike could cost economy billions” (CNN Money)

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