In a significant development for the U.S. economy, dockworkers on the East and Gulf coasts have solidified a six-year agreement, effectively staving off a strike that could have had debilitating effects. The decision came as no surprise, given that the leadership of the International Longshoremen’s Association (ILA) had already penned a tentative accord in January with the U.S. Maritime Alliance, encompassing ports and shipping enterprises.
After receiving approval from the alliance last month, union members cast their votes, overwhelmingly showing their support with nearly 99 percent in favor, according to an official union statement. The contract promises a substantial 62% salary increment over six years, propelling the top-tier hourly wages from $39 to $63.
ILA President Harold Daggett played a pivotal role as the main negotiator for the union. He described the deal as the “gold standard” for dockworker unions worldwide, acknowledging that the negotiation process was challenging and led to a three-day strike last year. However, Daggett expressed relief that labor peace is now assured for the next six years.
Furthermore, the union and the alliance managed to find common ground concerning automation, a significant sticking point on U.S. docks. The union has voiced concerns that increased reliance on automated machinery, like semi-automated cranes, could displace human jobs. Meanwhile, port operators push for automation to remain competitive with ports in Rotterdam, Dubai, and Singapore.
The newly ratified contract introduces more flexibility for ports to adopt advanced technology. Nonetheless, these ports must commit to hiring new workers during this transition, and fully automated systems are currently not an option. Brian Lynch, head of the transportation sector at EY Americas, noted that while the contract allows for more technological progression, it is a limited adjustment.
The union’s brief strike in October was paused to facilitate further discussions. Had the stoppage continued, it could have disrupted operations at 14 ports from Boston to Houston, impacting American production and increasing costs.
Both parties are scheduled to convene around March 10 to officially sign the agreement, which will subsequently be implemented. Prior to becoming President, Donald Trump voiced his support for the union, asserting via social media that the financial savings gained through automation do not outweigh the damage caused to American workers, particularly longshoremen.
