Freight labor unrest emerging globally

The US West Coast port labor talks have stalled, creating uncertainty and causing shippers to divert cargo from West Coast ports to those on the East Coast. The twin hub Ports of Los Angeles and Long Beach are especially critical to the US economy. Together they handle more cargo than any ports in the United States—including 42 percent of all annual containerized trade with Asia. Although no strike is currently planned, and both sides say they are committed to keeping normal operations throughout the negotiation period, businesses have reason for concern due to a history of disruptions during past negotiations and potential impacts on costs and schedules during a period of high inflation.

The West Coast port issues are part of an emerging trend of freight labor unrest globally, particularly as inflation puts pressure on wages. Workers at the United Kingdom’s largest port, Felixstowe, as well as the Port of Liverpool, conducted strikes in September and October 2022. A US rail strike was averted with a tentative agreement between management and rail workers just hours before the deadline (see The Conference Board blog post: Possible Freight Rail Strike Would Upend Supply Chain). These added uncertainties are expected to increase cost pressures and time frames on shippers and their customers.

For more details, see West Coast Port Labor Talks Stall.