The National Retail Federation (NRF) recently sent a letter to President Obama detailing the retail industry’s growing concern regarding the contract dispute between the International Longshoremen’s Association and the United States Maritime Alliance, Ltd. The two sides have been in negotiations, with the assistance of federal mediators, for the past few months with little demonstrable progress.
“A strike of any kind at ports along the East and Gulf Coast could prove devastating for the U.S. economy,” NRF president and CEO Matthew Shay wrote to the president. “We call upon you to use all means necessary, including Taft-Hartley, to keep the two sides at the negotiating table and head off a coast-wide strike.”
Any supply chain disruption at the ports would immediately impact every importer and exporter – potentially disrupting or delaying spring and summer retail merchandise – that utilizes the facilities along the East and Gulf Coasts from Boston to Houston.
If a strike or lockout occurs, the president could utilize the Taft-Hartley Act to end the job action and force the two sides back to the negotiating table. The Act -- which seeks to protect the free flow of commerce – was last invoked by President George W. Bush during the 2002 West Coast ports lockout. Economists estimate that the 10-day lockout in 2002 cost the U.S. economy $1 billion per day and took more than six months for the supply chain to recover.
“Allowing a strike to occur for even one day could have a negative impact on all of those downstream businesses and employees who rely on the ports,” Shay wrote. “The U.S. economy cannot afford to wait for a strike to occur before we see administration action. We urge you to get engaged now with these parties to ensure a strike does not occur.”
While another round of talks is scheduled for this week, if both sides fail to extend the negotiations or reach an agreement by the Dec. 29 contract deadline, a port strike is highly probable. Fifteen separate container ports – Boston, New York/New Jersey, Delaware River, Baltimore, Hampton Roads, Wilmington, Charleston, Savannah, Jacksonville, Port Everglades, Miami, Tampa, Mobile, New Orleans, and Houston – would immediately cease operations. A strike at these ports has not occurred since 1977.
The Washington, D.C.-based NRF represents retailers of all types and sizes, including chain restaurants and industry partners, from the United States and more than 45 countries abroad.