Financial Union News October 4 (Editor Zhou Ziyi) On Thursday local time (October 3), American dock workers agreed to end their three-day strike. This strike caused trade paralysis along the US East Coast and the Gulf of Mexico and became a major factor affecting the outcome of the US presidential election.

On Thursday, the International Longshoremen's Association (ILA) and the employer group United States Maritime Alliance (USMX) stated in a joint statement that preliminary agreements on wages had been reached between port workers and operators. They agreed to extend the main contract until January 15, 2025, to allow more time for discussions on a new long-term labor contract to address other outstanding issues.

ILA President Scott Cowan announced, "The strike is over," and the union also stated that on Friday morning, the port will resume operations.

Temporary Agreement

The temporary agreement reached by both labor and management includes a 62% raise over the next six years. This raise will increase workers' average hourly wage from $39 to $63.

Although the raise percentage did not meet the union's expectation – ILA had been seeking a 77% raise while USMX had previously raised its proposed raise to nearly 50%, at a time just weeks before the election, this agreement gave ILA and USMX more time to address more contentious issues without threatening the US economy.

This temporary agreement marks the end of the largest work stoppage in nearly 50 years. The strike disrupted transportation of goods from food to autos from the state of Maine to Texas, potentially causing shortages of various commodities from bananas to auto parts and resulting in backlogs of ships outside major ports.

This three-day strike is not just a simple labor dispute, but also a severe challenge to the stability of the global supply chain, which has severely affected the operation of 36 ports and caused huge economic losses.

It is estimated that the daily economic losses in the United States range from 3 billion to 5 billion dollars, causing great distress to related companies and consumers.

The National Retail Federation stated in a declaration, "The decision to end the strike and allow the reopening of ports on the East Coast and the Gulf Coast is good news for the U.S. economy. The sooner they reach a final agreement, the better for all American households."

Avoiding crisis

During the three-day port strike, Americans began to panic about potential shortages. Some anxious shoppers hoarded commodities, especially in areas affected by the hurricane "Helene."

It is reported that a national chain grocery store in the United States has imposed purchasing limits on paper towels, toilet paper, and water. The shelves in many supermarkets displaying toilet paper and paper towels are also empty, increasing the pressure on U.S. President Biden to take intervention measures.

No matter how brief the newly reached agreement is, it has ultimately alleviated the public's panic and eliminated a potential political issue for the White House and Vice President Kamala Harris in their election campaign, as a prolonged strike would force Harris to confront a crisis of exacerbated inflation.

The new agreement has defused a political time bomb for Democrats in the United States. Democrats cannot afford a lengthy strike, as they need all the union support they can get, and strikes would make voters discontent with the economy.

After reaching the agreement, President Biden chose to stand on the side of the union, stating in a statement on Thursday, "I want to thank the union workers, container companies, and port operators for their patriotic actions. They reopened our ports, ensuring the availability of key supplies for recovery and rebuilding from Hurricane Henri. Collective bargaining is effective."

However, the supply chain data company project44 from Chicago stated that although the strike only lasted for three days, it may take over a month to clear the backlog of goods. The strike prevented unloading, and it will take some time to fully reopen.

At the same time, dozens of ships carrying containers and cars are anchored off the coasts of major trade centers such as New York, South Carolina, and Virginia.

Editor/ping