US manufacturers worry about West Coast port labour disruption

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WASHINGTON, D.C. — It’s not just Canadian ports that are dealing with labour unrest and its potential implications.

A new study from the National Association of Manufacturers (NAM) and National Retail Federation (NRF) in the US has highlighted the economic harm that could result from a labour disruption at US ports. A new contract agreement covering 13,600 dockworkers at 30 US ports along the US West Coast is currently under negotiation.

If a deal isn’t soon reached, the consequences could be severe, the manufacturers warn.

“A protracted dispute between the negotiating parties could lead to reduced or shuttered terminal operations for an extended period,” the joint study warned. “If such disruptions occur, the economic impact would be significant and widespread.”

According to the study:

A 5-day stoppage would:

  • Reduce GDP $1.9 billion a day;
  • Disrupt 73,000 jobs; and
  • Cost the average household $81 in purchasing power.

A 10-day stoppage would:

  • Reduce GDP $2.1 billion a day;
  • Disrupt 169,000 jobs; and
  • Cost the average household $170 in purchasing power.

A 20-day stoppage would:

  • Reduce GDP $2.5 billion a day;
  • Disrupt 405,000 jobs; and
  • Cost the average household $366 in purchasing power.

“It is important for the parties at the table as well as others to fully understand the economic consequences of a port disruption,” NRF president Matthew Shay said. “Any supply chain disruption, whether it’s a port slowdown or outright stoppage, would cripple international trade, stymie supply chains and hurt domestic employment and consumer spending. For retailers and their customers, a port closure would mean a delay in back-to-school and holiday shipments that could significantly drive up consumer prices.”

“Manufacturers depend on the ability of West Coast ports to efficiently move cargo valued at 12.5 percent of U.S. GDP,” NAM president and CEO Jay Timmons added. “A shutdown would erode that figure and inflict long-term damage to our competitiveness as manufacturers and as a nation. The parties must come to an agreement before the current contract expires.”

The last major US West Coast port disruption occurred in 2002. It lasted 10 days and was estimated to cost the US economy several billion dollars.

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