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US West Coast Port Update

Tentative Agreement Reached, Positive Impacts for our Customers and Region

February 23, 2015 Operators and union workers at the West Coast ports came to terms on a tentative, five-year contract Friday, February 21st and the ports were in full operational mode by Saturday. However, after months of contentious negotiation and the reality of work slowdowns, the 29 ports likely will take a while to clear out the significant cargo backlog.

“If we are to truly have modern international trade, supply chain and transportation systems, we must develop a better process for contract negotiations moving forward.”
– Matthew Shay, president and CEO of the National Retail

  • The negotiations impacted the operations of 29 U.S. West Coast ports, including all the major West Coast container ports — Los Angeles, Long Beach, Oakland, Portland, Seattle and Tacoma. It does not cover ports in Canada or those on the U.S. East and Gulf coasts, the main reason why shippers are seeking refuge at those ports.
  • Los Angeles and Long Beach, are the entry point for about 40% of all goods imported into the U.S.
  • Nearly 50% of all U.S. containerized freight is handled at West Coast ports. A lockout or strike would cost the U.S. economy $1 billion per day, according to some estimates.
  • Key bone of contention is NOT wages (longshoremen are already among the highest paid blue-collar workers). But jurisdiction over cassis maintenance and repair and work rules in the face of automated handling.
  • Also, the union is seeking a 3-year contract this time; 6 year has been the norm since 2002 and preferred by industry for lengthier assurance of labor peace. (and Obamacare tax on healthcare takes effect in 2018)

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