A costly dockworkers’ strike could ignite just days before President-elect Donald Trump takes office, presenting the Republican’s administration with a major domestic challenge on day one.
The International Longshoremen’s Association (ILA), which represents 47,000 workers, is planning to strike on Jan. 15 after a short three-day strike in October, where the union secured a 62% pay raise over six years from United States Maritime Alliance (USMX). However, negotiations concerning port automation with shipping companies continue to stall, and industry giant Maersk said there have been no new developments, according to Bloomberg Tuesday.
“The conditional agreement on wages is set to expire on January 15. If no agreement is reached by that date, a coast-wide strike on Jan. 16 is possible. However, the negotiations have had no new developments since our last communication,” Maersk said Tuesday in a customer advisory. “Considering the status, we strongly encourage our customers to pick up their laden containers and return empty containers at U.S. East and Gulf Coast ports before January 15. This proactive measure will help mitigate any potential disruptions at the terminals.”
The last strike in October, which lasted for only three days, was estimated to cost as much as $5 billion per day by JP Morgan. Brent Sadler, senior research fellow at the Heritage Foundation, told the Daily Caller News Foundation that a strike would hurt small businesses the most, although the effects may not be felt immediately.
“If you’re a small company and you’re waiting for bulk supply and materials to arrive in for your small or medium sized factory, you might have an economic impact that’s pretty severe, and I don’t think that’s good for anyone,” Sadler told the DCNF.
The strike is likely to happen, according to Sadler, and would certainly create backlogs on east coast ports. Negotiations between the ILA and shipping companies are set to resume Jan. 7, according to FreightWaves.
“What you very likely will see, at least in the East Coast ports, is a backlog of ships at anchor. A week backlog is going to take you probably two or three weeks clear,” Sadler told the DCNF. “So the shippers will then start to redirect their ships to other ports, like the West Coast, adding more economic cost.”
The ILA claims that the increase in automation will cost the industry jobs, and President Trump seems to agree.
“There has been a lot of discussion having to do with ‘automation on United States docks,” President Trump wrote on Truth Social Dec. 12. “I’ve studied automation and know just about everything there is to know about it. The amount of money saved is nowhere near the distress, hurt and harm it causes for American Workers, in this case, our Longshoremen. Foreign companies have made a fortune in the U.S. by giving them access to our markets. They shouldn’t be looking for every last penny knowing how many families are hurt.”
It is not immediately clear that automation will always net positive effects for port efficiency.
A 2021 International Transportation Forum study found no compelling relationship between port automation and efficiency. The U.S. Government Accountability Office, while finding some increase in efficiency, also found “mixed effects on the workforce, security, and performance,” according to a March 2024 study.
Chinese companies like China Ocean Shipping Company (COSCO) are part of the USMX, allowing them to hold leverage over negotiations to a degree. Experts previously told the DCNF that China’s potential involvement could present a national security risk.
Additionally, mysterious communications devices were found on cranes made by Chinese mega-manufacturer ZMPC, according to a congressional investigation in March. Beijing dismissed the U.S.’ concerns as “paranoia.”
Michael Watson, research director at the Capital Research Center, told the DCNF that unions, including the ILA, are playing around Trump’s populism to get better deals.
“You’d think the Republican administration coming in is going to align with independent work and away from organized labor, but Trump has put that into question,” Watson told the DCNF. “You know, some of these union bosses are starting to get a little smart about how they play their hands in the sort of more populist Republican era.”
Other unions have appeared to soften on Trump or outright voice support, such as the New York City Police Benevolent Association and the National Border Patrol Council. Most notably, The International Brotherhood of Teamsters declined to endorse a candidate in 2024 after polls showed the rank-and-file mostly supported him despite the union having a long history of Democratic endorsements.
Trump could curtail the impact of potential strikes by imitating what Margaret Thatcher did during her reign as Prime Minister in the United Kingdom with the coal mining unions: initially conceding to their demands, but stockpiling coal for later to minimize impacts of future strikes, Watson told the DCNF.
“They may have to give the Longshoremen more than they would like to give so that they can then prepare for the next and that’s assuming that they aren’t Biden-style stooges for the longshoremen, which I don’t know,” Watson told the DCNF. “The thing about Trump, because he’s so non-ideological as a figure, is that you can never be certain.”
The Trump transition team deferred to Trump’s Truth Social post, and the ILA did not respond to the DCNF’s request for comment.
This story originally was published by the Daily Caller News Foundation.
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