Louisiana Ports Impacted by Labor Strike, and Economic Impacts Could Follow

BATON ROUGE, La. (KPEL News) - As of Tuesday, a major labor strike at ports from the East Coast down to the Gulf Coast has started and could have considerable economic impact on Louisiana.

A dockworkers' strike means it's considerably tougher for imported goods to make it into America's heartland. Subsequently, we can see the price of certain goods, including essential ones, go up.

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The International Longshoremen’s Association (ILA) was in negotiations with a group representing ports along the East and Gulf Coasts, the United States Maritime Alliance (USMX). But those talks broke down over the summer. A last-ditch effort to move the talks along was made Monday evening, but no settlement could be reached.

There are two key issues at play. The first is over pay, where dockworkers wanted a 77 percent pay increase spread over six years to help workers cope with rising inflation. They also wanted an agreement to prevent full automation from taking over crane operations at the ports.

ILA President Harold Daggett said the union is “prepared to fight as long as necessary," indicating this could be a long fight.

Impact on Louisiana's Ports

According to the Louisiana Association of Business and Industry (LABI), the strike directly impacts two major ports in Louisiana - Baton Rouge and New Orleans.

LABI called the strike "disheartening."

“Today’s strike by members of the International Longshoremen’s Association is disheartening and troublesome, especially for Louisiana, as we are a state with a considerable role in the nation’s distribution of exports, having exported nearly $53 billion worth of goods in 2023—everything from coffee to chemical products. The Port of Baton Rouge and the Port of New Orleans—critical domestic and international trade stops—are impacted.

“Beyond the financial blow of this strike, it will hamstring an already fragile supply chain that is still recovering from the pandemic. Despite precedent and the legal means to do so, the Biden Administration’s refusal to intervene in contract negotiations is also deeply frustrating. Intervention would have prevented interruption at the 14 ports involved while discussions between the parties continued. The very scenario we find ourselves in could have been avoided with action by the president.

“While a work stoppage at any time is unacceptable, this strike just before the holidays could be a disaster for Louisiana’s businesses, manufacturers, and consumers.”

Economic Impact

The short version? A lot of experts are concerned about inflation and how the strike can force prices to go up.

“Every idle day that a ship does not get into the port costs money and sometimes a lot of money," said Stamatis Tsantanis, chairman and chief executive of shipper Seanergy Maritime and United Maritime, in a statement. "That ultimately gets passed onto consumers."

The kind of resulting inflation that would result could last for months.

The Biden administration, which has been sensitive to issues regarding inflation, has said it won't directly interfere in the negotiations. However, it is strongly encouraging talks continue.