Situation Report (SITREP):
•After ending contract negotiations, the International Longshoremen’s Association (ILA), a dockworkers’ union, is likely to begin striking on October 1, 2024. The labor action will impact ports on the East and Gulf Coasts of the United States.
•A strike could cost the US economy $5 billion a day, or nearly 6% of the country’s gross domestic product. Additionally, for every day ports are inoperable it will take an estimated six days to clear the backlog.
•The work stoppage at major ports will likely exacerbate economic concerns, further increase prices, and lead to a shortage of specific imported goods.
◦The supply chain disruptions and work stoppage will increase the impact of the US’ current 2.53% inflation rate.
◦A shortage of goods, higher prices, and a poor economy could prompt an increase in criminal activity, to include crimes of desperation and necessity.
•Individuals and organizations, especially entities that depend on complex, foreign borne supply chains and imports, should prepare for a possible strike and review resiliency strategies.
Incident Overview:
In June 2024, the International Longshoremen’s Association (ILA), a dockworkers’ union, ended contract negotiations with the United States Maritime Alliance (USMA), a group of management companies. The breakdown in communication increased the likelihood of a strike at more than a dozen ports located on the Eastern and Gulf Coasts of the United States (US). Union members are growing increasingly concerned over ports’ use of equipment that can function without human operators decreasing the need for high-paying blue-collar jobs. With negotiations at a standstill a strike beginning October 1, 2024, seems eminent. The existing contract between the ILA and the USMA, which ends September 30, 2024, is unlikely to be renewed.
Impact Analysis and Recommended Action:
While organizations learned lessons regarding logistics and supply-chains during the global coronavirus pandemic, work stoppage at major ports will likely exacerbate economic concerns, further increase prices, and lead to a shortage of specific imported goods. Any strike – even a short labor union action – could prompt significant disruptions. According to transportation and financial analysts, a strike could cost the US economy $5 billion a day, or nearly 6% of the country’s gross domestic product. Additionally, for every day ports are inoperable it will take an estimated six days to clear the backlog. The supply chain disruptions and work stoppage will increase the impact of the country’s current 2.53% inflation rate. A shortage of goods, higher prices, and a poor economy could prompt an increase in criminal activity, to include crimes of desperation and necessity.
Individuals and organizations, especially entities that depend on complex, foreign borne supply chains and imports, should prepare for a possible strike and review resiliency strategies. In anticipation of a work stoppage, many importers have started ordering seasonal goods, such as winter and Christmas items, four months earlier than usual. Other importing companies have diverted shipments to West Coast ports, which are manned under a different union currently under contract. To find out how to mitigate the risks spawning from these strikes at Eastern and Gulf Coast ports, consider contacting RMS International’s security professionals at ask@rmsiusa.com to help you develop a customized and resilient plan to protect your organization, assets, personnel, operations and reputation.
About RMS International:
Founded in 2013, RMS International provides ad hoc and contracted close protection, estate security, international travel management, corporate executive protection, personnel and asset security, and discreet investigative services. Operating a state-of-the-art Risk Operations Center in West Palm Beach, they provide 24/7 overwatch of global operations in Asia, Europe, Africa and throughout the Americas. RMS International delivers peace of mind in a chaotic world. Visit us at RMSIUSA.com.
