Ahead of the long-awaited contractual negotiations between dock workers and employers on the west coast of the United States, a verbal confrontation over automation is already underway, an issue over which the two sides are at loggerheads.
With the current contract expiring on June 30, the International Longshore and Warehouse Union (ILWU), which represents nearly 14,000 dock workers in California, Oregon and Washington State, and the Pacific Maritime Association (PMA) on behalf of shipping companies and terminal operators in 29 west coast ports will begin formal negotiations on May 12 in San Francisco.
In an opening salvo, PMA published a commissioned study extolling the benefits of terminal automation.
The authors found that the volume of containers per acre at the two automated terminals of the Los Angeles-Long Beach port complex was 44% higher than the 11 non-automated boxes of the sister ports. Since 2019, automated terminals have processed boxes twice as fast as traditional ones, they wrote.
Through the use of autonomous vehicles and cranes that stack boxes higher and higher, capacity has increased, the study points out. PMA considers automation a fundamental tool for addressing capacity constraints. PMA CEO Jim McKenna called it the “key to long-term survival and long-term competitiveness.”
According to the study, automation benefits work equally.
The authors found that between 2015, the last year before the move to automated operations, and 2021, ILWU’s paid hours at the two automated terminals increased by 31.5%, more than double the growth rate of the 13.9% in non-automated terminals. They added that the ILWU registered workforce at the port complex grew 11.2%, compared to 8.4% growth in the other 27 West Coast ports.
“Contrary to ILWU concerns, automation in San Pedro Bay ports has added work, not at its expense. Increased flow of goods will create port-related jobs and add jobs across the supply chain. On the contrary, the lack of adaptation threatens to carry goods to other ports, with a cascading loss of jobs on the docks and throughout the regional economy “, they concluded.
Predictably, the ILWU rejected the PMA-funded study as self-service. For his part, he argued that automation had led to the loss of hundreds of jobs in ports.
“The increased productivity that PMA is claiming at the two automated terminals has meant less work in other terminals and an overall loss of work for the mainland workers. We have not seen a general increase in productivity in ports, just a shell game to mask the human cost of job destruction, ”the union commented.
This exchange is unlikely to calm the nerves of the owners of goods whose traffic moves through West Coast ports. The latest round of contract negotiations saw four months of disruptions due to the slowdown in work in various ports along the coast.
So far both the PMA and the ILWU have refrained from conflicting statements, let alone moves. Over the past two years they have shown a collaborative spirit in addressing the challenges of Covid-related outages and congestion issues.
There appears to be a broad consensus between traders and customers that this round of negotiations will not produce any significant disruption. A freight forwarder executive commented that both sides are facing intense pressure to come to a quick resolution: the Washington administration leans on the union, while employers are expected to face significant financial impact from a long standoff, he said. .
Three weeks ago, ILWU leaders dismissed fears of a destructive confrontation. “We have been doing this for over 85 years and we will sit down, we will get a deal,” said ILWU International President Willie Adams.
Mario Cordero, executive director of the Port of Long Beach, downplayed the automation debate. According to him, the lack of automation is not a major obstacle to achieving the required levels of efficiency. Instead, he described limited working hours as the main obstacle, calling for 24/7 operations to handle the high volumes of cargo that poured in from Asia.
While there is still widespread optimism that contractual negotiations can avoid serious confrontations, importers and their freight forwarders are in no danger. Several freight forwarders told the Loadstar who have shifted part of their imports from Asia to ports on the east coast or the Gulf region of the United States.