WASHINGTON: The US economy could lose $2bn a day in economic activity during a work stoppage at west coast ports, retailers have warned as an impasse in contract negotiations threatens a lockout by employers within days.
Jonathan Gold, head of supply chain for the National Retail Federation, based the warning on a study the federation commissioned last year examining how a complete stoppage would affect US gross domestic product. The study found a five-day lockout would reduce GDP by $1.9bn daily, a 10-day lockout by $2.1bn a day and 20 days $2.5bn daily.
Mr Gold was speaking after the Pacific Maritime Association, representing employers, presented what it called its “all-in” offer to the International Longshore and Warehouse Union after nine months of contract talks.
The PMA made it clear that the disruption from go-slows by the union was growing so severe it would impose a lockout on workers within five to 10 days if the offer was not accepted. The last lockout at the ports in California, Oregon and Washington lasted 10 days and disrupted supply chains for six months afterwards.
The NRF has said its members have already been starved of supplies or forced to switch to expensive alternatives such as airfreight over recent months as worsening labour relations at west coast ports has slowed operations.
The congestion at the neighbouring ports of Los Angeles and Long Beach which alone handle 40 per cent of US container traffic was so severe on Thursday that 18 container ships were waiting offshore to load and unload. There would normally be only one or two, according to the Port of Long Beach.
Retailers hoped that the final deal would be accepted and the ports would return to normal, Mr Gold said. He warned, however, of the likely impact if a full shutdown ensued.
