East Cost Longshoremen Strike Apparently Averted As Union And Terminal Operators, Shippers Reach Tentative Pact

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February 3, 2013 1:18 AM EST

Union negotiators for dockworkers on the U.S. East and Gulf Coasts and negotiators for port operators and maritime shippers have reached a tentative labor pact that will avert a potentially devastating economic blow to the U.S. economic recovery.

Federal mediator George Cohen said late Friday that both sides, the International Longshoremen's Association, AFL-CIO (ILA), and the U.S. Maritime Alliance, agreed on terms of a “master contract,” an umbrella agreement that governs labor relations in all 15 major ports from Maine to Texas. These ports handle about 35 percent of U.S. imports.

It was further agreed that there will be no work stoppage as negotiators hammer out local agreements, pacts specific to each port.

The news comes as a huge relief to U.S. retailers who have worried that a strike by the International Longshoremen's Association, AFL-CIO, which represents about 14,500 workers, would cost more than $1 billion per day.

Negotiators were operating under a Wednesday deadline to avoid what would have been the first longshoremen's strike in 35 years.

"I am extremely pleased to announce that the parties have reached a tentative agreement for a comprehensive successor Master Agreement,” Cohen said. “The tentative agreement is subject to the ratification procedures of both parties and, as well, to agreements being achieved in a number of local union negotiations. Those local negotiations are ongoing and will continue without interruption to any port operation.”

A strike would have hit the New York-New Jersey area particularly hard. About 3,250 longshoremen load and unload boats on ports in the area. Port activity directly supports nearly 200,000 jobs in the New York area alone. A one-week dockworkers strike would cost the region an esimated $110 million in economic output and $136 millino in personal income. Even without sympathy strikes by dockworkers in other ports, a New York area job action would have cost the U.S. $1 billion to $2 billion per day in economic activity.

Moreover, a strike would have hammered the nation's fragile economic recovery because consumers, who constitute about 70 percent of the U.S. economy, would have to absorb the extra cost of goods as a result of higher transportation charges.

Besides the Port of New York and New Jersey, the ports involved in the contract negotiations are Hampton Roads, Va., Houston, Savannah, Ga., Boston, Delaware River, Baltimore, Wilmington, N.C., Charleston, S.C., Jacksonville, Fla., Port Everglades, Fla., Miami, Tampa, Fla., Mobile, Ala., and New Orleans.

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