NRF: West Coast Port Shutdown Could Cost $2 Billion a Day
The National Retail Federation says import volume will rise 10.1 percent this month (vs. last year) as the contract battle between the Pacific Maritime Association and the International Longshore and Warehouse Union continues on the 29 West Coast Ports. The contract expired last July and the threat of a shutdown has been persistent.
“With cargo volume growing as the economy continues to recover, the last thing we need is a port shutdown that would bring billions of dollars of economic activity to a halt,” said the NRF’s VP for Supply Chain and Customs Policy Jonathan Gold. “Whether it’s in retail, manufacturing, agriculture or other industries, there are too many jobs that rely on the ports to let that happen. Labor and management need to do whatever it takes to reach an agreement and do it today.”
Contract negotiations actually began last spring, but little visible progress has been made while the ports become more congested. A mediator was brought in on January 6.
“It’s starting to have an effect,” said NRF CEO Matthew Shay during an interview (see below) on CNBC’s Squawk Box. “Port operators are saying it’s close to catastrophic and last time they said that, there was a shutdown for 10 days in 2002—that cost the economy a billion dollars a day. Our study estimates that if that happened today it would be $2.5 billion every day.”
