On October 1, 2024, ports up and down the Eastern and Gulf coasts saw thousands of dockworkers begin a long-anticipated strike. Members of the International Longshoremen’s Association (ILA), the union representing the dockworkers, rallied together in an effort to raise wages and ban automation in ports.
To many Americans’ relief, the strike lasted only three days until a temporary agreement was reached, NPR reported. The ILA and United States Maritime Alliance (USMX), the company representing port employers and container carriers, negotiated a wage increase of 62% over six years. Talks about a port automation ban have been pushed back to Jan. 15, 2025, creating the looming possibility of another strike after the New Year.
According to CBS news, politicians and economists worried about the possible consequences of extended port closures at the start of the strike.
Severe supply chain shortages could ensue if the ILA and USMX failed to come to an agreement. Not wanting to repeat the coronavirus pandemic’s supply chain struggles, retailers scrambled to stock up on necessary items before the strike began, the Wall Street Journal reported.
President Joe Biden congratulated both the ILA and the USMX on reaching a speedy, if tentative, agreement. The Associated Press quoted Biden praising both organizations “for acting patriotically to reopen our ports and ensure the availability of critical supplies for Hurricane Helene recovery and rebuilding.”
Other public officials remain concerned about the potential economic impact of the strike continuing in January.
“Indiana is the Crossroads of America, and Hoosiers depend on the uninterrupted import and export of goods from our nation’s ports,” Indiana Senator Todd Young said. “While the recent strike at our East and Gulf Coast ports only lasted three days, that is three days too many. I urge both sides to make every effort to reach a longer-term agreement by January 15 in order to avoid further impact on our economy.”
Alice Tsang, professor of finance at Taylor’s Cornwall School of Business, said that the immediate economic impact was minimal. However, the strike and its temporary conclusion could still influence the American economy.
Buyers should expect more price hikes in the future, Tsang said. The dockworkers’ increasing wages will mean a higher cost of doing business for the shipping companies. Needing to maintain the same level of profit, the shipping companies will pass that extra cost downstream to businesses who will then raise prices for consumers.
Raising the cost of business production will also increase inflation, Tsang said. And the success of the dockworkers strike could cause a ripple effect, encouraging other unions in other sectors to strike as well.
“So definitely the economy will be impacted,” she said. “And not in a positive way from the standpoint of the consumers.”
While the coastal dockworkers strike may seem far from Upland’s cornfields, Tsang believes there is a connection to Taylor students and their daily lives.
Financially, she suggests students be careful to spend within their control, not buying a lot of nonessential items.
To keep themselves afloat in the rising tide of inflation, she advised students to increase their earning power and potential.
“(Students) need to prioritize how best to spend their time at Taylor to better prepare themselves so that their earning power will always outpace their cost of living,” she said.
Tsang encouraged Taylor students of every major to take classes that will broaden their skill sets and make them competitive candidates for internships and jobs. Then as the costs of living rise, students’ earning power will be able to keep up.
Instead of feeling overwhelmed or anxious about these economic realities, Tsang hopes students will become educated and feel empowered.
“Why (should they) feel empowered?” Tsang said. “Because they are in a good place to prepare themselves to bring their earning power to a level that will protect them from increasing costs of living.”
