Port workers, employers finally reach tentative agreement

After an embattled nine months of ongoing talks between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU), the two sides have finally come to an agreement, paving the way for a cessation of port slowdowns that hit the retail industry hard.

Representatives for the PMA and ILWU indicated that on Feb. 20, talks helped produce a tentative agreement that will allow the West Coast’s 29 ports to resume normal operations.

James McKenna, president of the PMA, and ILWU president Bob McEllrath issued a joint statement announcing the five-year deal.

“We are pleased to have reached an agreement that is good for workers and for the industry,” the joint statement said. “We are also pleased that our ports can now resume full operations.”

The contract dispute stalemate encouraged other outside parties to join the talks to see if a settlement could be reached. For instance, in mid-February, Labor Department secretary Tom Perez announced that he would reach out to both sides in an effort to find common ground and restore activity at the more than two dozen ports that line the nation’s West Coast.

Though both the PMA and ILWU have pointed out that there has never been a full stop to exporting and importing activity at the 29 ports, traffic slowed down considerably and caused massive delays for small and large retailers. Last year, the National Association of Manufacturers (NAM) produced a study, which detailed how tens of thousands of jobs would be lost the longer the work stoppage lasted.

“A widespread interruption of this magnitude would negatively affect economic activity and jobs through three main channels: export loss, import delay and higher costs, and reduced purchasing power for consumers,” the NAR report stated. “First, export loss would directly lessen output and employment of exporting industries, and the loss would indirectly reduce activity in their supply chains.”

It added that interruption and delays would also reduce gross domestic product and employment growth by “throwing sand in the gears of productive activities.”

NRF called on Washington to step in

The deal comes as welcome news to the National Retail Federation (NRF). In the hours before the agreement was reached, the NRF released a statement, imploring all parties to do what’s best for business. Jonathan Gold, vice president for the NRF’s supply chain and customs policy division, said that if an agreement wasn’t reached by Feb. 20, the labor dispute ought to be the first item of business for lawmakers on Capitol Hill.

“If a deal is not reached today, we support the decision to move the negotiations to Washington and we call upon the president to personally engage in the discussions until an agreement is reached,” said Gold.

NRF president and CEO Matthew Shay congratulated both the ILWU and PMA for reaching an accord on the labor talks, adding that both parties should now move quickly to ratify the deal so that the backlog at the ports can be alleviated and things can get back to normal swiftly.

“The agricultural, manufacturing, retailing and transportation industries have all suffered due to the nine-month long contract negotiations,” said Shay. “As we welcome today’s news, we must dedicate ourselves to finding a new way to ensure that this nightmare scenario is not repeated again.”