Port strikes can disrupt supply chains, create backlogs, reduce industrial output and threaten jobs, the Brookings Institution explains. However, determining the exact financial cost of such industrial action is notoriously difficult and is the reason why experts differ widely when estimating the cost of port strikes, explains the Washington Post.Continue Reading
A 2015 contract dispute involving dockworkers and shipping companies in 29 West Coast ports delayed trucks, forced railroads to reroute shipments and lessened manufacturing output, the Brookings Institution explains. The port dispute may disrupt up to 73,000 jobs and eventually temper economic growth in several metropolitan areas across the United States. Experts placed the financial cost of the dispute at $2 billion a day.
Similarly, business organizations pegged the financial cost of the 11-day 2002 West Coast ports strike at $1 billion a day, the Washington Post explains. A November 2012 strike by clerical workers at the Los Angeles and Long Beach ports also cost $1 billion a day, according to OPS Rules Management Consultants.
The consequences of port strikes can spill across international borders, Seeking Alpha reports. For instance, the 2015 West Coast port dispute curtailed ConAgra's ability to supply potatoes to McDonald's, forcing the iconic fast food chain to ration fries in Japan. Even after resolution, the effects of such disruptions can persist for months as backlogs are cleared and normal supply chains are restored.Learn more about Economics