West Coast port slowdown threatens marketers

The showdown between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union could spell big problems for catalogers and other marketers importing merchandise from Asia.

The union’s contract with PMA, which represents the operators of docks and terminals along the western sea coast, expired at 5 p.m. on July 1. The deadline was then extended another 24 hours and could be extended again, so long as talks continue. Then again, talks could break off at any time, or the union could stage rolling slowdowns. The PMA has said that it would respond to any slowdowns by locking out the longshoremen.

Nearly all the merchandise coming into this country passes through the West Coast ports, according to Eric Autor, vice president/international trade counsel for the National Retail Federation. So any labor disruption or prolonged shutdown would delay the arrival of fall merchandise to marketers. Autor estimates that a strike, shutdown, or lockout would cost the U.S. economy $1 billion a day.

And according to a study by Dr. Stephen Cohen, professor of regional planning at the University of California at Berkeley, a shutdown of West Coast docks could even trigger a crisis in international financial markets. He estimates that a five-day shutdown would cost the national economy $4.7 billion and reduce federal, state, and local tax receipts by $115 million.

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