Will Another Dock Workers Strike Affect the Economy and Your Wallet? | Global News Avenue

Another U.S. port worker strike looms, with consequences The price may be higher and slowing economic growth.

Last year, striking workers forced Temporary suspension of operations Some analysts worry about the impact of the outbreak at Eastern and Gulf Coast ports on the U.S. economy. Now, as labor contract negotiations continue, economists are again bracing for a potential port strike that could slow supply chain Everything from cars to coffee.

American Maritime Union and International Longshoremen’s Association union Contract negotiations will reportedly resume on Tuesday, January 7. Dockers and operators Agree to raise salary In October, a brief strike was temporarily suspended.

The problem still exists Deadline January 15 Sign a new contract. Negotiations are currently focusing on the use of semi-automatic cranes at the port, and failure to reach an agreement could lead to another port worker strike as soon as next week.

Prolonged strikes could weigh on economic growth

BMO senior economist Sal Guatieri wrote that while the U.S. economy was not severely disrupted by October’s three-day strike, a longer shutdown would have a larger impact, especially on the prices people pay in stores.

“A longer strike would disrupt trade more severely and impact supply chains for U.S. manufacturers and retailers,” Guatieri wrote. “Some ships may be rerouted to West Coast ports, but costs will increase. Shipment delays and freight increases will be largely passed on to consumers, adding to inflation, including in food costs.”

In addition to exacerbating inflation, another worker strike could affect U.S. gross domestic product.

Worker shutdowns at Eastern and Gulf Coast ports could cost $500 million to $5 billion a day, according to various economic estimates.

Guatieri calculated, based on a median estimate, that a week of strikes could reduce U.S. first-quarter GDP by 0.1 percentage point. Guatieri wrote that if the strike were extended to the full quarter, GDP could fall by a full percentage point, halving BMO’s forecast for 2% growth in the current quarter.