The American Apparel & Footwear Association (AAFA) is calling on President Joe Biden to get East Coast and Gulf Coast port dockworkers and their employers back to the negotiating table.
In a letter to President Biden Tuesday, the association of more than 1,000 apparel and footwear brands urged the administration to “immediately engage” with the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) to restart their talks, which have been on ice since the fall.
The ILA, which is negotiating a new master contract for roughly 45,000 of its 70,000 members, has held firm that these dockworkers will go on strike in October if a new deal is not reached by the expiration date of Sept. 30.
The union says master contract negotiations will not resume until local negotiations are completed. In February, the ILA gave local unions a May 17 deadline to complete the bargaining talks at individual ports. According to the union, the Ports of New York & New Jersey and Baltimore have reached local agreements.
A strike, or other disruption, would be impactful for the apparel and footwear industries. More than half of products come through the 36 ports stretching along the coastline of Maine to Texas.
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“The vast majority of footwear and apparel products are imported into the U.S. In 2023, the East and Gulf Coast ports accounted for 53 percent of all U.S. apparel, footwear and accessories imports, amounting to over $92 billion in value,” said Stephen Lamar, president and CEO of the AAFA, in the letter. “A coast-wide strike would increase the price of goods, damage the reliability of East Coast ports, and spark a new round of inflation in the U.S economy.”
Citing that such a work stoppage or slowdown could have a devastating impact on American consumers and workers and the U.S. economy, Lamar acknowledged some of the other current top-of-mind concerns for stakeholders in the apparel supply chain—namely the Red Sea crisis and the drought impacting the Panama Canal.
The East and Gulf Coast ports have already seen some impact from these changes, according to monthly McCown Report, which analyzes the country’s top 10 ports on import performance. For the three months ending January, West Coast ports saw a 19.3 percent increase in 20-foot equivalent units (TEUs) handled, while East and Gulf Coast ports saw a 0.4 percent decline.
“Our members are facing unforeseen transportation challenges, in the dangerous Red Sea from terrorist attacks, and in the shallow Panama Canal from climate conditions,” Lamar said. “The addition of a disruption to service in East Coast and Gulf Coast ports would exacerbate delays, further raising the cost of apparel, footwear and accessories and thousands of other products for hardworking American families, sparking new inflation fears.”
In particular, the AAFA also has concerns about trade with countries in Central America, much of which comes through the East and Gulf Coast ports. According to Lamar, any disruption could be “putting at risk the work we are doing in concert with” the Partnership for Central America, a public-private partnership plan designed to strengthen the region’s economic security.
As part of the plan, organizations like Target and Columbia Sportswear have committed more than $4.2 billion in investment in the region as of February 2023. The plan, first unveiled by Vice President Kamala Harris in 2021, also includes initiatives built to encourage nearshoring and strengthen sourcing and manufacturing partnerships across countries including Honduras, Guatemala and El Salvador.
Lamar called a disruption “preventable” if the Biden administration commences immediate engagement with both parties. The administration already intervened in previous potential strike activity to close out 2022, with Biden signing a bipartisan bill to end a three-year collective bargaining process.
And last summer, ongoing contract negotiations at the West Coast ports were resolved after acting Secretary of Labor Julie Su held joint meetings between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU), resulting in a new six-year deal.
“We have applauded your administration’s successful efforts to resolve the rail workers’ and West Coast port workers’ contracts,” Lamar said. “We see an opportunity here for you to continue to build on this legacy of leadership on labor rights and transportation.”
The letter comes two months after another major trade association, the National Retail Federation (NRF), sent letters to both the ILA and USMX urging they restart negotiations.