The union dockworkers strike that began early Tuesday has caused disruptions at dozens of U.S. ports, prompting shipping giant FedEx to implement contingency plans to minimize shipment disruptions. A FedEx spokesperson stated that their priority is to maintain excellent service for customers and provide support during this situation.
The strike, initiated by unionized dockworkers at 36 East and Gulf Coast ports, comes after negotiations over a new contract with port employers reached an impasse. The International Longshoremen's Association (ILA), representing 45,000 dockworkers, began their first strike since 1977 after their contract with the U.S. Maritime Alliance expired.
Negotiations have stalled over the union's demands for wage hikes, compensation, and protection from automation at ports. The impact of the strike extends to U.S. seaports from Maine to Texas, which handle approximately half of U.S. imports and are crucial for American exports.
The strike is expected to affect imports of cars, auto parts, agricultural products, machinery, steel, furniture, apparel, and more. East and Gulf Coast ports also handle significant percentages of exported cars, pharmaceuticals, meat, eggs, wood, plastics, and other commodities.
JPMorgan estimates that a port strike by East and Gulf Coast workers could cost the U.S. economy between $3.8 billion and $4.5 billion per day. However, the Anderson Economic Group (AEG) predicts a lower total cost of $2.1 billion for the first week of the strike.
Patrick Anderson, CEO of AEG, believes that the Biden administration's intervention will likely determine the duration of the strike. As negotiations continue, the impact of the strike on the economy and the shipping industry remains uncertain. FOX Business' Eric Revell contributed to this report.