Port Strike Looms as Dockworkers Threaten Strike Over AI Automation, Pay Disputes

The ILA is pushing for fair pay AI automation, rejecting a wage deal that doesn't address their concerns.

By Thea Felicity

Jan 06 2025, 08:45 AM EST

US-LOGISTICS-TRADE-STRIKE-PORT — Dockworkers strike at the Bayport Container Terminal in Seabrook, Texas, on October 1, 2024. Officials at 14 ports along the US East and Gulf Coasts were making last-minute preparations on September 30 for a likely labor strike that could drag on the US economy just ahead of a presidential election -- despite last-minute talks. MARK FELIX/AFP via Getty Images

The International Longshoremen's Association is preparing for a January 15 strike in case its disputes with port operators are not settled. The association has 50,000 members and is upset about the automation of ports, which they feel is reducing the demand for new recruits.

A strike could shut down major US container ports from Maine to Texas, causing massive economic consequences. The union is demanding better pay and benefits, saying that it should receive more pay based on the value that it contributes to U.S. maritime companies.

The controversy over worker compensation has been rekindled by the astronomical increase in CEO pay over the years, Yahoo Finance reported. UnitedHealth Group is one of those companies whose CEOs have seen their pay skyrocket, with some packages totaling hundreds of millions of dollars in stock options and bonuses. In contrast, worker compensation has been flat. Typical wages have increased only 24% since 1978, while CEO compensation has increased an astronomical 1,085%. Workers are using this gap to justify their demands for higher pay.

The ILA also points to the windfall profits companies earned during the pandemic. For instance, container shipping lines saw profits soar as shipping rates skyrocketed, making executives and shareholders very rich. But workers argue that they should share in these gains, especially as automation continues to reduce their job security. The ILA's bargaining stance, using strategies similar to those of CEOs, reflects the growing frustration among workers over their relative compensation.

The ILA has rejected a six-year wage pact proposed by the US Maritime Alliance, which offers to boost wages over the term of an agreement by 61.5%. The alliance is seeking more automation at ports, and the push does not sit well with the workers. They want to be sure that productivity gains will be passed on fairly.

If the USMX does not listen to the workers' demands, a protracted work stoppage may occur, similar to previous cases, such as the Boeing mechanics' strike. Not only do such stoppages interfere with operations but also damage stock prices and corporate reputation. Workers are making a very clear statement that their contributions are just as vital to shareholder value as those of high-paid executives.