Even though East and Gulf Coast longshoremen agreed to return to work Thursday evening, their three-day strike at the port in Wilmington could have a ripple of negative effects on the North Carolina economy, potentially hampering recovery efforts in Western counties.
Lumber products and other construction materials, essential to rebuilding efforts after Tropical Storm Helene’s devastating flooding and landslides, enter the state via the Wilmington port.
“It’s not like the strike ends and then the flow of goods immediately starts back up,” Drew Rosen, professor of supply chain management at University of North Carolina Wilmington, told Carolina Public Press. “It takes time for the gears to get in motion.”
Rosen predicts that it will take five weeks before supply chains are fully back to normal.
“We’ve got catastrophic flooding in the western part of the state,” he said.
“Every bit of lumber, every bit of building material will be sent there. Now, that process will be hindered, as construction materials are slowed down coming in through the port.”
Wilmington is the 21st largest port in the country, but is normally regarded as one of the most efficient. Rosen hopes that this efficiency — that more trucks come in and out, loading and unloading, than in ports of comparable size — will mitigate the delays in materials getting out to Western North Carolina.
“There are certainly ongoing conversations about how to bypass or potentially minimize the effect of the strike on Western North Carolina,” said regional economist Mouchine Guettabi of UNCW.
Robert Handfield, supply chain management professor at N.C. State University, told CPP that the strike caused a lot of shipments to be rerouted around to the West Coast, and then put on a truck to traverse the county on interstates.
With food availability already a concern at the top of many minds in counties affected by Tropical Storm Helene, empty store shelves are not a heartening sight.
Both Rosen and Guettabi say the country has learned from the pandemic-era crash course in supply chain failures, so catastrophic shortages are less likely. The chain of supply is more limber than it once was.
“I want to thank the union workers, the carriers, and the port operators for acting patriotically to reopen our ports and ensure the availability of critical supplies for Hurricane Helene recovery and rebuilding,” President Joe Biden wrote in a Thursday night statement.
Economic effect of port strike
The port of Wilmington contributes close to $16 billion to the state economy, with 90,000 jobs connected to its operations, according to Guettabi.
“Because the southeast region has grown quite a bit over the last four or five years, population growth has translated into the footprint of the port becoming more pronounced,” Guettabi said.
“It plays a more outsized role in the state economy than it did pre-pandemic.”
Guettabi described the tentacle-like significance of the port to Wilmington and the state at large.
“Proximity to the port means more dependence on it,” Guettabi said.
“You’re affected by the flow of goods and services, what is and isn’t on grocery store shelves, but you also have a group of people whose work depends on the port. You have businesses that are strategically located near the port.”
All in all, the strike is estimated to have cost the US economy up to $15 billion.
“For the state alone, economists say we're going to be losing $650 to $700 million in state and local taxes for all the products that would've been coming off those ships,” Rosen said.
Union members in Wilmington hit the streets on Tuesday with signs reading “Profit over people is unacceptable,” “Automation hurts families,” and “No work without a fair contract.”
“Everybody deserves a fair wage,” Rosen said. “Being a dock worker is dangerous and strenuous. They’re out there every day, working in inclement weather.”
The contract between the International Longshoremen's Association and the United States Maritime Alliance has been extended to Jan. 15, and promises a 63% pay increase for port workers over a six-year period.
However, the port ownership has yet to quell the union’s concerns that they may lose their jobs to automation in years to come.
This article first appeared on Carolina Public Press and is republished here under a Creative Commons license.
