business

A Looming East Coast Port Strike Could Shake the Economy

With dockworkers on the East and Gulf Coasts threatening to strike on Oct. 1, businesses have been accelerating imports, redirecting cargo and pleading with the Biden administration to prevent a walkout.

Some importers started ordering Christmas goods four months earlier than usual to get them through the ports before a labor contract between the operators of port terminals and the International Longshoremen’s Association expires next Monday.

Many shipments have been diverted to West Coast ports, where dockworkers belong to a different union that agreed a new contract last year. The ports of Long Beach and Los Angeles say they are handling at least as many containers as they did during the pandemic shipping boom of 2021-22.

Despite those measures — and all the problem-solving skills that supply chain managers developed during the turbulence of recent years — a short strike could lead to significant disruptions. JPMorgan transportation analysts estimate that a strike could cost the economy $5 billion a day, or about 6 percent of gross domestic product, expressed daily. For each day the ports are shut down, the analysts said, it would take roughly six days to clear the backlog.

Chris Butler, the chief executive of the National Tree Company, which sells artificial Christmas trees and other decorations, said his company had brought in goods early and made greater use of West Coast ports. But he estimated that 15 percent of his goods would still be stranded by a port strike.

“I’m very unhappy,” said Mr. Butler, who is based in northern New Jersey. “We’re doing everything we can to mitigate it. But there’s only so much you can do when you’re at the mercy of these ports.”

Just over half of imported apparel, footwear and accessories come through East Coast ports, according to Stephen Lamar, the president of the American Apparel and Footwear Association. While his industry has made significant preparations for a strike, he said, “with logistics we should never be surprised when last-minute hurdles come along.”

Last week, scores of trade groups sent a letter to the Biden administration, imploring it to help forge a deal between the I.L.A. and the United States Maritime Alliance, a group of companies that move cargo at ports.A woman behind a large stack of cardboard boxes with a lit Christmas tree in the foreground.

The alliance said on Monday that it had been unable to schedule a meeting with the I.L.A., adding that it had been contacted by the Federal Mediation and Conciliation Service, a government agency that helps management and unions negotiate labor contracts.

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