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- Around 45,000 dockworkers are on strike, shutting down East and Gulf Coast ports.
- The damage wreaked on the supply chain by Hurricane Helene may give dockworkers the upper hand.
- President Biden on Tuesday called for port companies to offer fair deals to striking dockworkers.
The devastation wreaked by Hurricane Helene may be giving 45,000 striking dockworkers a major advantage in their negotiations.
The strike, the first of its kind since 1977, shut down ports on the East and Gulf Coasts. It is expected to put a $5 billion dent in the economy per day, according to analysts from JPMorgan.
Alan Murphy, the CEO of the liner research firm Sea-Intelligence, estimates the US could tip into recession if the port strike lasts longer than a month.
It comes during the peak shipping season for holiday goods and at a time when Hurricane Helene's impact is also disrupting the economy and supply chain.
Helene, which made landfall in Florida on Thursday, has ravaged six south-eastern states. More than 150 people have died and hundreds more are still missing.
In a Monday report, Moody's Analytics projected the damage from the hurricane to be between $20 billion and $34 billion, per Investor's Business Daily. Weather forecaster AccuWeather projected a much larger number, as high as $160 billion in damage from the storm.
A double hit
Jon Davis, the chief meteorologist at Everstream Analytics, which focuses on supply-chain risk, this week told Business Insider's Tim Paradis that the storm and the strike would have massive "compounding effects."
"It's not one plus one equals two," he said. "One plus one equals a lot more than that."
The strike could severely impact the shipping of consumer products like beer, wine, liquor, fruits, and toys.
Three experts told BI that with less than two months until Black Friday, the likelihood that the strike could impact holiday shopping was high.
Any slowdown in the US's critical supply chains could also fan inflation.
William Brucher, an assistant professor of labor studies and employment relations at Rutgers University, told Associated Press. that "this is a very opportune time" for striking workers.
"I think this work group has a lot of bargaining power," said Harry Katz, a professor of collective bargaining at Cornell University, according to AP. "They're essential workers that can't be replaced, and also the ports are doing well."
Pressure mounts on Biden
Although the strike has only lasted a day so far, the pressure is clearly mounting on the Biden administration on what could be a key issue in the upcoming election.
According to the AP, the International Association of Longshoremen wants a 77% increase in pay over the course of a six-year contract and limits on port automation.
In a Tuesday post on X, Biden pushed for ocean carrier companies to offer "a strong and fair contract" that reflects workers' contribution to the economy since the pandemic and to these companies' record profits.
The US Maritime Alliance, representing the ports, offered employees a 50% wage increase over six years, but the ILA has remained firm on its demands.