In the month of May, the number of shipping containers arriving at the port of Los Angeles is expected to be down by 25% over the same period last year. Los Angeles’ port is the country’s largest, in the volume of shipping containers, and half of the berths for the container ships are presently empty. One in nine jobs, or about 1 million workers in the five counties around Los Angeles, is tied to the port, including freight forwarders, brokers, warehouse workers, truck drivers and dockworkers. About 20% of the ships that were expected to arrive this month have already cancelled, and that figure is anticipated to rise. Consumer spending accounts for 70% of the U.S. economy, and industry leaders warn that those consumers could see empty store shelves within 60 to 90 days.
Vice President Bradi Good of Local 13 of the International Longshoremen and Warehouse Union told the Washington Post: “Under the union contract, full-time dock workers are guaranteed some pay even when there is no work. But some now are working fewer shifts or (at) lower-paying jobs than they normally perform.” These workers usually take advantage of slow periods by repairing or maintaining equipment, but this time there is much more uncertainty. Sal DiCostanzo, the union’s port liaison, said that, instead of showing sympathy for workers hurt by the trade war, President Trump has said that the trade war is “a good thing, not a bad thing,” since it means less “unfair” trade with China. Despite the trade war with the U.S., however, China’s exports rose by 8% in April, with increased shipments to Europe, Southeast Asia and Africa.
Competition in the trucking industry has become fierce, as freight rates are at the level they were a decade ago. Many small trucking companies have filed for bankruptcy, and the larger firms have seen their stock values drop by 20%. Trucking companies have laid off drivers, cancelled new truck orders, and even outsourced jobs to competing companies.
