“Tens of thousands of freight rail workers are prepared to go on strike on Friday at 12:01 am, which could have wide-ranging effects across the economy. It’s already causing some disruptions for rail passengers, freight companies, and others.
The cause is a dispute between the freight industry and the workers who make it run.
Most of the 12 unions representing the workers have already agreed to a proposal put together by a presidential emergency board established by the White House over the summer to try to help resolve the dispute. The proposal includes a 24 percent increase in wages for workers by 2024, but many workers have complained that it fails to address leave, on-call scheduling, and poor working conditions.
The holdout unions’ position is that pay increases aren’t enough to make up for some real downsides — and dangerous aspects — of the job.
The two most powerful unions involved in the negotiations, which represent engineers and conductors, are continuing to resist the proposal, putting both sides in a deadlock. If workers do go on the strike they appear to be hurtling toward, it would be the first such strike in 30 years.”
“If a freight strike were to occur — and especially if it’s long-lasting — it could have disastrous effects across an already fragile economy still reeling from supply chain disruptions and inflation.
“Rail moves a lot of the foundational, basic goods that we don’t think about day-to-day,” said Rachel Premack, editorial director at FreightWaves, which covers supply chains. “They’ll move sand and gravel that would then be crushed into concrete for roads or for laying home foundations. Railroads move the chemicals used to purify water or to compromise fertilizer for crops, soybeans that could become food for humans or [animals] that are then food for humans. It’s a lot of early-chain-type goods.”
Many passenger trains also run on freight rails, and their service could be suspended. Amtrak has already warned of potential disruptions and canceled cross-country trains in anticipation of a strike, though so far its Northeast service will not be affected.”
“Replacing freight with other forms of transportation is not easy if workers do walk out. Mike Steenhoek, executive director of the Soy Transportation Coalition, told Vox in an interview that one train has the freight capacity of 400 semi-trucks. “I don’t know of a shipper who just has 400 semis sitting in a garage ready to be accessed,” he said. He noted that for agriculture, the timing couldn’t be worse because of harvest season, adding more urgency for a deal.”
“Under the Railway Labor Act, Congress has the ability to block or end a rail strike. Since 1963, it has passed legislation more than 10 times to intervene in rail disputes.
So far, though, Democratic leaders have been reluctant to commit to doing so, while Republicans have been eager to pressure workers into agreeing to the terms set by the presidential emergency board.
If Congress were to intervene, there are a few routes lawmakers could take. They could require the unions and carriers to accept the presidential emergency board’s conditions, which included a pay increase but no acknowledgment of other demands like sick leave. They could extend the existing cooling-off period so both sides have more time to negotiate. Or they could turn the talks over to independent arbitrators who would be tasked with finding a resolution.
For now, congressional Democrats are waiting to see what might come out of the talks the Labor Department is leading between unions and railroad carriers on Wednesday before they lay out a policy response.”
“So if there’s enough food to go around, why has the global trend toward lower levels of hunger recently reversed? “As of today, the world has no global shortage of food, but food is quite expensive and people’s wages have not adjusted yet,” said David Laborde, a senior research fellow at the International Food Policy Research Institute. “The main issue is that we have problems moving this food around, either due to the war or export restrictions.”
As a result, world food prices reached an all-time high earlier this year, according to the Food and Agriculture Organization of the United Nations.
The price increases are the result of a concatenation of events stemming from the disruptions caused by Russia’s invasion of Ukraine, including price increases in fuels and fertilizers and blocked grain exports. In addition, the WFP notes, “Conflict is still the biggest driver of hunger, with 60 percent of the world’s hungry living in areas afflicted by war and violence.”
In a world with more than enough food to feed everybody, despotic governmental brutality and stupidity are once again causing famines.”
“Long-haul driving, in particular, can be grueling, with lengthy wait times that aren’t compensated and other costs to being out on a route for stretches at a time. “Why do people not want to become truck drivers? That’s the situation, or the root of the issue. And the reason for that is it’s a shitty job,” said Hanno Friedrich, associate professor of freight transportation at Kühne Logistics University.”
“The first thing to know about the truck driver shortage, experts said, is that it’s not exactly a shortage. “It’s a recruitment and retention problem,” said Michael Belzer, a trucking industry expert at Wayne State University.
In the US, “there are in fact millions of truck drivers — people who have commercial driver’s licenses — who are not driving trucks and are not using those commercial driving licenses, more than we would even need,” Belzer said. “That’s because people have gotten recruited into this job, maybe paid to get trained in this job, and realize, ‘This is not for me. This is not adequate for what I’m doing.’”
When it comes to recruitment, it’s hard to get people into the business, especially young people. There’s often a gap between when people leave school (say, age 18) and when they can legally drive a truck across state lines (typically age 21), which means those folks may have already found jobs and aren’t going to be wooed away to become truckers.
There are other barriers to entry, like schooling (the costs of which can vary) and the ability to obtain a special class of driver’s license. Around the world, training and testing for truck drivers stalled because of Covid-19 lockdowns. The industry also struggles to attract women into the workforce because of safety concerns and inadequate accommodations along routes and at rest stops.
But truck driving also isn’t the job it used to be. In the United States, for example, deregulation of the industry, which accelerated in the 1980s, alongside the decline of unions, means trucker wages have been shrinking for years. But the work itself hasn’t really changed. It involves long hours, and a lot of that can be time spent uncompensated. “You could spend all day or a day and a night waiting around to get a load at a port site offloaded and loaded up, and you’re not getting paid for any of that time,” said Matthew Hockenberry, a professor at Fordham University who studies the media of global production.
This feeds not just into the recruitment problem, but also the retention problem. Truck drivers are burned out. Long-haul drivers, especially — that is, those who are moving cargo long distances or across states — typically get paid for the trips they take, and they have to go where the cargo needs to go, with little control over when and where. “The route is the route,” as Weaver put it.”
“The toughness of being a truck driver — the long hours, the treks, the waiting at ports or warehouses to get the goods — isn’t an accident. It’s mostly a consequence of being caught up in the demands of the modern supply chain, the one that is under so much pressure now.
Experts told me that even as wages for truckers have declined, shipping and logistics companies are increasing their rates. But that hasn’t really trickled down to the truck drivers’ pockets. “The trucking companies fight over the scraps. And the drivers fight over the scraps left over after the trucking companies fight over it. All of this cascades down, and the most powerful party here is always the one to win,” Belzer said.
And, he added, when it came to truckers: “Because of where they stand in the power relations throughout the supply chain, they’re the least powerful people.”
Experts and those involved in the trucking industry said wages for truckers have ticked up because of the labor demand in this stage of the pandemic, just as they have in other parts of the labor market in the US. There may be good signing bonuses to be had, too. But truckers don’t have a say in the routes they drive, or how long it takes for their cargo to be offloaded at a port. The job remains difficult, and it might not be enough.”
“A lack of robots is one of the single biggest problems among the many logistical issues currently tangling America’s supply chains.
At most major ports around the world, the cranes that unload shipping containers from boats to trucks are largely automated. That means they can operate around the clock at lower cost and—extra importantly right now—have zero risk of catching COVID-19. One recent study found that cranes at the mostly automated port in Rotterdam, Netherlands, are roughly 80 percent more efficient than cranes at the Port of Oakland, California, where humans still man the controls. In other words, it takes nearly twice as long to unload the same ship in Oakland as it would in Rotterdam.
One of the major hurdles to automation is the expense. It can cost as much as $500 million to install new, fully automated terminals at existing ports, according to the Journal of Commerce, a trade publication. Even if it might make sense to do that in the long run, short-term considerations keep American ports operating at their current, less efficient status quo.
Conveniently, Congress has just passed a $1.2 trillion infrastructure spending bill—one that includes $17 billion for port infrastructure. Of that $17 billion, about $2.6 billion is specifically earmarked for defraying the cost of upgrading equipment at America’s ports, nominally to reduce air pollution.
If you were a member of Congress looking to spend a bunch of money to immediately and meaningfully upgrade American infrastructure in a way that would help solve the current supply chain logjams, automating ports should be at or near the top of the list. It’s quite literally a no-brainer.
The bad news, however, is buried on page 308 of the 1,600-plus page bill: “The term ‘zero-emission port equipment or technology’ means human-operated equipment or human-maintained technology.”
Yes, the subsidies doled out as part of President Joe Biden’s bipartisan infrastructure deal are expressly forbidden from being used to automate operations at American ports. Instead, taxpayers will spend billions to upgrade existing cranes with lower-emissions alternatives that won’t actually work any faster or cheaper. It’s a major missed opportunity.
Why? Biden’s close ties to labor unions probably have something to do with it. Along with the cost, unions are the biggest reason why American ports don’t have more robots. When an automated terminal was introduced at the Port of Los Angeles a few years ago, the politically powerful longshoreman’s union that represents dockworkers threw a fit.
But the automated terminals were a hit with truck drivers who work at the port. The Los Angeles Times reported in 2019 that drivers, who are paid by the delivery, were thrilled to have more reliable loading schedules, instead of having to wait around for hours to pick up a container. One truck driver told the paper that automation meant no longer having to “wait hours and hours in long lines” because the dockworkers decided to “leave early to go to lunch and come back late.””
“Automated ports in places like Norfolk, Virginia, meanwhile, are handling record volumes with no backlogs, according to the Journal of Commerce. “With the automation, you can rework your yard to say, ‘Okay, while I was expecting to be loading Ship A first, I’m now loading Ship B first,′ and can keep import flow fluid,” Stephen Edwards, CEO and executive director of the Port of Virginia, told the Journal in September.
Ports should invest in automation regardless of whether Congress is subsidizing that transition, of course. But if lawmakers are going to approve huge amounts of new spending to upgrade American infrastructure, it’s fair to wonder why one of the most useful upgrades is expressly forbidden. It looks like Congress and the White House are more interested in cowing to unions than helping fix America’s supply chain problems.”
“these shortages and delays are the product of many cross-cutting problems that have existed for years, including the Covid-19 pandemic, rising consumer demand, and a global and highly optimized manufacturing network that doesn’t adapt to change quickly.”
“What the pandemic did do was cause factories to shut down, usually because there weren’t enough workers, and that created shortages of products and components. Those shortages led to bottlenecks and delays in product manufacturing (if factories don’t have the parts to build something, it doesn’t get made and doesn’t get shipped).
As more shortages lead to more bottlenecks, the disruption causes problems in other parts of the supply chain, creating even more shortages, new delays, and higher prices. For example, automotive manufacturers haven’t been able to make cars and trucks, because they can’t get their hands on enough computer chips. Ikea can’t ship furniture parts from its warehouses to its stores thanks to the trucker shortage. A supply crunch for petrochemicals has driven up the cost of making anything that includes plastic, including children’s toys.”
“US companies have been moving more and more manufacturing abroad for decades, which means a growing amount of the stuff American consumers want to buy needs to be imported. Meanwhile, worsening conditions for truck drivers in the US have made the job incredibly unpopular in recent years, even though the demand for drivers has gone up as e-commerce has become more popular. That means that as Americans relied more on online shopping during the pandemic, getting goods from ports to doorsteps has been challenging.”
“Covid-19 has also affected consumer demand — namely, which products they want to buy and how much — creating constant changes that the supply chain just hasn’t been able to keep up with, especially lately.”
“This record number of imports is slowing down product deliveries. Cargo ships carrying holiday merchandise are waiting to unload their stock along the California coast, but there aren’t enough port workers to do the job. Those delays mean there are fewer containers available for manufacturers trying to send more products to the US, which only sets the supply chain back even more.”
“Pushing the Port of Los Angeles to operate 24/7 is Biden’s most direct action to date, and it’s supposed to ensure that an additional 3,500 cargo ships are unloaded each week. The Port of Los Angeles and the Port of Long Beach, which expanded its operations last month, are responsible for 40 percent of the containers brought into the US, so expanding their operations is supposed to speed up shipping nationwide, the White House says.”
“it’s not clear what Biden can do to fix the bottlenecks occurring higher up in the supply chain, like manufacturers running low on components and factories getting shut down abroad. While the White House has convened task forces to address these underlying problems, those efforts probably won’t bear fruit in time for the holidays.”
“In the long run, it’s possible that the US government can change policies that contributed to this situation in the first place. Politicians could shift their approach to trade, which has historically encouraged US companies to manufacture products abroad. Improving labor standards might boost working conditions for truckers and factory workers to make those jobs more appealing — boost global vaccine manufacturing and ensure that workers in other countries are safer from Covid-19 outbreaks. Admitting more people into the US could address a shortage of delivery and port workers.”
“The Wall Street Journal reports that Walmart, Target, Costco, and Home Depot are among the major retailers to adopt the “if you want something done right, do it yourself” approach to importing goods. Worker shortages and COVID-19 protocols have slowed trans-Pacific shipping considerably—it now takes about 80 days to transport items from Asia to the U.S., about twice as long as it did before the pandemic, the Journal reports.”
“many of the bottlenecks are domestic issues. For example, major ports in Europe and Asia operate around the clock, but American ports run at about 60 percent capacity because they close at night and on Sundays. Even when dozens of ships are waiting to be unloaded, inflexible union rules that govern dockworkers’ and truckers’ hours make it difficult to meet swelling demand.
By chartering smaller, private ships to carry their goods, retailers like Walmart are hoping to bypass the backlogs by landing at smaller ports up and down the east coast. That will cost more money—and those costs will be passed onto consumers—but that’s better than running out of inventory during the Christmas rush. Home Depot, for example, is relying on chartered ships to deliver only a small percentage of its overall inventory with a focus on high-demand items like plumbing supplies, power tools, holiday decor, and heaters, the Journal reports.
Getting goods onshore is only half the battle. There are plenty of other bottlenecks to be navigated, like a 25-mile freight train backup that occurred at a major shipping facility outside Chicago earlier this year. At the port in Savannah, Georgia, The New York Times reports that workers are “running out of places to put things” as they unload ships, snarling both ground- and sea-based transportation.”
“”The coronavirus pandemic has snarled global supply chains in several ways. Pandemic checks sent hundreds of billions of dollars to cabin-fevered Americans during a fallow period in the service sector. A lot of that cash has flowed to hard goods, especially home goods such as furniture and home-improvement materials. Many of these materials have to be imported from or travel through East Asia. But that region is dealing with the Delta variant, which has been considerably more deadly than previous iterations of the virus. Delta has caused several shutdowns at semiconductor factories across Asia just as demand for cars and electronics has started to pick up. As a result, these stops along the supply chain are slowing down at the very moment when Americans are demanding that they work in overdrive.””