Arizona small business owner expresses worries as port strike looms

PHOENIX – With their contract expiring at midnight, the International Longshoreman’s Association says its 85,000 members will hit the picket lines on Oct. 1, which could impact ports along the East Coast and Gulf of Mexico.

The union is pushing for higher pay, as well as a ban on automation. A prolonged strike could disrupt the supply chain and drive up prices for many goods, from groceries and cars, to holiday presents imported from overseas.

More than 50% of the products imported into the U.S. come through the East Coast, and in advance of what could become a pretty serious supply chain disruption, many businesses have been preparing in advance and stocking up. However, these business owners are still nervous about the strike, as well as how long such an industrial action could last.

At the Princess Mediterranean Market and Deli, owner Noor Alsadi listed some of the items available at his store that came from abroad.

Some from Lebanon, some from Palestine. A lot of these are Greek down here,” said Alsadi.

Customers go to the Mesa store to specifically seek out spices, flavors and tender lamb that can only be found overseas.

“If you look at everything from here, it’s imported,” said Alsadi. “There’s nothing from here that is domestically made.”

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In all, Alsadi owns three markets, with each made up of 90% imported goods. He’s nervously watching the clock, preparing for a potential port strike that will impact him directly.

“I’m still paying two to three times more on things, especially for the restaurant, than I did pre-COVID,” said Alsadi. “This is going to just be a whole other level of increases that we’re not really capable of taking, and I really feel like goods are going to get in, one way or another, but the consumer and small business are probably going to hurt the most on this.”

Other companies, including big businesses like Target, Walmart and Nike knew the industrial action was coming, and they stockpiled apparel and goods from Europe and Latin America that come in through the East Coast ports.

“The stakes are pretty high going into the big season, going into the fourth quarter,” said Dale Rogers with the W.P. Carey School of Business at Arizona State University. “We’re starting the 4th Quarter [on Oct. 1], so it’s not accidental that the dock workers chose [Sept. 30] to be the deadline before the strike.”

Rogers said dockworkers are pretty well paid, with some getting around $150,000 annually. However, they are asking the ports for more money. The real sticking point is preventing ports from bringing in automation, a more efficient approach used by ports in China and Europe. Rogers suspects the ports will cave quickly, not wanting to disrupt the election and holiday shopping season.

However, the strike can’t stave off the inevitable.

“They’re going to definitely try to slow it down,” said Rogers.

Business owners suspect the strike will be short, perhaps lasting two weeks. The situation, however, could turn dire if the industrial action lasts anything past two months.

“If a port closes, the price is just going to go up here, so I don’t anticipate the products going to zero because they are still flowing in from one port,” said Alsadi. “Everyone is going to feel the pinch of a price increase.”

As the U.S. imports a lot from overseas, the port unions are in a very powerful position. Experts believe President Joe Biden will most likely step in next week if he doesn’t see progress.