The Ports of Los Angeles and Long Beach are essential to the economic health and well-being of the Southern California – as well as the State of California and the nation. The two ports are responsible for more than 300,000 jobs for our friends and neighbors. But the world in which the ports operate is increasingly competitive. In a few short months an expanded Panama Canal will be operational, allowing larger vessels to transit the canal. In addition, ports in Canada and Mexico, as well as those on the East and Gulf coasts of the United States, are expanding their facilities – all with the intent of drawing cargo away from Southern California’s ports.

PMA President James McKenna, second from left, and ILWU President Robert McEllrath at the annual TPM 2016 conference.

PMA President James McKenna, second from left, and ILWU President Robert McEllrath at the annual TPM 2016 conference.

In this hyper-competitive environment, the recent announcement that the International Longshore Union (ILWU) and the employer group, the Pacific Maritime Association (PMA), are considering extending their current contract is welcome news. In 2014/2015, the PMA and the ILWU were engaged in a protracted and contentious contract negotiation that resulted in cargo slowdowns at West Coast ports. The impact was widespread and negatively affected all who utilize West Coast ports, especially the ports of Los Angeles and Long Beach. Eventually a contract was agreed upon, one that is set to expire in July of 2019 – but the reputation of our ports was damaged and the international trade community heightened its concerns about the reliability and predictability of our ports. For shippers, exploring the use of alternative gateways to the U.S. was no longer an academic exercise, but a requirement for economic survival.

To avoid a further loss of market share, it is essential that ILWU and PMA agree to an early contract extension prior to mid-2019. This action would go a long way towards erasing the memories of the last round of negotiations, and remove doubts and fears about the future. It is our understanding that the IWLU will consider the PMA offer to extend the west coast labor agreement at their caucus in Panama later this month. For the good of our economy and the 300,000 jobs who depend on our ports, we hope that both parties will move in mutual interest and extend their contract early in order to assure the future viability and competitiveness of our ports.

About the Author: Gary L. Toebben is President & CEO of the Los Angeles Area Chamber of Commerce, the largest business association in Los Angeles County representing more than 1,600 member companies and serving the interests of more than 235,000 businesses across the Los Angeles region. Since taking the helm of the L.A. Area Chamber in July 2006, Toebben has served on the Mayor’s L.A. Economy & Jobs Committee, the L.A. County Health Care Options Task Force and the City Council’s Business Retention & Attraction Task Force.

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