Is Labor Unrest a New Norm?

In this week’s Roar: labor is back in the spotlight at ports in Canada and for U.S.-based parcel shippers, Brexit’s still having its impact, there’s down news for manufacturing, and some U.S. Japan cooperation.

Just when it seemed labor issues were taking a break. The problems along Canada’s West Coast deteriorated further. The contract between the International Longshore and Warehouse Union (ILWU) and the British Columbia Maritime Employers Association (BCMEA) ran out months ago, and although the union hoped things wouldn’t follow the path taken at U.S. West Coast ports, as of this writing, port strikes are into their 2nd week, and there are calls for the federal government to step in.

At least schedule reliability is up, as the wsj.com numbers show.

Negotiations between UPS and the Teamsters union have collapsed less than a month away from their current contract expiring. The union says that UPS refuses to present a reasonable offer, and UPS says they’re not in a position to offer more, and that failure to continue negotiations “threatens to disrupt the U.S. economy.”

SMEs in the UK are struggling at a time when the government is professing Brexit a success. It’s true that trade has climbed significantly—by 24%—in the UK, and that larger companies are benefiting but SMEs are taking a hit, to the point where some are no longer trading internationally. One key factor is VAT charges at the point of import, which are up by 100%, a cost some can’t absorb. And unfortunately, most don’t think things will get much better.

The Institute for Supply Management (ISM) has issued the current edition of the Manufacturing Report on Business, which contains more discouraging news. Output is down for the 8th consecutive month, bringing the PMI down to 46, well below a 50 reading, which signals growth. The new numbers put June 2.8% below the 12-month average of 48.8. The US economy, companies saying they’re holding off ordering anything new until 2024, layoffs, and more all play a part.

For something positive, the ports of Los Angeles and Nagoya, Japan have signed a Memorandum of Understanding (MOU) in an effort to expand collaboration on a variety of operational efficiencies and sustainability issues. The main focus is to reduce greenhouse emissions from cargo between the two ports by encouraging the use of low and zero-carbon ships and fuels.

For the rest of the week’s top shipping news, check out the article highlights below.