24 July - 30 July
World’s Key Workers Threaten To Hit Economy With Strikes, Labor Delays
Spotlight on the world’s key workers demanding better pay/conditions and going on strikes, threatening the global economy.
Highlights on the trucker standing down at protests against the AB5 law, UP/BNSF efforts to control volumes by metering containers, and more.
Trending opinion on how California carriers are dealing with the looming implementation of the AB5 law.
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The COVID-19 pandemic has put a lot of pressure on global supply chains. As a result, workers involved in supply chains and logistics have also been put under immense pressure. Drivers, dock workers, security personnel, and various other stakeholders have been dealing with the uncertainty and fluctuations across the supply chain. It seems finally they’ve had enough.
A surge in strikes and other labor protests is threatening industries all over the world, especially the ones that involve moving goods, people, and energy around. From railway and port workers in the U.S. to natural-gas fields in Australia and truck drivers in Peru, employees are demanding a better deal as inflation eats into their wages.
Knowing that their work is crucial to the smooth functioning of the supply chains and the economy, workers have leverage at the bargaining table. With the job market still tight and supply chains remaining fragile, employers can no longer put off worker woes, as these protests would just add to the soaring prices. The risk of recession is very real.
Transportation and logistics employees, the power behind well-oiled supply chains, are standing up to bosses and demanding better pay and working conditions. Workers in warehouses, ports, air and rail freight networks as well as trucking, all over the world have been showing their discontentment with the current conditions.
Many employers ended up pushing the pandemic woes onto workers by expecting them to work despite their health and safety risks. Meanwhile, wage gains are generally lagging behind prices, partly because organized labor is broadly less powerful than it was in previous decades. With rising prices, workers are inevitably going to need higher pay and better working terms.
Much of today’s inflation stems from specific chokepoints— and labor unrest in those key industries could have wider ripple effects on prices. There are also concerns about rebalancing economies. During the pandemic, people purchased more goods and gave up on travel due to COVID risks and lockdowns. But now, it is the expectation that consumers will be eager to travel, reducing the pressure on the supply chains. Labor strikes at such a time by airways staff or airport workers could make travel more difficult, and contribute to the rising inflation.
- Cargo containers started moving again through California’s Port of Oakland this Monday after independent truck drivers stood down from protests that effectively shut down one of the West Coast’s largest ports for almost a week.
- BNSF and UP are metering containers from Southern California to avoid another intermodal meltdown like last summer, but the move is causing some import boxes to sit for six weeks or longer.
- DHL Express announced the groundbreaking on a $105.7 million gateway at Munich Airport, which will be seven times larger than the current facility it rents in the cargo center, and began direct freighter service between the U.S. and Brazil for the first time to support growing two-way trade between the countries.
- The shrinking crude and product tanker fleet could deepen the global energy crisis over the next three years as energy companies try to increase production to meet demand. This is partially due to new building contracts in 2022 being the lowest on record.
Some 70,000 owner-operators in California could have their business upended depending on how the state enforces the AB5 labor law, which could reclassify independent contractors as employees. Following the Supreme Court fallout, California agencies are yet to clarify when enforcement could begin, and the governor’s office said earlier this month that it’s looking into concerns from the trucking industry.
Large carriers have been preparing for the implementation of AB5 since it was passed in 2019. Anticipating the implementation of the AB5 law, transportation solutions provide Landstar, among other large entities, has been planning to create a playbook to help independent owner-operator partners.
Making owner-operator partners aware of the implications of the legal update, Landstar shared pivot options that independent partners could try out. Landstar suggested partners relocate out of state if they want to remain independent contractors with the carrier — or pursue other options — due to the looming implementation of labor law AB5.
The carrier company is also preparing for the probable implementation of AB5 law in other states. The carrier will put “Landstar trailers in the hands of carriers on certain business” if necessary, according to the Vice President and Chief Safety & Operations Officer Joe Beacom.