“Serious damage” to the economy — experts describe the potential impact of an impending strike among cargo loaders in British Columbia.
A strike could cause containers to pile up in “important” ports on the West Coast, raising prices for consumers across Canada.
About 7,400 terminal cargo loaders working at British Columbia ports are now scheduled to finish work at 8am Pacific time on July 1. This comes after the International Union of Ports and Warehouses of Canada (ILWU) issued a 72-hour strike notice to British Columbia maritime employers. Association (BCMEA) on Wednesday morning.
In addition to port automation, unions are demanding better compensation to offset the impact of high inflation on workers and provide greater job security in the face of job outsourcing.
More than 30 ports and waterfront employers in BC will be disrupted by the shutdown.
The ports of Vancouver and Prince Rupert are “extremely important” to Canadian trade, said Professor Werner Antwiler of the UBC Sauder School of Business.
About $800 million worth of goods flow into and out of Canada through British Columbia ports each day, he said, roughly a quarter of Canada’s total imports and exports.
“These ports are critical infrastructure. They are a bottleneck to our economy on which we all depend,” he told Global News. “If we were offline for any number of days, we would end up with hundreds of millions of dollars in costs.”
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Even a few days of work stoppage can have a significant impact, but “the longer the strike lasts, the more severe the impact,” Antwiler said.
For example, companies dependent on intermediate goods shipped from Asia will not be able to continue their business. It will either have to source goods from other suppliers or reroute existing shipments through U.S. ports, both of which are costly to revenue, Antwiler said.
Supply chain disruptions associated with the recovery from the COVID-19 pandemic are a major contributor to ongoing inflation, but another significant disruption will cause consumers to face further delays or as a result They may pay a higher price, he added.
“This situation can’t last long without doing a lot of damage to the economy,” says Antwiler.
Who will a strike affect the most?
Manufacturing industries, such as the auto sector and retail, are likely to be hit the hardest because they depend on imports, Antwiler said. He said other industries such as trucking and warehousing could also be affected by the delay.
Antwiler said some workers in these sectors could face layoffs if they lose their jobs as a result of the business shutdown.
Due to the widespread ramifications of a possible strike, parties on both sides of the table will be under “tremendous pressure” to reach agreement and avoid prolonged disruption, he said.
In a statement on Thursday, the Canadian Chamber of Commerce said it was “extremely upset” by British Columbia’s dockworkers’ union filing a strike notice and being ready to withdraw on Saturday.
The economic group’s statement called on the federal government to “use every tool in its toolbox” to thwart the strike.
This comes after federal ministers and British Columbia Premier David Evey publicly urged dockworkers and employers in the province to find ways around the employment problem.
In a joint statement released Wednesday, Labor Minister Seamus Oregan and Transport Minister Omar Al-Ghabra said they support the collective bargaining process and that reaching an agreement remains the focus.
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“We urge the parties to return to the negotiating table and work together to reach an agreement.
“Employers, trade unions, mediators, the government – everyone understands the urgency of what is at stake for the Canadian people and supply chains. We are responsible and the industry and consumers will feel the impact of the work stoppage,” the statement said.
Antweiler believes that even if a strike were to occur, federal and state governments would wait more than two weeks before directly intervening until legislation is passed.
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The volume of trade passing through British Columbia’s ports means that goods aren’t flowing every day, a significant problem for Canadians’ supply chains, he added.
About 3.5 million containers pass through British Columbia ports each year, with thousands per day, Antwiler said. With each passing day, more and more containers are waiting to be unloaded. Even after the temporary stoppage, it will take many more days to clear the stranded cargo and return to normal operations.
Similar concerns were raised last year about the economic impact of the blockades of Coutts, Alta, and the Ambassador Bridge, which connects Windsor, Ontario, and Detroit, Michigan, the latter of which cut about $400 million worth of trade between Canada and the United States. promoting. America on a daily basis. The federal government cited a “threat to (Canada’s) economic security” as the reason when it invoked the Emergency Act to end the blockade and protests linked to Ottawa’s so-called Freedom Convoy.
Despite the initial impact on businesses in the affected provinces, Statistics Canada data show that overall cross-border trade in Ontario and Alberta declined in February 2022, when the lockdown was active. volume increased year-on-year. Businesses interviewed by Global News said they had to adapt to the shutdown, including by rerouting shipments around closed border crossings.
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