Dani Romero
Tue, October 26, 2021, 3:00 PM
The great global supply chain crisis of 2021 — which has ensnared groceries, holiday shopping and everything in between — has bottlenecked West Coast ports, and drawn the involvement of the White House to address it.
As the disruption reaches a boiling point and adds to rising price pressures, longshoremen, union representatives and truck drivers have pointed fingers over which party is best positioned to alleviate some of the strains.
Cargo ships afloat in the Pacific Ocean demonstrate the convergence of strong consumer demand, and a widespread shortage of bodies to meet it. According to Goldman Sachs, over 30 million tons of cargo await delivery ahead of the Thanksgiving to Christmas rush. Essential workers are still scarce but U.S. consumers are still in a buying mood, meaning the congestion is not expected to wind down until the second half of 2022.
So who exactly is to blame? Some drivers lined up at the Ports of Los Angeles and Long Beach that have spoken to Yahoo Finance in recent days have an answer: Not us.
“There's a lot of us that are willing to work,” Carlos Rameriz, a 25-year truck driving veteran, told Yahoo Finance in an interview.
Speaking from a nearby area where trucks have idled and multiple chassis have sat unattended, Rameriz blasted a reported driver shortage as “the biggest excuse,” and simply “not true.”
Where are the drivers?
Outside one of California's backlogged ports, trucks await cargo to transport.
While the pandemic has exacerbated strains in the economy amid an unprecedented demand surge, a 2019 study published by the U.S. Bureau of Labor Statistics probed the dearth of truckers. And it arrived at a surprising conclusion: “there is no driver shortage in the trucking industry.”
Driver turnover is indeed a major issue, and there’s plenty of anecdotal evidence of carriers struggling to fill seats. To that point, however, that doesn’t mean there’s an actual shortage of drivers, the authors wrote.
However, the trucker issue has been debated for decades, with the American Trucking Association (ATA) first raising concerns in the 1980s. More recently, Chris Spear, president and CEO of the American Trucking Associations (ATA) told CNN last week that the US has a shortage of around 80,000 truck drivers — a record high, and an increase of roughly 30% from before the pandemic, Spear said.
Separately, a number of executives have sounded the alarm, including the CEO of the U.S. Xpress who told Yahoo Finance in August:“The driver situation is about as bad as I’ve ever seen in my career.” Like other industries facing worker shortages, the trucking sector has gone all-in on big pay raises to attract talent.
The record-breaking number of cargo ships waiting off the coast of California prompted President Biden to intervene. Earlier this month, he directed the Ports of Los Angeles and Long Beach to move to 24/7 operations.
Toward that end, Executive Director of the Port of Long Beach, Mario Cordero, told Yahoo Finance Live that Long Beach implemented a 24/7 pilot program at one of their terminals “weeks ago.”
However, truckers like Rameriz hasn’t seen any changes. “I don’t know anybody that is working 24/7,” he explained to Yahoo Finance. “If there was work, we [would] be working 24/7.”
The Biden administration is also considering calling on the National Guard to help transport some of the cargo. If they’re activated, it would mark the latest in a series of unprecedented deployments for its members.
“Please send the National Guard because that will be a big solution,” Rameriz said.
A big problem is that some truck drivers are independent contractors, or owner- operators that get paid by the load. To actually earn money, drivers have to get their own trucks, acquire the skills and certifications to haul — and they have to cover costs such as fuel, insurance, equipment, repair and maintenance.
However, the supply chain knots are throwing a wrench into Rameriz’s pay.
“It's been the worst month I ever had. There's no work. They're not releasing anything from [the port],” said Rameriz. “That's what pays my bills.”
Regardless of which category a driver falls into, many of them are waiting over 3 hours to get inside the port to pick up a container. Sometimes the wait is even longer, Rameriz explained, with drivers at the mercy of longshoremen who operate on their own schedule.
'Cutting the work'
Cargo ships adrift in the Pacific Ocean as the global supply chain crunch grows more acute.
Busy Los Angeles County ports saw a record backlog last month, with more than 70 cargo ships stuck off the coast waiting to be docked and unloaded— carrying everything from furniture to electronics. There, a few workers suggested that their own union leadership shouldered some of the blame.
According to a longshoreman who only identified himself as Alfred, who works at California's San Pedro Bay Port Complex, the Pacific Maritime Association (PMA) — which negotiates with the International Longshoreman and Warehouse Union (ILWU) and oversees the longshore contract on behalf of ILWU member companies — is “cutting the work.”
He added: “They're the ones who are not training: skilled positions. [That] means crane operators, top handler drivers, trans drivers. They're the ones who are keeping the ships out there at sea anchored.”
Despite all the logistical challenges and logjam, Alfred insisted “we have the manpower there, [they] just keep cutting the work.” Another problem: there’s “not enough space” to offload cargo and store it anywhere, the worker said, questioning protocols that were adding to the backlog.
“There are truck drivers that come in and are waiting for a chassis and the company does not allow us to give them it,” Alfred said.
“If we don't have the space and we need to get some of this cargo out, why are we holding chassis, and not giving them to the drivers so they could pick up their load to make more space for us,” he added.
In a statement to Yahoo Finance, the PMA defended its processes, arguing that each stage of the supply chain "must operate efficiently and in concert in order to bring relief to the historic congestion slowing goods movement across the country.”
The statement added that it was “committed to robust worker training to keep West Coast marine terminals moving as efficiently as possible,” and that the ranks of longshore workers and trainees for specialized positions “continues to grow.”
Yet Alfred, who also was a truck driver for years, understands the frustration these drivers are going through. “The drivers are there, literally for hours and hours, and sometimes [they] don't even pick up a load.”
Meanwhile, a series of posts on Twitter led to policy change that could help alleviate some of the pressure on West Coast ports. Ryan Petersen, CEO logistics company Flexport, argued that yard space at the terminals is a major culprit behind the bottlenecks.
In response, the city of Long Beach announced over the weekend that they will relax the current set of container-stacking rules for at least 90 days. That should help ships unload more cargo quicker.
The code limited containers stacking to no more than two containers, no more than eight-feet tall. Now they will allow up to four stacked containers, with potential for five if a request is approved by fire officials.
In a related move, Governor Gavin Newsom has issued an executive order that directs state agencies to find state, federal and private land for short-term container storage, while identifying freight routes for trucks so the state can temporarily exempt weight limits on the road.
Still, it’s unclear whether any of those measures will address a problem without easy or quick fixes.
“It’s getting bad,” said Rameriz. “I hope somebody is keeping an eye on what's going on and do something about it because everybody's struggling right now.”
Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter: @daniromerotv
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