Shifts get scarce amid a slowdown in cargo
The waterfront was booming in 2005 when Joey Hurtado inherited his uncle’s longshore card.
Consumers were spending, and the toys, clothes and other goods they bought had to be hauled across the Pacific from factories in Asia. As a nonunion “casual” on the wharves in Los Angeles and Long Beach, Hurtado got the chance to train and work at one of the nation’s highest-paying blue-collar jobs.
“I was there religiously,” said Hurtado, who joined a throng of hopefuls every morning at a sprawling open-air hiring yard near the ports. Three or four days of work a week was the norm.
Early one recent morning, Hurtado, 27, was at the same hiring spot. The workload was light even for the union dockworkers who are always chosen first. For Hurtado, there was “nothing. I haven’t worked in a month.”
The workforce of nonunion dockworkers has become a kind of barometer for the volume of business at the ports and for the strength of the nation’s economy.
In December 2006, the last month in what became the peak year for business at the harbor, hundreds of casuals were needed every workday for jobs that the International Longshore and Warehouse Union couldn’t fill. On one such day, casuals filled more than 2,000 positions over three shifts, lashing and unlashing cargo containers, driving yard equipment or assisting in clerks’ offices.
In December 2008, casuals were needed just four days, and only 95 found work on the best of those days.
As economies around the world began to slump in 2008, cargo movement at U.S. seaports slowed dramatically, including a 6% drop in Los Angeles and an 11% decline in Long Beach for imports and exports combined. It has been a painful blow to what was one of the country’s last vestiges of steady employment growth.
In such a climate, the desire to win these often dangerous longshore jobs is even greater, and it’s easy to see why. During the first 1,000 hours on the job, dockworkers earn $22.47 an hour. By the time they reach 2,000 to 4,000 hours, they are making more than $25 a hour. And those with the greatest seniority are chosen for the pinnacle: membership and generous benefits from the union, which represents dockworkers on the West Coast.
That’s what keeps Hurtado driving the 15 miles from his Bell home as often as twice a day for the first and second shifts at the ports, especially now that the retail and construction jobs Hurtado also has held are almost equally scarce.
“Unemployment checks really aren’t cutting it for me, and they are about to run out anyway,” said Hurtado, who has two young sons and a wife who works as a clerk for Stater Bros.
“I’ve seen people go from having nothing to having a house and sending their kids to college working on the docks,” Hurtado said. “I just hope it turns around.”
Another casual, 27-year-old Megan O’Donnell of San Pedro, remembers the pride she felt when her father, a dockworker for 35 years, handed his longshore card to her. Like Hurtado, she was a beneficiary of the union tradition of passing the right to begin training and be hired as a casual dockworker to the next generation.
O’Donnell started working on the wharves in 2007, the first time in 15 years that cargo at the ports didn’t increase. Still, she was able to supplement her waitressing work, earning as much as $150 for the one day of work a week she usually got on the docks.
Now, weeks pass between hirings at the seaports, providing further encouragement for her goal of becoming a registered nurse. She says she’s keeping her longshore card, just in case.
“A casual card is the perfect thing to have when you are still in school,” O’Donnell said. “It’s always good to have a backup plan.”
A turnaround isn’t on the horizon yet.
Around the world, more than 200 cargo container ships have been idled because there is too little cargo for them to carry profitably, industry experts said.
Those ships are capable of hauling a combined 550,000 containers, or the same amount of cargo moved by the ports of Los Angeles or Long Beach in a typical month. It’s equal to 4.5% of the world’s container ship fleet, making this worse than the last international shipping slump in 2002, when 3.5% of a significantly smaller world fleet was out of work, experts said.
“This is really unprecedented,” said Paul Bingham, managing director of global trade and transportation practice at IHS Global Insight. “We don’t have anything to compare this to in the post-World War II era.”
IHS Global Insight is predicting more of the same through at least the first half of 2009. It’s expecting improvement if Congress and the Obama administration agree on a big economic stimulus package -- and it works.
Erik Autor, vice president and international trade counsel for the National Retail Federation, said the next few months “will be difficult.”
“I don’t think anyone knows where the bottom is,” Autor said.
The slowdown has been so pronounced that ILWU International President Robert McEllrath took the unusual step of appealing to his rank and file to share the work instead of jostling for the double shifts and extra pay that were common in the boom years.
“This recession may be the deepest our present union members have ever experienced. It’s time to ask yourself ‘Is it fair for me to have two jobs in one day when others don’t get one?’ ” McEllrath wrote in the union newspaper.
On the management side, shipping lines and terminal operators have used fewer “steadies,” workers who report directly to the same employers every day instead of to the union hiring hall in exchange for a guarantee of five or even six days of work.
Some weeks “we’re not able to guarantee four or even three days of work,” said Jim McKenna, chief executive of the Pacific Maritime Assn., which is composed of the shipping lines and terminal operators at the nation’s West Coast ports.
“We are anticipating 2009 to be pretty dismal,” McKenna said.
On a recent afternoon, Port of Los Angeles Executive Director Geraldine Knatz looked out from her office onto a shipping channel that seemed quiet enough to allow water-skiing.
In a December letter to port employees, she warned that first quarter 2009 port business could decline as much as 30%, in part because Denmark-based A.P. Moller-Maersk, the world’s largest shipping line and the port’s biggest tenant, is moving some of its local operation to Seattle. Port tenants might find it hard to meet their rent obligations.
“We are going to try to work with everybody,” Knatz said. “We are willing to cut back on our side because we want to help our customers as well. We are trying to reduce our expenses to be flexible as possible.”
Landlord ports such as Los Angeles and Long Beach have no independent taxing authority and rely on negotiated leases for their revenue, said Dick Steinke, executive director of the Port of Long Beach. In exchange for improved terminals and better equipment such as cranes, the tenant shipping lines and terminal operators agree to do enough business to allow a decent return on the port’s investments.
In the past, every tenant easily met those requirements, but 2009 might be the first year that some won’t, he said.
“This is something I haven’t seen in the 20 years I’ve worked at this port,” Steinke said.