The strikes risk "empty shelves and stockings" © Photo by Dave Rushen/SOPA Images/LightRocket via Getty Images
The strikes risk "empty shelves and stockings" © Photo by Dave Rushen/SOPA Images/LightRocket via Getty Images

Liverpool port strikes hit at ‘critical moment’ for Christmas stocks

25 October 2022

Industrial action at the Port of Liverpool will hit UK supply chains at a “critical moment” in the run-up to Christmas, and may necessitate cautionary steps from businesses.

Around 600 members of Unite the Union working at the Port of Liverpool started a two-week-long strike on Monday, following pay disputes with Peel Ports.

Liverpool is the fourth-largest port in the UK, and moves around $1bn in trade every week. Its workers have held several strikes since August, alongside similar action by staff at Felixstowe Port. This is expected to have a greater impact than previously, as it falls in the peak shipping season in the run-up to Christmas.

Supply Management spoke with several organisations about the impact ongoing industrial action may have on UK trade.

Research by supply chain tech firm e2open found that exports from North America to Europe have remained at an all-time high over the past three months, taking 68 days from time of booking to the receipt of goods. This is the same as last quarter, but eight days longer than the same period last year.

Gary Barraco, assistant vice-president of product marketing said this was in part due to port strikes in the UK, as well as the war in Ukraine and road congestion around northern ports in Europe.

Barraco told SM: “With holiday peak and Christmas just around the corner, industrial action hits supply chains at a critical moment. Businesses will need to take action to mitigate any disruptions, at the risk of empty shelves and stockings.”

Separate research from supply chain advisory Drewry Logistics also suggests strike action at Liverpool is adding to “shippers’ woes”, and the company said it expects disruption will continue throughout the fourth quarter of the year. It added: “Rising inflation increases the likelihood of strike action in other markets as dock labour pushes for higher wages to address the increasing cost of living.”

Meanwhile, Doug Brown, head of Europe at digital freight forwarder Flexport, told SM: "The impact of a proposed 14-day strike will have implications for both local supply chains – particularly in apparel – and global logistics networks. It could take twice as long for the port to recover and the impact on global logistics networks to unwind.

“Even considering all the factors we have seen over the last two years impacting the supply chain, it is challenging to fully predict what we will see in 2023. We are still living in uncertain and rapidly changing times. As such, it’s essential for companies to have insight into various scenarios and keep their options open with shipping partners/carriers.

“As of now, there’s a mid-to-high probability that we will continue to see minor disruptions, such as labour shortages, impacting ocean freight capacities or costs returning to pre-pandemic levels.”

Workers at Liverpool Port initiated the strike after rejecting the latest pay increase offer of 11% from Peel Ports.

David Huck, chief operating officer at Peel Ports, said: “It’s hugely disappointing that Unite has staged yet another outdated show-of-hands mass meeting which has, very predictably, failed to support our improved 11% pay offer. Our feedback from many, many workers is that they are in favour of accepting but are too reluctant to do so in a mass meeting.”

A spokesperson told SM: “They're not offering 11%. The offer as it stands is around 8.2%. There was a new deal agreed last week between management and the union that would have been put to members, but the board squashed it after it had been agreed.”

Sharon Graham, general secretary at Unite, added: “The Unite team negotiated in good faith with Peel Ports. But the talks ended in farce, with the deal agreed between Unite and senior management being pulled by the board. Peel Ports’ untrustworthy behaviour and its attempts to threaten the workforce are only escalating the dispute.”

This strike follows recent action between 11 and 17 October at Liverpool. That period overlapped with similar action at Felixstowe, which has also seen repeated strikes since August, where delays surged by 88% and a reported $800m of trade was lost.

Richard Ballantyne, chief executive of the British Ports Association told SM that while industrial action is a local matter for employers and unions, “The impacts on national trade, we understand, have been minimal and as ever other ports and routes are available, giving shippers choice.

“Over the last two years the ports sector has certainly demonstrated its resilience. We have operated through very challenging situations such as Covid-related surges and the blockage in the Suez Canal. Indeed, the UK has a range of short and deep sea container ports and routes, which continue to help keep the country supplied.”

Peel Ports was contacted for further comment.

 Want to stay up to date with the news? Sign up to our daily bulletin.

CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates