Keeping Cargo on the Moveby Alwyn Scott, Seattle Times business reporter
Seattle Times, April 3, 2005
John Munson, a lanky 23-year-old in a hooded sweat shirt, recently stopped working construction and running chairlifts to embark on a lucrative new career.
Armed only with a high-school diploma, he could eventually take home a six-figure income. Unlike many blue-collar workers, his future is strengthened, not threatened, by factories in Asia.
The job? Longshoreman at Seattle's seaport, loading and unloading the massive ships riding a wave of global trade.
"It's a good gig if you can get all the way up to the top," Munson said as one of the Port's iconic red cranes whirred overhead, hefting a 40-foot container onto a waiting vessel three football fields long.
Munson and several thousand other new waterfront recruits are part of the massive infrastructure being assembled at West Coast dockyards to handle record Asian cargo and surging pleasure-cruise business.
Last year, shortages of dockworkers and equipment left a logjam of ships sitting outside the big West Coast ports at Long Beach and Los Angeles.
Seventy-eight ships diverted course to avoid the snarl, many docking in Seattle, Tacoma and Oakland, according to the Marine Exchange of Puget Sound, an organization that tracks cargo ships.
This year, even more cargo appears headed this way. Seattle's total container volume is up 44 percent so far this year, after rising 19 percent in 2004. Forecasts for this year envision a jump of a further 10 to 18 percent for the entire West Coast.
"Certainly we're going to see the volumes grow, and you're going to have periods of time when the cargo coming through will present some challenges," said Mike Moore, a vice president at the Pacific Merchant Shipping Association, representing major ship owners and terminal operators on the West Coast.
Seattle and Tacoma have capacity for more cargo, he said. But it remains to be seen whether railroads, ports and trucking companies can work together to avoid congestion.
Some say West Coast ports already are straining to unload cargo and get it on rails without delays. The start of the cruise season next month means even more work on the dock ˆ… porting luggage, loading food and hauling away trash.
If Seattle and other ports can't cope, they could see vital business head elsewhere.
Of the ships diverted last year, "an alarming number went through the Panama Canal to East Coast ports," said Robert Bohlman, the marine exchange's executive director in Seattle. "Cargo that comes here [to Seattle] is discretionary ˆ… it doesn't have to come here."
The explosion of cargo comes from a loosening of trade restrictions that has prompted companies to move manufacturing overseas, especially to China.
Today, the United States is importing more and exporting less than ever before. The U.S. trade deficit, the gap between imports and exports, reached a record $666 billion, up more than 25 percent from 2003.
This year, a turbocharger kicked in: A longstanding system of quotas on textiles and garments expired, ending restrictions on China.
The results are stark: Apparel imported from China through Seattle jumped nearly four-fold in January, to 1,450 containers, from a year ago.
Overall containerized cargo in Seattle shot up 54 percent in January, faster than any other North American port, according to port officials.
To many it is not merely a blip. "I don't even entertain that," said David Olson, a political-science professor at the University of Washington who studies ports. "Those that do don't know what they're talking about."
If ports, rail lines and all the other parts of the infrastructure mobilize, Olson predicted, "cargo on the West Coast ... is going to double in the next 15 years."
Munson is part of the mobilization. The number of dockworkers has jumped 28 percent, or 4,358 positions, since 2004, and stands at 20,147, according to the International Longshore and Warehouse Union, tallying union members and "casuals" in line to join the ILWU.
"That's a tremendous increase," said Stanley Aronowitz, a labor expert and professor at the City University of New York. The hiring reversed a decline from 40,000 in the 1950s and '60s, he said.
And it's still not enough, said Steve Stallone, spokesman for the ILWU. This month Seattle will have added 140 new union members, expanding to about 700, with another 700 casuals, said Herald Ugless, president of ILWU Local 19. Tacoma plans to add 100 members over three months, bringing membership to 847, up from 672 last year. It also is seeking another 550 casuals, said Conrad Spell, president of Local 23.
Yet despite all the hiring, Stallone and others expect labor shortages and lack of equipment will snarl ports this year. "The amount of increase in cargo is faster than the increase in infrastructure," Stallone said.
Last year is a good guide. Despite hiring, shortages of drivers to move containers meant even casuals got plenty of work. Munson says he worked seven days a week for four straight weeks during the peak last fall, lashing cargo containers into the holds of ships.
The job pays $18 an hour ˆ… more than Munson made at construction ˆ… but the work is less steady. These days he spends three or four hours a day at the union hall waiting for a work assignment and lands only 10 or 20 hours a week.
So Munson recently learned to drive a semitrailer at Seattle's bustling Terminal 18, which will qualify him for more jobs and probably double his hours.
"I don't think I'm supposed to be smiling this big in a truck," he said, "but I am. I love it."
In Seattle, the trucking course trains six drivers a week, trying to meet demand. Organizers were "a little late" setting up programs, said Tom Ralls, the lead trainer. "On a really heavy day, there's still not enough semi drivers."
Vindication of upgrading
The extraordinary rise in Port business appears to vindicate Seattle's decision to refurbish its waterfront docks in recent years. But it also points to the challenges ahead.
Instead of converting Terminal 46 to offices and condos, the Port of Seattle spent $72 million to upgrade it as a cargo terminal for Hanjin Shipping of Korea.
Seattle's Terminal 25 is aiming to open in July for domestic shipper Matson, freeing space Matson uses at Terminal 18. SSA Marine, the Seattle-based operator of Terminal 18, is bringing in cranes that will allow it to stack more boxes on its yard.
The improvements were part of $1 billion the Port has poured into improvements over the last 13 years, expanding cargo-handling space to about 570 acres, from 230.
Terminals 5, 46 and 25 all have ample capacity for more cargo, said Port of Seattle spokesman Mick Schultz. "It's a myth that the Port of Seattle doesn't have room to grow."
Indeed, though Seattle's share of the West Coast market continues to decline, the rate of slippage slowed to about half a percent a year in the latest decade from nearly 1 percent a year from 1984 to 1994, according to Bob Hannus, a researcher at Marine Digest and Cargo Business News.
Some docks have added radio-frequency-identification tag systems, Moore said.
Tacoma opened a giant new terminal for Evergreen Marine, a Taiwanese shipping line last year, capable of eventually handling 1.2 million 20-foot equivalent containers (TEUs) a year. Some forecasts expect Tacoma's container volume, which topped Seattle in 2001, to rise 30 percent this year.
Big importers like Wal-Mart have built distribution centers in Washington state so cargo containers can be moved off the waterfront more quickly, Schultz said.
Railroads are adding cars, track and workers, too. Burlington Northern Santa Fe Railway expects Seattle cargo to increase 18 percent this year. It says it has room to increase its capacity 40 percent by reconfiguring some track.
But even with all the workers and expansion, many expect bottlenecks when shipping peaks in the summer and fall. Problems could foul up supplies for factories, retailers and consumers, depressing business during the holiday season.
West Coast ports are straining, said Hubert Wiesenmaier, executive director of the American Import Shippers Association, based in New Rochelle, N.Y., which negotiates rates with ocean carriers on behalf of its members, who are importers.
"There have been serious and constant delays in pushing containers through Long Beach and L.A.," he said. "I think they are running pretty close to capacity."
Some shippers have started rerouting Asian cargo to New York and other eastern ports via all-water routes through the Panama and Suez canals.
Bypassing the West Coast adds time and expense, but at least cargo is more likely to arrive on time.
Getting goods delivered on schedule is crucial, as stores and factories rely on supply chains to provide just-in-time delivery to keep sales and production lines humming.
New megaships, such as the 8,000-container Vancouver that docked in Seattle last month, are 30 percent bigger than the previous generation of ships. And 10,000-TEU ships are on their way. While efficient for shippers, the big ships can overwhelm docks and railyards, causing days of delay.
For now, though, Munson and other new Port workers appear to have hit a rare blue-collar sweet spot. Since their peak in the 1970s, U.S. manufacturing jobs have disappeared by the thousands as industry has shifted to lower-cost workers overseas.
Many former U.S. industrial workers have taken service jobs that typically are lower-paid than the ones they lost.
"One day I'll be doing that," Munson said, pointing at the cab of a hulking crane, where operators earn $40 an hour, noting it may take 15 years to get there.
"That's definitely something to aspire to."
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