American dock workers went on strike after companies warned that ports would be paralyzed.

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Ports along the eastern U.S. and Gulf Coast were shut as tens of thousands of dock workers went on strike for the first time in nearly 50 years.

Longshoremen represented by the International Longshoremen’s Association left major U.S. ports after their employment contracts expired at midnight on Tuesday. Negotiations over a new contract covering about 25,000 workers have been deadlocked for months over wages and automation, according to the United States Maritime Alliance (USMX), which represents employers.

“We are prepared to fight for as long as it takes,” said ILA President Harold Daggett, urging the USMX to “meet our demands to end this strike.”

The 36 ports stretching from Maine to Texas handle a quarter of U.S. international trade, worth $3 trillion annually, according to an analysis by The Conference Board.

Business groups warned Monday that the work stoppage would “cringe U.S. trade”, halting imports of food, medicine, appliances and clothing. The union said it would continue to handle military cargo.

The closure marks the latest disruption in a global supply chain strained by drought that has limited traffic through the Panama Canal and attacks by Yemen’s Houthi militant group that have driven ships from the Red Sea.

JPMorgan analysts estimated the strike could cost the U.S. economy up to $5 billion a day, but said they did not expect it to last more than a week.

“A one- to two-week disruption will create some backlogs, but outside of some very port-dependent regions, including Savannah, Georgia, there will be more,” said Adam Kamins, economist at Moody’s Analytics. “The wider consequences will be minimal,” he said.

“But any more will lead to shortages and upward pressure on prices. “This will be particularly problematic for food and automobiles, which are particularly heavily dependent on the ports that will be closed.”

The White House said in a statement Tuesday that President Joe Biden is closely monitoring the work stoppage and has been briefed on the agency’s assessment that the impact on consumers is currently expected to be limited, including in critical areas such as fuel and food. , and approx.”

Biden rejected calls from business leaders to invoke a 1947 federal law allowing strikes to be halted, reiterating that he wanted the parties to “reach a fair agreement” on their own.

Business groups have repeatedly asked Biden to mediate the labor dispute, saying that port closures just five weeks before the presidential election will shake the economy.

Hours before the strike began, Susan Clark, CEO of the U.S. Chamber of Commerce, said, “Americans have experienced the pain of product delays and shortages in the 2021 pandemic-era supply chain backlog.” “It is unconscionable to have this much of a shock to our economy due to a contract dispute.”

In a statement Monday, the port union criticized shipping companies for a surge in cargo prices ahead of the strike, saying the companies were “harassing customers.”

It also said it was shocking because its members were “crippled by inflation” and USMX was offering “unacceptable wage packages.”

“They don’t care about us,” Daggett said. “They want to see the entire East Coast and the entire Gulf Coast automated.”

“Believe me when I say that if it were up to them, we wouldn’t have the jobs. “There is something we need to do right now, and that is a strike,” he said.

USMX said in a statement Monday that it has increased its salary offer and has requested an extension to its current contract. “We hope that this action will allow us to fully reopen collective bargaining on other outstanding issues in an effort to reach agreement,” the group said.