Logistics disruption with the 8 day Strike at Felixstowe Port

Logistics disruption with the planned Felixstowe Port Strike

Around 1,900 members of the Unite Union are set to go on a 8 day strike over pay (from 21 – 28 August) at the Port of Felixstowe after talks between employers and the union broke down a week ago. In late July 92% of union members voted for strike action over Felixstowe Dock and Railway Company offering a 5% pay increase to its workers.

With workers now set to walk out of the UK’s largest port on 21 August Russell Group has used its ALPS Marine analysis to calculate the value of goods that will be impacted by the strike action. The total impact was put at $800m in trade, with clothing accounting for some $82.8m of that figure, and electronic components a further $32.3m. The figures are based on analysis of previous August trade flows at the Port of Felixstowe.

The disruption at Felixstowe spells more uncertainty for businesses, consumers and governments alike. Ports across the globe are facing congestion, due to a large backlog caused by the pandemic.

“As our analysis has shown today, these strikes could increase the backlog and in doing so, create even more delays, and the effects of this will only be registered in the coming weeks and months."

Disruption has dogged the global supply chain since the onset of the Covid pandemic over two years ago and this year in Europe has been exacerbated by port worker strikes in major ports such as Hamburg.

Felixstowe not only handles large volumes of UK imports but also exports with $108m moved to Rotterdam and $138m to Hamburg. Smaller ports in the UK are seen as potentially benefitting from the strike with volumes and services diverted to other terminals in the country!

Why is everyone going on strike?

Around half of containers brought in to the UK are transported via the port. A spokesperson for Felixstowe Dock and Railway Company said that the port has not had a strike since 1989.

Workers in other industries have also announced industrial action, most notably in the transport sector, over pay as well as terms and conditions.

Negotiations over wages has led to several rail strikes over summer, as workers seek higher salaries to keep up with sharp price rises for goods and services. The Bank of England has warned the UK will fall into recession in the final three months of this year when inflation is set to hit more than 13%. It announced the largest interest rate rise in 27 years - up 0.5% - to 1.75% in an effort to calm inflation.

Upcoming strikes include those on Saturday, 13 August by train drivers from nine rail companies, and further rail staff walkouts on 18 and 20 August by members of the RMT union.

Customers will face disruption to train services as 6,500 train drivers are expected to join Saturday's walkout.