The International Longshoremen's Association scored a victory for its 45,000 dockworkers this month: After its three-day strike against the companies that operate ports in the eastern half of the country, it secured a significant raise for members.
But while the dockworkers won this battle, it seems more than likely they'll ultimately lose the war. That's because this strike was about more than pay — it was also about automation.
If history is any guide, stopping the automation of American ports will be an uphill struggle. The idea that machines and technology can improve shipping is nothing new. It took root almost 70 years ago, when an outsider transformed the business and eventually the global economy.
Prior to the 1950s, getting products from a factory in the U.S. to consumers in, say, India was difficult. Goods would arrive by train or truck at a warehouse near a port, where workers unloaded each item to await shipment. When a freighter arrived in port, workers would then load the goods back on trucks and train cars and bring them to the docks to be unloaded yet again.
Then the fun began. The dockworkers — known as longshoremen — would take items destined for the same part of the world and place them on wooden pallets. Once the pallet was piled high, it would be carried aloft by a crane and deposited in the hold of the ship. More longshoremen would then unload the pallet, piece by piece, placing each in its assigned place within the hold. When the vessel reached its destination, the entire process would be repeated in reverse.
The work of the men who made this system function was dirty, dangerous and time-consuming, depending on muscle. Labor accounted for about half the total cost of shipping goods by sea. And it was needed in bulk: In the 1950s, New York City had more than 50,000 longshoremen toiling on the docks. (Today, the International Longshoremen's Association — spanning the East and Central coasts from Maine to Texas — is about 45,000 workers.)
Malcolm McLean consigned this system to history's dustbin. McLean was an unlikely revolutionary: While he had made a small fortune building a trucking business, he knew next to nothing about shipping.
In the 1950s, McLean had a serious problem on his hands: highway congestion. In response, he formulated an unusual plan to avoid high-traffic areas: Truckers would drive their vehicles directly onto freighters at one port — and leave behind the trailer and cargo. When the ship reached its destination, other trucks from the fleet could take the trailers back on land.
This plan wasted a lot of space in the cargo hold. McLean concluded it would be better if he could detach the body of the trailer and simply stack them on the deck of the freighter. To test the idea, McLean got containers from Brown Industries, based in Spokane, Washington, where the company's chief engineer, Keith Tantlinger, had developed lightweight aluminum shipping containers. The ship was nothing special: a castoff oil tanker from World War II. McLean rebuilt the deck to accommodate his containers and christened it the Ideal-X. On April 26, 1956, cranes in Port of Newark, New Jersey deposited a container onto the ship's deck every seven minutes. The Ideal-X then made its way to Houston .
Until this voyage, the cost of loading loose cargo on a ship of this size averaged around $5.83 a ton. The cost of loading the Ideal-X was $0.16 a ton — a cost reduction of 97%. That savings was largely labor.
His experiment launched a revolution in the business of moving goods to market.
The longshoremen quickly grasped what containerization meant for their way of life. By 1958, New York's chapter of the ILA resolved it would no longer service any cargo arriving in containers.
In a series of tense negotiations over the following decade, the longshoremen unions agreed to allow containerization and automation to proceed in exchange for the shipping companies effectively guaranteed employment at a healthy wage for a small number of full-time workers. Instead of toiling on the docks, the longshoremen would operate the cranes, forklifts and other machines.
This agreement dramatically thinned the ranks of longshoremen in the U.S., even as it left behind a smaller cohort of well paid, full-time workers.
It's this deeper history that helps explain what's happening now. The longshoremen, facing a new threat — robots and artificial intelligence — have secured a pay raise and some promise of security .
Yet the future will almost certainly be defined by more automation, fewer workers and more containers.
Mihm is a professor of history at the University of Georgia.