Trucker protests against California’s Assembly Bill 5 (AB5) last month led to a pileup at the Port of Oakland that’s now estimated to take a month to clear.
The port offered the update when it released its July results on Wednesday, noting a 28 percent decline in total twenty-foot equivalent units (TEUs) moved in July compared to the year-ago period.
“The port was closed nearly a week last month due to the trucker protests voicing concern over AB5,” the port’s maritime director Bryan Brandes said. “This congestion reduced our overall July volume.”
Imports in July were off 26.7 percent from a year ago to 69,463 TEUs. Meanwhile, exports fell 30.8 percent to 68,153 TEUs.
The port went on to say the lingering congestion from the protests, coupled with existing supply chain challenges, continue to impact operations. Recovery from the protest could take a month, it added.
Protests, the port said, “snarled” its operations, slowed loading and unloading of ships and created a back-up of containers stacked in yards.
“The disruption caused by the strike and supply chain issues are making it harder for exporters to coordinate shipping activities and get their goods out of the port,” the port said.
It also noted a decline in rates for containers from Asia bound for the U.S., which it said suggested a decline in import demand.
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The slowdown is being noted more broadly with the National Retail Federation (NRF) saying last week the trend is likely to be seen through the rest of this year, according to its Global Port Tracker report published in association with Hackett Associates.
Ports are projected to have handled 2.26 million TEUs in July, according to Global Port Tracker. August is expected to see 2.2 million TEUs and the monthly totals are forecast to continue to edge down in the following months.
The AB5 protests stemmed from the bill being signed into law in 2019, which codified an earlier court decision that applied a three-part test to determine a worker’s status with a company as either an employee or independent contractor.
Critics of AB5, also referred to as the gig-worker law, have argued it prevents them from having the choice of whether or not they can remain independent contractors.
The California Trucking Association (CTA) attempted to challenge the law’s applicability to truckers in court, but the U.S. Supreme Court ultimately refused to hear the case in June.
The CTA estimates some 70,000 owner-operator drivers in the state are impacted by the law and said at the time of the Supreme Court decision, “Gasoline has been poured on the fire that is our ongoing supply chain crisis.”
Although the protests involved truckers, the law impacts independent contractors across various professions, including actors, musicians, writers, photographers and film crews among others.
AB5 protests initially broke out among drivers at the Los Angeles and Long Beach ports, largely creating freeway traffic delays.
However, protesting at the Port of Oakland shuttered some terminals before the port announced designated “free speech zones” on the fifth day of protests and threatened law enforcement citations for anyone not in compliance.
A working group established by the port in response to the protests was promised to truckers to discuss their concerns around the law and other regulations impacting drivers.
California Gov. Gavin Newsom’s office said at the time of the protests, drivers and employers have had “sufficient time… to understand the requirements of the law,” and pointed to tax incentives and financing programs aimed at assisting with compliance.