- The port strike could spark a US recession if it lasts four weeks or longer, Sea-Intelligence's Alan Murphy said.
- The researcher estimated that the strike will cost the US $3 billion to $5 billion a day.
The economy could see a hard landing if the ongoing port strike lasts long enough, according to one industry researcher.
Alan Murphy, the CEO of the liner research firm Sea-Intelligence, estimates the US could tip into recession if the port strike lasts longer than a month. That's due to the mounting costs of the strike, which is estimated to cost the economy billions of dollars a day, he said in a recent interview with NBC, citing projections from other experts.
"Various estimates from different economists puts it at somewhere between $3 billion to $5 billion a day," Murphy said, pointing to delayed shipments and potentially higher freight costs.
It's unclear how long the strike will last. The Biden administration could potentially order dockers back to work by tapping one 1947 law, which allows the president to intervene in critical labor disputes.
If the strike lasts longer than a week, importers will likely have a "manageable crisis" on their hands, Murphy said.
In two weeks, that crisis could escalate into a "big challenge," as vessels could head back to their starting destination, which would raise freight costs.
By the third week, global shipping costs will likely rise, he estimated.
"By estimates, it's almost certain to push the US into a recession this year if it lasts longer than a month," he added.
East and Gulf Coast dockworkers began striking Tuesday morning after the International Longshoremen's Association and the US Maritime Alliance failed to reach an agreement before workers' union contract expired.
Analysts have warned that the work stoppage could impact supply chains for months, with one economist estimating that the impact of a two-week strike could stretch into 2025.