A life on the docks
Senior shipping executives and labor leaders gathered last month to celebrate the retirement of Jim Capo and Brian Dugan, respectively the chief executive officer and vice president of the U.S. Maritime Alliance (USMX), and Joe Curto, president of the New York Shipping Association (NYSA).
Both groups were very much in the news last year as they negotiated new contracts with the International Longshoremen’s Association (ILA)—USMX for the master contract for ILA members at ports on the U.S. East and Gulf coasts, and NYSA for issues in the Port of New York and New Jersey.
Curto spoke with American Shipper about changes he has seen during his career, 37 years of which was spent at Maher, the largest container terminal in the Port of New York and New Jersey. He rose through the ranks to become Maher’s president after the family-owned stevedore was sold to Deutsche Bank in 2007, and then left a couple of years later to head NYSA.
“It sounds kind of corny, but I thought I could do more from here (at NYSA) in terms of having some influence over the way the port and the industry behaved,” he said. “I just wanted to do something to make a difference... and I think I have.”
He hopes to “keep my finger a little bit in the game,” as a senior advisor to the association, now headed by John Nardi.
Curto recalled how “in the early days of containers, the terminal operating system basically copied systems that were in place for handling general cargo—with tally sheets and a lot of paper.
“When I first started doing trailer interchange or TIR reports at Maher, we had a seven- or nine-part form and it had to be split – for the terminal operator, for the carrier, two or three copies for the trucker, the billing department, for everybody and their brother.
“Maher, like many other operators, saw that containers represented a different technology in terms of not only cargo, but also in the way the documentation was processed,” and moved from paper tally pad to keyboards, to much more sophisticated systems in the truck processing lanes that evolved over time, he explained.
“The transition from tally pad to old fashion CRT with a keyboard to wireless technology to other new technologies was... to get to a more efficient way to move cargo,” he said.
“There was no book back in the early 70s — Container Operations for Dummies.... So a lot was trial and error. Sometimes there were expensive mistakes made if you made the wrong choice. But all of us in the terminal operating business went through the same experiences,” he added.
Curto noted in the mid-2000s, when cargo volumes were moving, Maher and other terminals in New York/New Jersey spent a lot of time studying the possible use of rail-mounted gantry cranes (RMGs) and other methods to increase the density of containers in the port.
That kind of planning lost its urgency with the slowdown in world trade following the financial crisis, and while some New York/New Jersey terminals are busy, “I don’t think we’ve reached saturation or the point where we need to start looking at densifying to that degree,” he said.
(The one terminal that’s installing RMGs, Global, is in a somewhat unique position with its small footprint, but an ability to attract large containerships unable to pass beneath the Bayonne Bridge before its modification is complete.)
Curto said the Mahers, as a family-owned company, may have been able to take a longer-term view of the terminal business than some of the financial investors entering the business today.
During the recent contract talks, getting the ILA to agree to changes in work practices in New York was seen as key by both terminal operators and the liner industry.
Curto said “implementation of the contract is actually going to be left up to the direct employers,” the terminal operators, but NYSA “will be pushing to implement the things that we worked so hard to achieve during bargaining.”
Carriers, “the ones who ‘pay the bills’ – I think they’re going to be looking for results, too,” he said.
Curto said the biggest savings in New York/New Jersey comes from increased productivity, improving the ratio of man hours to containers handled, and moving more containers.
The increased productivity will come through a number of reforms, including a reduction in size of core container gangs from 10 to nine and reducing the number of needed relief workers.
While that reduction in gang size may not seem large, he said it reflects “a substantial change in terms of the way labor perceives the work and also recognition that ‘perhaps we don’t need all the men that we previously hired to do the work.’”
He said savings will also come through attrition of older, higher paid ILA members. As chief clerks and senior supervisors, for example, leave, “the contract provides a means to pay the people who take their place less than the incumbents.” The early retirement incentive in the contract will result in about 300 persons leaving over the next year.
“This could turn out to be a substantial savings for the industry as time goes on,” he said.
“But we also need to push to just move more boxes per hour,” Curto said, and the new contract calls for the creation of a port-wide productivity committee and productivity committees for each terminal.
“I think some terminals are more active and aggressive than others in terms of how they’re going to roll out some of the productivity,” he said. “The message here is there was recognition by both parties – the union and the management – that some change had to occur as a result of these negotiations.”
And while negotiations with the union were protracted and threatened to break down several times, Curto said “the union never said to us ‘look we’re never going to change. We’re going to keep things the way they are. Don’t get any ideas about undoing what is.’ The conversations weren’t like that. The conversations were ‘OK, we recognize change has to occur, but the question is how much change and how quickly.’
“Although the negotiations were at times difficult, we all wanted to get to the same place,” Curto said.