For the first time in nearly 50 years, dockworkers on the East and Gulf Coasts went on strike Tuesday, a move that will cut off most trade through some of the busiest U.S. ports and could send a chill through the economy.

Members of the International Longshoremen’s Association union, or ILA, which represents roughly 45,000 workers, started setting up pickets after talks failed to avert a work stoppage.

“Nothing’s going to move without us — nothing,” Harold J. Daggett, the president of the union, told picketers outside a port terminal in Elizabeth, N.J., on Tuesday.

But in a sign that the union and the group representing port employers might be getting closer to a deal, Daggett told CNBC on Tuesday morning that the union was now seeking raises that added up to 61.5% over a six-year contract, down from the 77% the union had asked for earlier in negotiations.

The United States Maritime Alliance, the employers’ group, said Tuesday that its latest offer had included raises of nearly 50% and that it looked forward “to hearing from the union about how we can return to the table and actually bargain.” In addition to wage increases, the use of new technology in the ports has been a sticking point for the union.

On Tuesday morning, Daggett’s son, Dennis A. Daggett, who is an ILA executive vice president, was part of a large picket line outside a port terminal in Bayonne, N.J. He said that morale was “phenomenal,” and that the union was going to keep pushing for better wages.

Trade experts say that a short strike would cause little lasting damage but that a weekslong stoppage could lead to shortages, higher prices and even layoffs.

The prospect of significant economic damage from a strike puts President Joe Biden in a quandary five weeks before national elections. Before the strike, he said he was not going to use a federal labor law, the 1947 Taft-Hartley Act, to force an end to a port shutdown — something President George W. Bush did in 2002. But some labor experts said he might use that power if the strike started to weigh on the economy.

But invoking the 80-year-old law could alienate unions and diminish crucial support among labor groups in battleground states like Pennsylvania, Wisconsin and Michigan.

— New York Times

Job openings point to strong labor market

U.S. job openings rose unexpectedly in August as the American labor market continued to show resilience.

The Labor Department reported Tuesday that employers posted 8 million vacancies in August, up from 7.7 million in July. Economists had expected openings to be virtually unchanged. Openings were up in construction and in state and local government.

Layoffs fell in August. But the number of Americans quitting their jobs — a sign of confidence in their job prospects — slid to the lowest level since August 2020 when the economy was reeling from COVID-19 lockdowns. Job openings have come down steadily since peaking at 12.2 million in March 2022.

Eurozone inflation drops below 2%

Inflation in the eurozone dropped below the European Central Bank’s target in September for the first time in more than three years, paving the way for faster interest rate cuts.

Consumer prices rose 1.8% on average across the eurozone in the month, down from 2.2% in August, data published Tuesday showed. The region’s central bank, which sets interest rates for the 20 countries that use the euro currency, targets inflation at 2%, a goal last attained in 2021.

With inflation back below the target rate and the eurozone’s economy struggling, investors are betting that the central bank will speed up the pace of its rate cuts.

— From news services