On October 20, 2021, Governor Gavin Newsom signed Executive Order N-19-21aimed at addressing the massive congestion of cargo at California shipping ports impacting the global supply chain. We previously wrote about the supply chain back up earlier this month. The Ports of Long Beach, Los Angeles and Oakland experienced record volumes in the first six months of 2021, and these ports account for more than 40% of all cargo containers imported into the U.S. However, due to a variety of reasons, including labor shortages, consumer goods are not being off loaded from cargo ships at the ports and are consequently not being distributed through the U.S., causing a national and global supply chain disruption.
The Governor’s Executive Order calls on state agencies to locate state-owned properties which can temporarily store the cargo backing up at California ports. This effort is in response to warehouse space being at maximum capacity throughout the state. Newsom’s Order also temporarily lift restrictions on vehicle weight limits to allow trucks to haul more goods and calls for more vocational training for port worker jobs.
Given the extent of the supply chain back up, it is questionable whether this recent Executive Order will have any significant impact on alleviating port congestion and the supply chain problems. For years, the transportation industry has faced significant driver shortage problems, which have been made worse by California’s strict independent aimed at eliminating owner operator truck drivers in the state. While the Governor’s Executive Order may provide a small amount of relief, the state and national supply chain problems will likely continue for a long time until California addresses its driver shortage and its restrictions on independent contractor truckers.
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