Container volume at the Ports of Los Angeles and Long Beach continued to decrease in December for both imports and exports, according to the latest data from the ports.
But the November trade balance numbers from the Census Bureau tell a slightly different story, that of an increase in imports and a decrease in exports.
We expect that difference to be partially or fully resolved with the publication of the Census Bureau’s December import and export data next week.
The decline in container volume is likely to have an effect on the labor market. The jobs data for January, which will be released on Wednesday, will most likely show reduced employment further along the U.S. supply chain.
The number of workers in transportation and material-moving occupations was flat through the first half of last year and then negative in the second half as confirmed by the drop in freight shipments.
Seaport import activity
The downward trend through December in the number of import containers processed at the Los Angeles-area seaports suggests the impact of the trade war on inventories, sales, economic growth and inflation.
The decline in import containers follows a record period of container traffic before the tariffs. The Pacific seaports process nearly half of all U.S. import shipping containers, with ancillary employment and business activity likely to be affected by a reduction in seaport activity.
Seaport export activity
The decade-long drop in exports processed at the Los Angeles area seaports resumed its decline after a reprieve in 2024. The yearly growth rate of exports was negative throughout 2025.
Trade balance
Data from the Census Bureau indicates that the dollar amount of imports moved higher in November while exports declined.
While this divergence is somewhat counterintuitive, November’s imports included large increases in non-ferrous metals and other big-ticket categories that would overwhelm the drop in lower-priced items arriving from Asia.
The trends in imports and exports have moved in step over time. For example, in 2023 and 2024, before the import aberrations that began in November 2024, the value of imports and exports was growing at roughly identical annualized rates of 3.4%. This relationship became distorted in the months before the tariffs were imposed last April.
It is too early to say whether the November census data confirms a return to trend. Will imports drop further because of the tariff tax? And will our trading partners look elsewhere because of a reluctance to buy American goods, causing exports to drop further?
The takeaway
The drop in import shipping containers at West Coast seaports suggests, at the least, a rethinking of the abundance of cheap goods readily available to U.S. households.
The consequences of reduced supplies would be increased inflation at a time of a slowing labor market.
The jobs data to be released on Wednesday will most likely show the impact of reduced trade on the labor market along the U.S. supply chain.
