Overview of Trucking Business Indicators: CCJ’s Indicators provide a summary of the most recent reports concerning various aspects of the trucking industry, including rates, freight, equipment, and overall economic conditions.
Trucking Employment Declines for First Time Since July: According to the Department of Labor’s (DOL) monthly employment report, the for-hire trucking sector experienced a reduction of 1,400 jobs in January. The DOL also revised December’s employment figures down by approximately 5,000 jobs from earlier reports. Nevertheless, the industry had seen steady job growth every month during the latter half of 2016.
Overall Economic Landscape: The U.S. economy added 227,000 jobs in January, contributing to a slight decrease in the unemployment rate to 4.8 percent. In comparison, the trucking industry’s employment reached 1.4625 million, an increase from 1.4554 million the previous January.
Broader Employment Trends: While the transportation and warehousing sector lost 4,000 jobs in January, the larger trade, transportation, and utilities sector observed a growth of 44,000 jobs. Additionally, the manufacturing sector saw an increase of 5,000 jobs, and construction added 36,000 jobs during the same month.
Shippers’ Conditions vs. Truckers’ Leverage: According to research firm FTR, conditions for shippers experienced a slight improvement in November. However, projections for 2017 indicate that shippers will face progressively challenging conditions, leading to more favorable circumstances for carriers.
Future Outlook for Trucking Capacity: FTR’s Shippers Conditions Index recorded a minor upturn in November. The anticipated tightening of trucking capacity, along with rising oil prices and inflation, is expected to negatively impact these conditions and enhance market leverage for carriers. Larry Gross, a partner and senior consultant at FTR, asserts that expectations for tightened truck capacity throughout 2017 remain firm despite potential regulatory changes under the Trump administration.
Recommendations for Shippers: Gross advises shippers to prepare contingency plans as they navigate the impending changes. The forthcoming implementation of Electronic Logging Devices (ELDs) in December is anticipated to significantly impact the market, leading to considerable deterioration in the Shippers Conditions Index throughout the year, although the specifics of this shift remain uncertain.
