Trucking Job Losses Slow Amid Overcapacity Issues
Although the trucking industry continues to face overcapacity challenges, the rate of job losses has slowed in recent months due to a temporary boost from peak season employment.
Recent data from the Bureau of Labor Statistics indicates that 700 trucking jobs were cut in September, marking the sixth consecutive month of losses after a prior five-month growth period.
This modest decline in jobs contrasts with industry claims of an oversupply of drivers, especially after a surge of new carriers entered the market in 2021 following skyrocketing freight rates during the pandemic. David Spencer, vice president of market intelligence at Arrive Logistics, pointed out that growth in private fleets likely supports job numbers, as smaller carriers exit the market under unfavorable spot rate conditions. Additional factors keep drivers employed through the end of the year.
“Recent volatility from hurricane relief efforts and disruptions in regular port operations, along with an improved outlook for peak season compared to last year, may help reduce further job losses until typical mid-to-late first quarter slowdowns occur,” Spencer mentioned. “However, a broader recovery appears distant due to current capacity trends, and any increases in rates are expected to diminish as relief efforts become less urgent.”
Revisions showed fewer job losses than anticipated, with August’s decrease adjusted to 700 jobs instead of the previously reported 1,400, and July’s drop revised to 1,900 from 2,000.
Employment Trends in the Transportation Sector
As the third quarter of 2024 concludes, trucking jobs have decreased by over 8,000 for the year, contributing to nearly 13,000 losses during the ongoing six-month decline and a drop of 7,500 since last September. Overall, the transportation sector lost about 9,000 jobs, mainly due to an 11,000-job decline in warehousing and storage roles. Other affected areas included air transportation and scenic/sightseeing transport.
Despite recent losses, transportation jobs still saw a net increase of over 83,000 for the year, with a rise of 46,000 compared to September 2023. While some wages rose and others fell, average weekly earnings in the transportation and warehousing sector saw a slight dip to $1,169.59. In contrast, hourly earnings improved from $29.64 last year to $30.86 this year. Production and nonsupervisory positions also experienced wage increases.
Overall, employment across all sectors rose by 254,000 jobs in September, surpassing economists’ projections of 140,000. This uptick led to a decrease in the unemployment rate by 0.1 percentage points to 4.1%. Notably, the unemployment rate in transportation and material-moving occupations fell from 6.1% to 5.4% compared to the previous year.
The employment report for September followed the Federal Reserve’s decision to lower key interest rates by half a percentage point, which may encourage manufacturing and foster positive effects for the trucking sector.
