07
June
2012
|
06:01 PM
America/New_York

Industry Outlook

The trucking industry, while impacted greatly by the economy, has also been a long-time leading economic indicator. As the economy begins to grow, carriers are called on in advance to haul more freight needed to fill a depleted supply chain, from raw materials used in manufacturing to finished goods stocked at distribution centers and on store shelves. That, in turn, leads to a rise in trucking-related jobs and growth in sales of trucks, tractors and trailers.

That scenario is precisely what has been happening for the past few months. Truck tonnage grew 8 percent in January 2011 from a year earlier, boosted largely by growth in the manufacturing sector. That month, the American Trucking Associations' tonnage index rose to its highest level since January 2008, improving for the 14th consecutive month.

In December 2010, truck tonnage rose 4.2 percent from a year ago, also to its highest level in more than two years, and gained 2.2 percent over November. For all of 2010, tonnage increased 5.7 percent compared with the previous year.

Ending a prolonged decline, Class 8 vehicle registrations for the last quarter of 2010 increased slightly from the same period one year earlier, in the process reversing four straight quarters of year-over-year declines. The number of new commercial trailers registered in the U.S. last year represented a 42 percent increase over 2009.

Orders for new Class 8 trucks in North America more than doubled in December from the same month in 2009, and jumped again in January of this year, increasing 25 percent over the pace set in January 2010. In February, new Class 8 truck orders in North America jumped more than 200 percent over the same month last year.

Heavy-duty Class 8 commercial vehicle net orders did drop slightly between January and February of this year. However, while order volume is down between the two months, over the previous four months net order volume on an annualized basis is positive, indicating a trend toward sales growth over the longer term for heavy-duty trucks.

Other good news is coming from the jobs sector. In February, preliminary estimates by the U.S. Department of Labor's Bureau of Labor Statistics (BLS) show that for-hire trucking companies added 11,200 jobs. Unadjusted, the increase in trucking jobs represents the largest one-month surge since December 1990.

Likewise, according to the preliminary BLS figures payroll employment at for-hire trucking companies in February, which includes new hires and positions filled with replacements, increased 3.1 percent year-over-year.

Since the beginning of March 2010, when the number of trucking jobs hit bottom, carriers have added 39,000 jobs. Furthermore, the BLS numbers reflect all payroll employment in for-hire trucking, but don't include jobs in other industry segments, such as truck drivers for private fleets or figures for express delivery companies.

All things considered, recent increases in truck tonnage, commercial vehicle orders and sales, and trucking employment are signs that the industry is climbing out of the recession. Fueling optimism in trucking, this growth can also be seen as an indicator that the North American economy is growing again at last.