In a year of job losses for the trucking industry, November saw another blow, losing an additional 1000 jobs. Despite year-end trends towards job gains for the holiday season, the latest numbers signal a continuation for the US trucking recession.
The loss consists mostly of owner-operators and smaller trucking companies. In the first half of the year, a total of 640 companies in the industry shut down. Freight volumes continue an 11 month streak of decreases. Likewise, manufacturing has seen 4 months of contraction. In spite of trucking job gains in October, the broader trend favors a trucking recession.
From the start of the year, the industry shrank by some 3,700 jobs.
The recession can be attributed to the wax and wane of the industry. 2018 experienced a boom in trucking, approaching record highs. Generally, what follows a period of immense growth is a corrective reaction. New truckers flock to a booming industry, only to find a lack of adequate work in a competitive field. These drivers fall off, while career drivers remain.
Trucking Recession Indicative of a Broader One?
Historically, a recession in the trucking industry proves a harbinger to a general economic downturn. It dipped in April of 2006, earlier than the rest of the economy when the Great Recession struck in January 2008.
However, successive strong jobs reports seem to indicate the economy remains strong. The unemployment rate rests at a record low of 3.5%. While it’s true wage gains have stalled, the job gains appear to be at odds with the dip for trucking.
Some credit this year’s trade war with China, instigated by President Trump, as the culprit behind the downturn for both manufacturing and trucking. The international tiff spawned an industrial recession that impacted an entire subset of fields, trucking among them.
As deals slowly ease tensions and return international trade to the levels they enjoyed before the squabble, trucking may pull out of its recession and expand in 2020’s first quarter.