Despite a continued overcapacity problem, the rate by which trucking jobs have been dwindling has slowed in recent months, as peak season props up employment in the short term.
According to the latest numbers from the Bureau of Labor Statistics, 700 trucking jobs were eliminated from the economy in September. This marked the sixth consecutive monthly loss, which was preceded by a five-month growth streak.
A modest loss in trucking jobs seems antithetical to industrywide claims of too many drivers on the road after a flood of new carriers entered the market in 2021 in the wake of a pandemic that sent freight rates skyrocketing. However, David Spencer, vice president of market intelligence at Arrive Logistics, told Land Line that growth within private fleets is likely keeping employment numbers up while smaller carriers continue to bow out in an unsustainable spot rate environment. Other factors are also keeping drivers in seats until the end of the year
“Some volatility over the last week or two from hurricane relief and disruptions in normal port activity, as well as a promising outlook for peak season, at least compared to last year, may help limit further job losses until the typical slowdowns we see in the mid-to-late first quarter,” Spencer said. “A larger sustained recovery still seems a ways away given the capacity trends in the market today, and I expect any near-term rate hikes to fade as the relief efforts die down in urgency.”
Revised numbers revealed fewer trucking job losses than expected, with a decrease of 700 jobs in August (compared to the previously reported decrease of 1,400) and a decrease of 1,900 jobs in July (compared to the previously reported decrease of 2,000).
Closing out the third quarter of 2024, trucking jobs were down by more than 8,000 for the year, with a net loss of nearly 13,000 during the current six-month losing streak and a loss of 7,500 compared to last September.
Accounting for all transportation sector jobs, employment dropped by nearly 9,000 jobs.
The transportation sector’s net decrease was largely the result of warehousing and storage employment plummeting by 11,000 jobs. Other losses were felt in air transportation (down 1,500), scenic/sightseeing transport (down 1,000), trucking and rail (down 200). Job growth was seen in transit/ground passenger transportation (up 3,400), couriers/messengers (up 1,300) and water transport (up 700).
Updated data reveals a bleaker scenario for the transportation sector in the past few months. Employment rose by 3,200 jobs in August, which was less than half of the initially reported gain of nearly 8,000 jobs. In July, there were 1,600 fewer jobs, a complete reversal of the previously reported gain of nearly 6,000 jobs.
Transportation jobs were still up by more than 83,000 for the year, with an increase of 46,000 compared to September 2023.
Month to month, wages were up in some areas but down in others. Average weekly earnings of all employees in the transportation and warehousing sector went down by less than $1 to $1,169.59. Compared to September 2023, hourly earnings increased to $30.86 from $29.64. Accounting for only production and nonsupervisory employees, average weekly earnings increased from $1,101.30 in August to $1,107.54. Hourly earnings increased by about $1 from September 2023 to $29.30.
Across all industries, employment increased by 254,000 jobs, far exceeding the 140,000 jobs projected by economists, according to financial data company FactSet. Consequently, the unemployment rate dropped by 0.1 percentage points to 4.1%. Compared to the previous year, the unemployment rate for transportation and material-moving occupations dropped from 6.1% to 5.4%.
September’s employment report came two weeks after the Federal Reserve announced the highly anticipated lowering of key interest rates. On Sept. 18, the Fed lowered interest rates by half a percentage point to 4.75% to 5%. Lower rates could spur more manufacturing, which could have a positive trickle-down effect on the trucking industry. LL
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