After a strong start to the year, trucking jobs are beginning to stabilize as megacarriers’ first-quarter earnings reports reveal a continuation of the freight recession.
According to the latest numbers from the Bureau of Labor Statistics, 300 trucking jobs were eliminated from the economy in April. This marks the first monthly decline since last October when nearly 3,000 jobs were lost.
David Spencer, vice president of market intelligence at Arrive Logistics, told Land Line that asset carriers are being pressured to provide lower contract rates compared to a year ago. Weak rates are being reflected in abysmal Q1 earnings reports by some of the largest freight companies, including J.B. Hunt, Knight-Swift and Landstar.
However, some trucking companies refuse to play ball by discounting rates, which comes at the cost of fewer drivers on the payroll. Weathering the dry season from January through March, those companies are banking on the historical increase in volume seen from April through July as produce season begins.
“The conditions we see in this period will likely be a strong indicator of what to expect from a trucking employment environment moving forward,” Spencer said. “A weak peak season, and we will absolutely see more carriers throwing in the towel, resulting in further pullbacks in employment. A strong peak season would likely mean we are closer to the end of the down cycle, and it could be a sign to carriers to continue to invest in expanding their operations ahead of a potential sustained disruption, where carriers have much greater opportunity to earn profits in the spot market.”
With the first quarter of 2024 out of the way, trucking jobs are up by 6,000 for the year. However, total employment in trucking is down nearly 21,000 jobs compared to a year ago.
Revised numbers do not show any significant changes from what was initially reported, with an increase of 4,100 trucking jobs in March (compared to the initially reported gain of 5,100) and a gain of 1,400 jobs in February (compared to the initially reported increase of 1,200).
Accounting for all transportation sector jobs, employment rose by nearly 22,000 jobs.
The transportation sector’s net increase was largely the result of a surge in employment in the couriers/messengers and warehousing/storage subsectors, each seeing a hike of nearly 8,000 jobs. Only two subsectors experienced a drop in employment: trucking and scenic/sightseeing transport (minus 100).
Updated data reveal higher job numbers for the transport sector as a whole. Employment increased by nearly 6,000 in March, up from the previously reported gain of 1,200 jobs. February’s revised numbers show an increase of more than 31,000 jobs, a significant jump from the initially reported gain of 22,500.
Transportation jobs are up by 55,000 in the first quarter, quickly regaining the 69,000 jobs that were lost last year.
Month to month, wages dropped in April but remained higher year-to-year. Average weekly earnings of all employees in the transportation and warehousing sector went down by nearly $12 to $1,160.52. Compared to April 2023, hourly earnings increased to $30.55 from $29.02. Accounting for only production and nonsupervisory employees, average weekly earnings decreased from $1,089 in March to $1,083.94. Hourly earnings increased by $1.39 from March 2023 to $29.06.
Across all industries, employment growth slowed down, with a modest increase of 175,000 jobs. The unemployment rate rose 0.1 percentage points to 3.9%. Compared to the previous year, the unemployment rate for transportation and material-moving occupations decreased from 5.1% to 5.0%. LL
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