Truck and Trailer
forecasting
Because of the 43-day federal government shutdown, we only got visibility this week into payroll October and November payroll employment figures as reported by the Bureau of Labor Statistics. The September jobs report released before Thanksgiving indicated a sizable seasonally adjusted drop in truck transportation jobs – the largest since May of last year, in fact. However, was that just volatility? After all March saw a jump of 8,000 jobs while June employment fell by 4,400 jobs. Or was the decrease the first of at least a few?
The answer is the latter, apparently. For starters, BLS downgraded September’s estimates further, and October and November were weaker sequentially as well, though not to the same degree. The upshot is that we suddenly have a weaker picture of employment, which almost certainly translates into tighter capacity as drivers make up the majority of payroll jobs and clearly are the most subject to major population shifts in short periods of time.
Trucking Employment by the Numbers
Updated Bureau of Labor Statistics data, released after delays related to the government shutdown, show that payroll employment in trucking has fallen sharply over the past three months.
- September trucking employment was revised lower, with an 8,000-job decline versus August
- Employment fell by an additional 1,300 jobs in October and 4,400 jobs in November
- In total, trucking payrolls are down 13,700 jobs over three months, seasonally adjusted
- Employment has fallen m/m in six of the past seven months.
- At approximately 1.51 million jobs, trucking employment is now at its lowest level since June 2021
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Segment-Level Employment Trends Are Mixed
Looking beyond the summary figures, employment trends vary by trucking segment:
- General freight truckload employment was largely flat in October after notable losses in September
- LTL employment was unchanged in October following a significant decline in September – the largest since early 2024
- Long-distance specialized trucking continued to see modest employment erosion
- Local general freight jobs declined again in October
- Local specialized trucking, however, added nearly 3,000 jobs, reaching a record level
These patterns suggest that while long-haul capacity continues to fade in line with weak over-the-road demand, certain localized and specialized services remain more resilient, reflecting differences in demand stability and pricing power across freight segments.
Despite declining employment, average weekly earnings for trucking employees remain at record highs.
- Overall trucking wages reached a new record in October
- Record earnings were also reported for:
- LTL carriers
- Local general freight operators
Much Less Clarity on Truck Freight Demand
Capacity is only part of the truck freight market equations, of course. Falling – or at best stable – employment with rising wages suggests that for-hire utilization has risen but that carriers are hesitant to add headcount due to uncertainty. That situation likely will continue until the industry sees clear signals of a turnaround in freight volume – or at least in pricing.
One metric to watch is the recent uptick in dry van spot rates relative to levels in recent years. Because this dynamic is occurring during a seasonally volatile part of the year, its durability is uncertain. The final weeks of December invariably yield higher van rates, so that will not be a reliable indicator. Also, the post-holiday spot market will be meaningful only if winter weather in January and February proves to be mild, and even that will matter only if van rates remain strong during that period.
Potentially stronger utilization aside, we still have an incomplete picture of economic activity that generates freight as the Federal Reserve has yet to publish industrial production figures for October and November. It will do so on December 23. However, the Fed in November did release an annual revision of industrial data indicating a major downward revision dating back to 2022.
This revision coupled with September data released earlier this month shows manufacturing production at 1.7% lower than in the pre-pandemic month of February 2020. Prior to the revision, the Federal Reserve figures showed manufacturing output at 1.4% higher than in February 2020.
Meanwhile, the consumer sector is sluggish at best. Adjusted for goods inflation, retail trade sales fell 0.5% m/m in September. BLS has not and will not release consumer pricing estimates for October, so all we know is that retail trade sales ticked up 0.1% in October. It’s possible that consumer pricing for commodities declined in October, but, if so, it was likely due to gasoline prices, which apparently declined during the month.
By January, we should have a more complete economic picture and might have more confidence – or not – that the spot market is heating up. For carriers, it might be a Happy New Year – or a New Year’s Eve hangover.
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