forecasting
SCI
The latest employment data from the Bureau of Labor Statistics (BLS) indicates that for-hire trucking shed 1,900 payroll jobs in February, seasonally adjusted. Additionally, BLS made significant downward revisions to previously reported employment figures for December and January. Instead of gaining 4,100 jobs over those two months as initially estimated, the industry lost 800 jobs.
These adjustments significantly alter the employment trajectory reported in prior months. Previous estimates suggested that trucking employment increased by 7,400 jobs between November and January. However, with the latest data incorporated, the industry added only 600 jobs from November through February.
In conjunction with the substantial downward benchmark revision that BLS released in February, the latest data shows that trucking employment has effectively returned to pre-pandemic levels. As of February, employment in the sector is just 0.1% below where it stood in February 2020.
Segment-Level Employment Trends
More detailed data available through January provides additional insight into specific trucking segments:
- General freight truckload employment declined by 2,600 jobs in January, bringing it back to essentially the same level in February 2020 levels.
- Local specialized trucking saw an increase of 3,200 jobs.
- Local general freight employment fell by 3,100 jobs.
- Less-than-truckload (LTL) and long-distance specialized trucking employment were largely unchanged.
As we have pointed out previously, the BLS payroll employment figures do not capture most of the smallest operations, which remain highly elevated in total numbers. The truck freight market still has about 89,000 more for-hire carriers – most of which have just one truck – than it did in February 2020. That’s a delta of nearly 35% even though the carrier population peaked more than two years ago. This non-payroll capacity mostly would augment the payroll figures for general freight truckload and long-distance specialized.
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This article was created from an excerpt from FTR's weekly Trucking podcast with Avery Vise.
Growth in Parcel and Local Delivery Employment
In contrast to the stagnation in trucking employment, couriers and messengers – the federal government’s formal name for parcel and local delivery services – saw a large seasonally adjusted employment gain of 23,500 jobs in February and considerable upward revisions in earlier estimates for November through January.
After seeing very little change for nearly two years, parcel and local delivery has seen strong seasonally adjusted job growth over the past four months. Even larger than February’s gain was the upwardly revised 32,900-job surge in November, which was the seventh largest monthly increase on record.
Looking Ahead
Although trucking employment appears to be stabilizing near pre-pandemic levels, the continued resilience of the population of very small carriers continues to act as a discipline on spot rates and, thus, contract rates as well. With diesel prices apparently moderating – and certainly not surging – active capacity likely will only drain very slowly. Carriers will need a sustained increase in freight demand, especially in the industrial sector, to see a solid recovery in freight rates.
