After a year of strong growth in the transportation industry it seems that this growth has begun to slow down. Many shippers are reporting that they have seen some easing in availability when scheduling trucks and are hopeful that the capacity crunch is beginning to balance out. Of course, many factors come into play when determining trucking capacity, including consumer demand, factory output, and the physical number of trucks on the road.
Some are speculating that a slowing global economy may be the reason why it’s a little easier to find a truck this year. Reports by analysts such as the Cass Information Systems Freight Index and the American Trucking Association show volume is comparable to last year. Volumes are expected to expand yet in 2019, but not at the same rate as 2018. At the same time, equipment manufacturers are reporting a good year and The American Trucking Association showed 3% more capacity entered the market for truckload and LTL as of January and February as a result of truck orders.
Despite a healthy capacity, the tariffs and the trade war add in another element of uncertainty. Containers arriving to beat new tariff deadlines can cause unexpected boosts in freight, and sometimes drags as global economies shift in reaction to trade talks. Its likely this situation will still take months to resolve as President Trump continues to talk of new tariffs on Chinese goods and negotiations continue.
Of course, many other issues that caused problems last year remain. Carriers are still struggling with the hours-of-service (HOS) requirements, the electronic logging device (ELD) mandate, and the ever-growing driver shortage which were blamed for the shortage of available trucks on the road.
The driver shortage is unlikely to go away unless carriers can attract millennials to the job as the average age of truck drivers continues to rise each year. While the job is seen as undesirable by the younger generations, trucking companies are doing everything they can regarding pay to help with this issue. They are offering guaranteed pay, detention pay, more regular weekly pay and in some companies’ salaries. They are also working on finding ways to increase drivers’ home time and investing in better equipment. But that doesn’t change the numbers, the median age of truck drivers is 49 comparted to 42 for the rest of US workers and even more are retiring. Along with this the current age to drive a tractor-trailer across state lines is 21 which means the industry misses out on a large pool of drivers that could be hired.
The driver shortage doesn’t seem like something that is going to be resolved soon. To combat this and tight capacities shippers are working towards becoming shippers of choice. This includes doing extra for drivers such as provide safe locations for them to take their rest breaks, being welcoming, and making sure that they are not holding drivers up at their facilities.
Although the industry has slowed since 2018 it seems that the same issues are continuing to follow it along with continued growth. If you have any questions about logistics or what ChemCeed is going to handle these issues, please contact your sales agent for information.