Even though the early winter is the trucking industry's busy season, the summertime can be hectic as well. But business really picked up for motor carriers this June, more so than in previous kickoffs to the summer.
Seasonal freight volume among motor carriers – both short- and long-distance – rose 28 percent in June, DAT Solutions reported in its latest North American Freight Index. While it isn't unusual for truckers to see an increase in the amount of goods it transports at this time of year, the double-digit uptick is unusual, so much so that July's freight volume totals may increase further. In 2015 and the years prior to it, the index fell in the first full month of summer.
Huge surge in van freight volume
Nowhere did freight volume rise more than among vans carrying dry and refrigerated products. Compared to May, dry vans carried 49 percent more freight in June and refrigerated experienced 39 percent growth, the report stated. Meanwhile, among flatbed trucks, freight volume fell 0.6 percent month-over-month.
With the trucking sector experiencing a labor shortage, the increase in freight stretches fleets thin. This may affect turnover – the rate at which employees leave positions and are then replaced. Through the first three months of the year, turnover fell 13 percent among large fleets and 1 percent for small fleets, according to estimates from the American Trucking Associations. ATA defines "small" as motor carriers that bring in $30 million in annual revenue or less.
On a percentage basis, the turnover rate in the first quarter was 89 percent. In 2015, turnover averaged 93 percent.
Bob Costello, ATA's chief economist, said that the trucking sector's performance numbers often serve as a microcosm of the U.S. economy at large and this held true through the year's first quarter.
"Should the freight economy witness an uptick during the second half of the year, we should see both turnover and demand for drivers rise as well," Costello forecast.
Based on the latest available numbers, the freight economy seems to be doing just that. In May, for example, ATA's Truck Tonnage Index rose a seasonally adjusted 3 percent, according to ATA's latest Truck Tonnage Index report. That was from April. On a year-over-year basis, tonnage jumped by close to 6 percent.
Instability likely to continue
If recent history is any guide, however, Costello doesn't think the upward trend will continue unabated without experiencing some setbacks now and again.
"Following two consecutive decreases totaling 6 percent, May was a nice increase in truck tonnage," ATA's chief economist noted. "Better consumer spending in April and May certainly helped, but economic growth remains mixed and I'd expect the recent choppy pattern in tonnage to continue for the next quarter or two."
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