More Truck Drivers Needed as Consumer Demand Rises

Turnover at truckload carriers is on the rise while consumer confidence rose to its highest level in five years.

This country’s most recent logistics numbers (from the Logistics Market Snapshot, courtesy of the Georgia Center of Innovation) show rising demand for truck drivers while consumer confidence reached the highest level in five years.

·       In the first quarter of 2013, the turnover rate at large truckload carriers rose to an annualized rate of97% from 90% in the previous quarter.  At smaller truckload fleets, the rate rose to 82% from 76% in the previous quarter. (Source: American Trucking Association)

·       U.S. containerized exports totaled 1.07 million TEUs in March, the highest monthly volume since March 2012. March containerized exports were 6% higher than the previous month. (Source: PIERS)

·       Net absorption in the U.S. during Q1 2013 totaled +47.4 million square feet. (Source: Colliers International)

·       The Consumer Confidence Index increased to 81.4 in June 2013, its highest level since January 2008.   (Source: The Conference Board)

·       In May, housing starts rose 6.8% over the previous month.  Year-over-year, housing starts and building permits in May have increased 28.6% and 20.8%, respectively. (Source: U.S. DOC) 

Here are the other market highlights:

Transportation Indexes:

• Dow Jones Transportation index rose 1% during the month of June. (Stock performance of twenty large, well-known U.S. companies in the transportation industry, average of June 10th thru July 10th).

• NASDAQ Transportation Index increased 2.9% in June. (Averaged share weights of NASDAQ-listed companies classified as transportation companies, average of June 10th thru July 10th).

• The USDOT's freight transportation services index rose 1.2% in May 2013. The index’s reading of 114.3 was up 2.7% from May 2012. (Source: US DOT).

• The June shipments index rose 0.1% over the previous month and fell 1.5% year-over-year. The June expenditures index rose 3.4% for the month, and increased 0.8% year-over-year. (Source: Cass Information Systems | Cassinfo.com) (Based upon transportation dollars and shipments of Cass clients comprised of over 400 shipping companies).

Imports and Exports:

• Import shipment volume, in TEUs, at U.S. ports increased 3% in May from the previous month and fell 2.2% year-over-year. U.S. vessel imports in May increased for the second consecutive month and are the highest since last August. The number of bills of lading, or total shipments, filed with U.S. Customs totaled 786 thousand in May, up 2.5% from April. (Source: Zepol Corporation | zepol.com).

• Import volume through major U.S. container ports is expected to increase 1.1% in July. In May, the latest month for which numbers are available, U.S. container ports handled 1.38 million TEUs, a 0.6% increase over the same month last year. Total U.S. containerized imports are expected to increase 1.2% during the first half of 2013. (Source: NRF/Hackett Associates).

• U.S. containerized exports totaled more than 1.07 million TEUs in March, the highest monthly volume since March 2012. March containerized exports were 6% higher than the previous month. (Source: PIERS).

Modes

Trucking:

• The trucking industry lost 3,500 jobs in June after posting a loss of 700 in May. The trucking workforce decreased 0.05% over the previous month and increased 3% over the previous year. (Source: U.S. Bureau of Labor Statistics).

• The ATA’s seasonally adjusted cargo index rose 2.3% in May after falling 0.2% in April. The for-hire truck tonnage index rose 6.7% year-over-year, the largest year-over-year gain since December 2011. (Source: American Trucking Association | Trucking.org).

• The spot market for truckload freight in June rose 2.4% compared to the previous month, and was 4.7% lower year-over-year. Truck capacity fell 18% for the month, and was up 13% year-over-year. (Source: DAT Trendlines | www.dat.com).

Rail:

• Railroad bulk carload freight in June 2013 rose 1.2% from May 2013. Freight traffic in May fell 0.3% from June 2012. Carloads excluding coal and grain increased 3.8% over the previous year. (Source: AAR.org)(Report includes rail car-loadings by 19 different major commodity categories as well as intermodal units).

• Intermodal rail traffic in June 2013 was 1.3% higher than in June 2012 and 1.4% higher than May 2013 totals. Intermodal loadings have experienced year-over-year gains for 43 straight months. (Source: AAR.org)(Report includes rail car-loadings by 19 different major commodity categories as well as intermodal units).

Air:

• Global air freight traffic in May increased 0.8% from one year ago, and rose 0.1% from the previous month. North American air freight in May fell 1.2% year-over-year. (Source: IATA.org) (Global air freight covers international and domestic scheduled air traffic. North American traffic includes only domestic freight traffic.).

• In May, the index of East-West air cargo rates fell 1.9 points from April. The average price of air cargo leaving the United States in May stood at $3.15 per kilogram. (Source: Drewry) (The Drewry East-West Air Freight Price Index is based on the average of rates ($US per kg) for airfreight services on 21 major East-West routes.)

Ocean:

• Import shipment volume, in TEUs, at U.S. ports increased 3% in May from the previous month and fell 2.2% year-over-year. U.S. vessel imports in May increased for the second consecutive month and are the highest since last August. The number of bills of lading, or total shipments, filed with U.S. Customs totaled 786 thousand in May, up 2.5% from April. (Source: Zepol Corporation | zepol.com).

Warehousing:

• The U.S. average industrial vacancy rate was 8.68% during Q1 2013, down from 8.89% in the previous quarter.

• In Q1 2013, warehouse and distribution rental rates in the U.S. averaged $4.77 per square foot. (Source: Colliers International).

Purchasing Managers Index:

• The National PMI rose 1.9 points to 50.9 in June 2013. New orders rose 3.1 points to 51.9 and production increased 4.8 points to 53.4. (Source: Institute for Supply Management) (The PMI combines data on new orders, inventory, production, supplier deliveries, and employment. A reading above 50 indicates that the manufacturing economy is generally expanding.)

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