Is adding 20,000 trucking jobs in just three months a lot of jobs or is it falling short given the current state of the freight market?
That is a question that was raised byAaron Terrazasof Convoy in analyzing the monthly employment numbers released Friday morning by the Bureau of Labor Statistics. It’s notable in light of the fact that the national average seven-day dry van rate published by Truckstop.com (and available in SONAR) has now solidly broken above the $3-per-mile mark and is starting to approach a doubling of where it was at its recent low of early May.
“Today’s trucking employment numbers were better but still not enough,” Terrazas, director of economic research at Convoy, told FreightWaves in reviewing the numbers. “There was an accelerated pace of hiring at trucking firms in November, but the fact that employment is still so far below year-earlier levels suggests a combination of hiring headwinds (it takes time to get drivers trained up) and firms still skittish about the long-term outlook for demand.”
The falloff from last year is striking given how much stronger the market is. The SONAR outbound tender volume index Friday morning stood at about 16,200. A year ago, it was about 10,230.
In November 2019, the number of jobs listed in the truck transportation sector was 1,529,800. This year, in the latest report, it was 1,474,400, a decline of 55,400 jobs.
Those jobs are not all truck driver jobs. The sector is described as “truck transportation,” so it includes all back office positions as well. Still, a drop of that magnitude in a market that by one measure is almost twice as good as last year is a remarkable shift.
It also does not include independent owner operators. As Terrazas noted, “the report only includes payroll employment based on the employer’s category. It’s not “trucker jobs’ but rather ‘jobs at trucking companies.”
The recent increase in jobs is still at a significant pace. The three-month increase of 24,900 jobs is the most in the BLS data series for a three-month period going back to 2010. But it’s tougher to climb back than it is to crater on the way down; the three-month total of job loss in April and May exceeded 90,000 jobs, and it was still running at a roughly 85,000 three-month loss total into June.
For those workers who are counted by the BLS, things got better financially. Earnings in the truck transportation sector (as opposed to trucking and warehouse, of which truck transportation is a subsector) saw the average hourly wage climb to $27. That is the first time it has ever reached that level and its year-on-year gain of $1.36 per hour is the largest in the history of the data series, going back to 2010.
There are other pieces of data released by the BLS that show how strong the market is. For example, the producer price index for the truck transportation sector was at 146.9 in October, up from 143.8 in September. (Data for November is not available yet.)
However, even though the average hourly wage might be at a record, the PPI for the truck transportation sector is not. At 146.9, it’s 0.7 points above a year ago, but is less than November and December of last year. It’s also at the same level of November and December 2018. January 2019 was the highest on record, at 147.1.
The warehousing and storage sector continues to rack up significant growth. The number of employees rose by 36,800, to 1,304,900. Since last year, that sector has added more than 112,000 jobs. The warehousing jobs alone accounted for more than 15% of all total jobs added.
Wages in the warehousing sector edged up to $21.14/hour, an increase of 9 cents from a month earlier. It still has not gotten back to the $22.01 level of May or even the $21.27 level of June.
The overall employment in the transportation and warehousing sector, which are all the job classifications under the NAICS system that begin with 48 or 49, was up 145,000. But the gain in production and nonsupervisory employees was 158,300, suggesting that it is frontline workers like those behind the wheel and those in the warehouses that are accounting for the bulk of the hires.
The total gain in the transportation and warehousing sector accounted for well over half of the total 245,000 jobs that the BLS reported the U.S. added last month. However, the unemployment rate in the sector rose slightly to 9.0% from 8.9%. It was 13% in August.
Terrazas also noted that job recovery for women has been slower in trucking as it has been nationally. “Employment among women at trucking firms has recovered at about half the pace of employment among men,” he said.