If the US trucking industry were a country, it would rank top 50 in GDP every year. The trucking industry is generating billions of dollars and is not only responsible for more than 5% of all the full-time jobs in America, but an astonishing 70 % of all the freight moved in the country. With the industry being so large and powerful, there are certainly more than one aspects influencing its market every single year. Let‘s take a look at some of the key factors affecting the trucking market in the year 2019.
Table of contents: Driver Supply Shortage Growing Trucking Rates & Driver Wages Geopolitical Turbulence
Driver Supply Shortage
As the industry continued to operate in the deficit of drivers in 2018, this year it is still same news. Despite the efforts and better incentives to draw new drivers the strong shortage continues to increase from 60,000 in 2018 to 70,000 in 2019.
Businesses that are dependent on truck shipping, should be more than aware that driver shortages continue to contribute to a sporadic shortfall of available trucking capacity. The driver shortage, including the problematic driver retention, is expected to remain a primary concern for the trucking industry not only this year but for more years ahead.
According to the ATA and the latest driver statistic, the problem is slightly improved, yet ATA still estimates that the industry is short for more than 50,000 drivers.
Growing Trucking Rates & Driver Wages
Trucking rates were rapidly rising up to 30% in spot markets last year in 2018, however from the first quarter of 2019, spot rates had fallen and capacity has improved.
In 2018 driver wages grew at strongly compared to previous years, all on different levels based on the region, and truck market, but the general trucker pay was up around 10% on average over the year.
Raising wages and making higher pay and better benefits for truckers serves the main goal – to reduce the truck capacity shortage and draw new drivers to become truckers.
Unfortunately, an increase in driver pay translates immediately to similarly higher rates for shippers. Both driver wages and trucking rates are expected to go up about 3 to 5% on average in 2019.
Geopolitical Turbulence
Turbulent U.S. domestic politics has a tremendous impact on the trucking market while being also influenced by the ongoing global trade wars that are pushing shippers to make difficult decisions regarding their operations and supply chain.
In 2019, factors like the US-China Trade War, Global-National Regional Economies, e-commerce, and the political climate could each affect import volume and its associated shipping requirements.
Not to mention that many manufacturers have built their supply chain over a span of decades and will find it challenging to establish new supply chains and avoid costly tariffs.
Truck Market Demand Growth Slowing Down
Economic and political volatility are both contributors to a reduction in shipping volume in 2019 as expected. According to economists, a slowdown in the last quarter of 2018 indicates that the demand growth rate is expected to decrease in 2019. But even with a slowdown in growth, 2019 shippers will face significant worries.
2019 will remain a tough year to be a trucking buyer and 2019 will continue to be a more expensive and much more challenging period to bring goods to market. Shippers will have to continue the search for ways to significantly improve areas such as truck utilization, network operating costs, find new and different types of capacity, and reduce loading and unloading cycle times and beyond.
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