Despite concerns of an impending recession due to runaway inflation spurred by record high fuel prices, the economy continues to add jobs at a remarkable clip. The month of May proved to be no exception and the trucking sector was a major contributor to employment growth.
For the third time in the past four months, the transportation industry experienced a substantial boost in hiring, adding approximately 13,300 jobs to the sector in May, according to data cited by FreightWaves from the Bureau of Labor Statistics. That brings the total number of additional truck driving jobs on the year to roughly 1.5 million.
Transportation was one of several sectors that got a shot in the arm in May, as employers as a whole added 390,000 jobs during the month, BLS data showed. That figure was well ahead of the 325,000 jobs that economists had predicted for May, according to NBC News.
While some industries have encountered ups and downs in 2022 from a standpoint of employment, truck transportation has been fairly consistent. Indeed, with the exception of March, when the hiring slid by approximately 2,700, employment has risen every month for nearly two years, according to FreightWaves.
Raising wages is paying off
Much of the industry's success with hiring has been attributable to wage growth, as can be said for several other sectors as well. Retailers, logistics firm and many other industries that depend on truckers to deliver goods have increased the salaries for new hires as well as for those who have been with their employers for a number of years. Perhaps unsurprisingly, what a job pays is the No. 1 concern for Americans who are looking for alternative employment. In a recent survey conducted by EmployBridge, 39% of respondents cited salary as the most persuasive reason to leave their employer for another role, up from 32% who indicated as much in a survey carried out last year. The second most compelling motivating factor to look elsewhere for work was job security at 12%, which was unchanged from 2021.
Jason Miller, an associate professor of logistics at Michigan State University, told FreightWaves in an email that the 13,300 figure for May is "an incredibly strong number." At the same time, though, Miller said he isn't entirely convinced it derives solely from job creation.
"Part of me wonders if some of this could be due to self-employed independent owner-operators transitioning back to employees," Miller said. "[B]ut it is still a bit too early to tell."
What has diminished for the industry, if ever so slightly, is the amount of freight that truckers are hauling, with tonnage falling for the first time in eight months. In April, the most recent month in which data is available, the For-Hire Truck Tonnage Index dropped 2%, according to the American Trucking Associations' monthly assessment. That puts the index to 115.8, down from 118.2 in March. However, the index remains well ahead of where it was a year ago, up roughly 2% in April compared to 12 months earlier and 3.3% year over year in March.
ATA Chief Economist Bob Costello noted that the tonnage data primarily takes into account contract freight, as opposed to spot market. He added he expects contract freight to outperform spot market, but growth will likely be slower than in years past due to carriers having a hard time managing capacity.
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