American Trucking Associations Chief Economist Bob Costello told the annual ATA Management Conference & Exhibition that freight volumes in the trucking industry continue to grow, but the looming driver shortage could hold back industry growth.
“Freight volumes are growing nicely on a year-over-year basis for most trucking sectors as economic growth remains solid,” Costello said here during a panel discussion titled The Economy and Its Impact on Trucking.
Costello was joined on the panel by economists John Felmy of the American Petroleum Institute, Jack Kleinhenz of the National Retail Federation and Chad Moutray of the National Association of Manufacturers.
“Industry revenue and average revenue per mile are increasing nicely as capacity remains constrained,” Costello said. “However, the industry is having a difficult time adding trucks due to the driver shortage.”
Costello said the shortage was “as bad as ever and is expected to get worse in the near term,” as freight volumes continue to grow.
As evidence, Costello reported that turnover – often a proxy for tracking the driver shortage – rose 11 percentage points to an annualized rate of 103% in the second quarter. The increase set the rate at its highest point since the third quarter of 2012.
Turnover at small truckload fleets – fleets with less than $30 million revenue – surged 16 points to 94%, the highest level since the third quarter of 2012.
“These turnover rates show that the shortage is acute,” Costello said, “and if the freight economy continues to grow, it will worsen very quickly.”