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Trucking, Logistics Hiring Rebounded in July

Aug 12 2016

Transportation and warehousing companies returned to adding jobs in July, with trucking operators increasing their hiring after shedding thousands of jobs in recent months.

Trucking companies added 1,700 jobs last month, the U.S. Labor Department said Friday—reflecting recent growth reported in the manufacturing sector—although the industry is still down 5,600 jobs from a year earlier. Rail transportation, which has cut 27,400 jobs since last year amid a steep decline in coal and energy shipments, cut 300 jobs.

Logistics industries that heavily support e-commerce continued to grow last month as an increasing number of consumers shop online. Warehousing and storage companies added 2,600 jobs for a total of 48,100 over the last year. Courier and messenger firms increased payroll by 1,800, for a total of 18,600 over the last year.

The overall logistics and transportation sector added 11,700 jobs for the month, led by an additional 4.400 jobs in passenger transportation.

Analysts said there is some stabilization in the trucking market, which had struggled with overcapacity in recent months as weak manufacturing activity, modest growth in consumer spending and high inventory levels dampened shipping demand.

Recent reports on trucking volume and pricing suggest demand is recovering this summer. Jason Seidl, an investment analyst at Cowen & Co., wrote in a research report Friday that one carrier executive at a meeting this week “went as far to say that there ‘was enough freight to go around for everyone.’”

The gains come amid robust growth in the overall labor market, which added 255,000 jobs to nonfarm payrolls in July, the best two-month stretch of hiring so far this year.

Good-producing industries accelerated their growth, adding 16,000 jobs after growing by 5,000 jobs in June, according to adjusted numbers. Manufacturers added 9,000 jobs last month after adding 15,000 in June.

The Institute of Supply Management said its manufacturing activity index declined to 52.6 in July from 53.2 in June, meaning U.S. factories are growing, albeit at a relatively slow rate, as exporters continue to have a hard time because of the strong dollar.

And most job gains continue to be in the service sector, which has less upside for freight transportation. Professional and technical services added 37,000 jobs, and healthcare added 48,000.

“Two months of very modest growth in manufacturing jobs is certainly better than negative territory, where we’ve been much of the past year,” said Scott Paul, president of the Alliance for American Manufacturing, in a statement Friday.

By Loretta Choa, via The Wall Street Journal

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