Employment and wages continue to grow in trucking industry

August 6, 2021

Tyson Fisher

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Trucking employment experienced a moderate boost in July, with the transport sector as a whole experiencing a more significant increase.

Trucking employment went up by more than 3,000 jobs after gaining more than 6,000 in June. Although that number is moderate over the past year, it is larger than years prior to 2020 as the trucking industry continues to fill voids left during the peak of the pandemic. Revised data has May showing a decrease of 1,800 jobs after initially reporting a loss of more than 3,000.

Employment numbers for July and June are preliminary.

The trucking subsector had a net loss of 42,500 jobs in 2020. This is far from the largest annual decrease. In 2009, more than 100,000 trucking jobs were lost, preceded by employment being down by 76,500 jobs in 2008 during the Great Recession. In 2001, another recession year, trucking jobs fell by more than 49,000.

Compared to the end of 2020, trucking employment is up nearly 13,000 jobs. At this time last year, there was a decrease of more than 85,000 jobs after the trucking subsector experienced its biggest monthly loss since tracking of the subsector began in 1990 due to the pandemic. April 2020 was hit the hardest by the pandemic because of new stay-at-home orders nationwide, causing businesses to shut down or modify operations.

Resulting job losses in trucking erased more than five years of trucking employment growth. However, May 2020 was the start of a nine-month streak of increases. Before the pandemic, the last time trucking employment was at current numbers was in May 2018. Last April, those numbers dipped to numbers last seen in fall of 2014.

In its analysis of the employment report, online freight network Convoy points out that wages in the transportation sector are rapidly increasing.

This could indicate the trucking industry is not recruiting new drivers.

“It’s important to note that this metric on average wages can be easily misinterpreted: Strong wage gains with lackluster headcount gains means that trucking firms are bidding against each other for the same workers or are handing out raises as a proactive retention strategy,” Aaron Terrazas, Convoy’s director of economic research, stated in his analysis. “Slower growth in average hourly earnings combined with payroll growth might actually be a good sign for the trucking industry: It would indicate an influx of less experienced workers to the labor force.”

Regardless of the increases, wages are still falling behind. Consequently, higher starting pays and larger raises may not be enough to retain drivers.

The transport sector experienced a significant gain of nearly 50,000 jobs, according to the Bureau of Labor Statistics. Last month’s report showed employment was up nearly 11,000 jobs in the sector. Revised data now puts that number at nearly 20,000.

All but three of the transportation subsectors experienced gains, with transit/ground passenger transport gaining the most (18,800), followed by warehousing/storage with 10,700 more jobs and 8,100 additional jobs for couriers/messengers.

Minor losses were felt in rail transport (minus 800), water transport (minus 300) and scenic/sightseeing transport (minus 100).

The transportation sector experienced a job loss of nearly 93,000 last year. Like trucking employment, the transportation sector as a whole had worse years in 2009 (minus 273,800), 2008 (minus 153,800) and 2001 (minus 235,700). Year to date, the transport sector is up more than 114,000 jobs. This time last year, transportation jobs were down by more than 375,000 because of the pandemic.

Average hourly earnings for the transportation and warehousing sector were $26.88 for July – an increase of 23 cents from the previous month. Earnings were up by $1.52 from July 2020 after wages plummeted last year after a surge in the unemployment rate. Hourly earnings for production/nonsupervisory jobs were up by 21 cents to $23.96 and increased by $1.46 year to year. Average hourly earnings for private, nonfarm payrolls across all industries were $30.54, an 11-cent increase from the previous month.

The unemployment rate for transportation and material-moving occupations remained stagnant at 8.6% compared with June. At this time last year, the unemployment rate in the transport sector was sitting at more than 15% due to the pandemic.

Overall unemployment fell by 0.5 percentage points to 5.4% after the economy gained 943,000 jobs in July. The jobless rate is still up 1.9 percentage points from last February, just before the implementation of stay-at-home orders. However, unemployment has fallen by about 9.5 percentage points since last April. LL