May’s job loss in trucking not as bad as April, signaling a rebound

Editor’s note: In the May 2020 Employment Situation report, the Bureau of Labor Statistics noted it had incorrectly classified some laid off workers as a result of the COVID-19 pandemic as “employed, not at work rather” than “unemployed.” A footnote in the report stated that the misclassification may result in the overall unemployment rate being off by 3 percentage points, raising the unemployment levels to 16.3% in May, and 5% higher for the month of April. “BLS and the Census Bureau are investigating why this misclassification error continues to occur and are taking additional steps to address the issue,” the report states.

The U.S. economy slightly bounced back in May compared to a disastrous employment situation in April. However, the transportation section, including the trucking subsector, continues to take a hit.

The transport sector lost 19,000 jobs in May. Except for the nearly 600,000 jobs lost in April, May’s decrease is the largest since January 2017, when the sector lost nearly 26,000 jobs. Most subsectors actually experienced an increase. However, a massive job decrease in the air transport subsector pulled the sector down to a net loss.

The trucking subsector experienced a modest job loss of more than 1,000 after losing nearly 90,000 jobs in April.

April’s trucking jobs loss was the largest since the bureau began tracking the subsector in 1990. At a distant second, nearly 50,000 trucking jobs were eliminated in April 1994. That was likely the result of about 80,000 Teamsters going on strike after negotiations with Truck Management Inc. failed.

Numbers for May and April are preliminary.

Air transportation experienced the largest decrease with more than 50,000 fewer jobs in the economy. In a distant second is water transportation (minus 2,200) followed by rail transportation (minus 2,100). Six of 10 subsectors are experiencing job growth. Couriers and messengers added the most, with more than 12,000 more jobs. Trailing just behind is transit/ground passenger transportation with a gain of more than 10,000. That subsector bounced back in a big way after losing more than 185,000 jobs, the largest loss during a month of extreme losses across the board.

The trucking subsector had a net gain of more than 4,000 jobs last year, a far cry from the nearly 55,000 job increase in 2018. However, the employment situation last year is better than 2016’s loss of 4,000 jobs. To date, trucking employment is down nearly 95,000 jobs due to April’s downward spiral. At about 1.4 million jobs, this sets trucking employment back to numbers last seen in November 2014, erasing more than five years of job growth.

The transportation sector had a net gain of more than 118,000 jobs in 2019. Last year was the slowest year for growth since 2013 when transportation employment increased by only 77,500 for the year.

Average hourly earnings for the transportation and warehousing sector were $25.67 for May – a decrease of 8 cents. Earnings were up significantly by 89 cents from May 2019.

Hourly earnings for production and nonsupervisory jobs were also down by 20 cents to $22.80 from the previous month but up 27 cents year to year. Average hourly earnings for private, nonfarm payrolls across all industries were $29.75, a 29-cent drop from the previous month.

According to the report, the unemployment rate for transportation and material-moving occupations remained at 18% compared with April’s rate. This time last year, the unemployment rate in the transport sector was sitting at 5%.

Overall unemployment fell to 13.3% with 2.5 million jobs added to the economy as a whole. In April, unemployment hit nearly 15%, the highest unemployment rate since the bureau began compiling monthly data on the rate in 1948.

It is estimated that nearly a quarter of Americans were unemployed at the peak of the Great Depression. April’s loss was also the largest one-month job loss on record, which began in 1939. Aside from March’s loss of 870,000 jobs, the next largest loss came amid the Great Recession in March 2009 when employment was down by 800,000 jobs.