Despite Everything, Shipping is Still Bullish
This Spring, there had been considerable concern in the United States regarding the resiliency of the shipping industry's meteoric success, particularly in the United States. That fear was triggered by a negative jobs report in which hiring slowed considerably. Other factors globally, such as a trade war with China and instability of the European Union furthered the uncertainty.However, this month has seen indicators that have assuaged much of those fears.
Logistics Hiring is Back at Record Highs
Over the last 12 months, logistics hiring has consistently been strong, even bucking the trend when overall hiring slowed. This Spring, though, saw a significant decline in those numbers - causing some experts to sound the alarm of a potential long-term slow down in both shipping and the overall economy.However, the most recent jobs numbers for June have shown that what we saw in the Spring may have just been a blip.Some details about the positive numbers include:
- Couriers and Messengers: 6,500 jobs
- Trucking Fleets: 4,300 jobs
- Overall Upward Revisions for Trucking Employment in the Last Two Months
While these numbers aren't as hot as those from 2018, that was never a realistic possibility to begin with.Other positive indicators that further back-up the bullishness:
- Warehousing and transportation employers focused on freight and parcel business added 14,900 jobs from May to June
- 224,000 additional overall jobs added last month
- Goods-producing firms: 37,000 jobs
- 17,000 additional jobs in a manufacturing sector closely tied to trucking demand.
European Carriers See High Demand
While the US economy felt a bit unsteady this Spring, other markets globally had far more to worry about. Europe, in particular, has been dealing with a level of uncertainty that dwarfs anything seen on this side of the Atlantic.With the emergence of the tumultuous Brexit vote and the difficulties that have followed, as well as the rise of anti-EU parties in other parts of Europe, the stability of the European Union has been a major issue.However, all of that notwithstanding, good news does seem to be on the horizon. Recently, DHL Freight Europe announced that they would be implementing a peak season surcharge of 4%, due in large part to increased demand, low capacity, and a shortage of drivers.The surcharge will be effective from September through December 2019 and will apply to all Full-Truck-Load, Partial-Truck-Load, and Less-Than-Truck-Load in Europe.This projection of high demand can be seen as a bellwether of the European market, at least in the short term.
Lingering Uncertainty
While there have been some very positive indicators lately, significant risks for shipping still exist. In terms of global trade, the tensions that exist between the United States and China are a real drag on the overall shipping eco-system. Though there have been periods in which it seemed that the trade war may finally be overcome, the current situation is pretty negative - there does not seem to be a deal on the horizon in the near term.
