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April 12, 2010 3:00 AM, EDT

Trucking Jobs Increase Slightly During March, Labor Dept. Says

Employment Also Grows in Manufacturing, Retail
By Rip Watson, Senior Reporter

This story appears in the April 12 print edition of Transport Topics.

Trucking employment rose slightly during March, the U.S. Labor Department reported, amid growing signs that job growth could accelerate in months ahead as the United States emerges from the recession.

Labor’s report showed that trucking employment totaled 1,229,700 in March, 600 more workers than in February.

The growth was part of a jump of 162,000 non-farm jobs last month that included higher employment in the manufacturing, construction and retail industries that depend on trucking.

Overall, the U.S. unemployment rate remained steady at 9.7%.

“Companies in trucking are seeing that in the not-too-distant future that they will have to ramp up to get drivers back and add equipment,” Bob Costello, chief economist at American Trucking Associations, told Transport Topics on April 6. “The first place fleets will do that is in the driver recruitment and retention area. They will get those departments out there and running again before they add trucks and drivers.”

Greg Finzen, recruiting director for Hirschbach Motor Lines, East Dubuque, Ill., told TT on April 8 that the company “absolutely” had stepped up recruiting efforts as the driver applicant pool is shrinking.

“We are seeing an increase in freight and an increase in demand for drivers to haul that freight,” Finzen said. “We have seen a decline instead of an increase in the number of calls, and applications have dropped dramatically.”

Hirschbach responded by stepping up its print and Web advertising and enhancing its tractor lease/purchase program in an effort to add drivers to its refrigerated fleet, which runs between 400 and 500 tractors.

Other carriers already are moving in that direction by stepping up recruiting efforts (3-22, p. 1).

ATA’s Costello warned that a single month of employment data does not equal a trend, since the data are preliminary and subject to revision.

That fact was reflected in the seesaw pattern of trucking employment that rose slightly in January and then slipped back in February. The March total was preliminary and is subject to revision.

Trucking employment fell 5% to 1,293,400 from March 2009.

“Carriers have gains that are available in capacity utilization before they have to add trucks,” Costello said. “We have seen some nice gains in business, but they have been able to absorb that with the existing fleet and staff.”

ATA’s tonnage index gained 3.5% in the first two months of the year, and Costello he expects strong growth in March, as well.

Manufacturing, construction, wholesale and retail hiring accounted for more than one-third of job growth, with the rest coming from health care and government work, including temporary Census workers.

Officials in the manufacturing and construction industries, where recent carrier and analyst comments have indicated truck volume is increasing, saw positive signs in the latest report but voiced some caution.

“While manufacturers have not increased payrolls in three successive months in nearly three years, most of the increase was concentrated in two industries — fabricated metals and machinery,” said National Association of Manufacturers economist David Huether in a statement.

“With capital goods exports rising at an annual rate of 15% over the last six months, much of the rise in manufacturing jobs is likely being driven by export growth and does not indicate an across-the-board manufacturing recovery,” Huether added.

“This upturn was shared among all three nonresidential categories — building construction, specialty trade contractors, and heavy and civil engineering construction,” said Ken Simonson, chief economist for The Associated General Contractors of America, who noted that the job growth was the first in almost three years. “Both nonresidential and residential construction employment remain lower than in January, suggesting some of the pickup may have been a short-term rebound from exceptionally severe weather in February.”

On the brighter side, U.S. manufacturing rose at the fastest rate in more than five years, the Institute for Supply Management said. That index stood at 59.6 in March, up from 56.5 in February. Readings above 50 signal expansion.

The Census Bureau in a separate report said manufacturing rose 0.6% in February, on top of a 2.5% increase in January.

Other sources also painted a brightening picture.

Business Roundtable on April 7 released a survey of chief executive officers that found for the first time in two years more companies planning to hire new workers than to cut jobs.

That survey also found that nearly 90% of those executives are expecting economic growth in the next six months, a level of optimism that is double the pace in a survey done in the third quarter of last year.

In addition, the March index of freight activity published by Cass Information Systems, St. Louis, Mo., found that freight shipments rose 7.6% in March over the same month of last year and spending on freight rose 12.7% over the same period.

The banking company bases its monthly index on freight bills it processes for carriers and shippers.