Truckload growth will average 4 percent or more through 2013, while the driver shortage will continue for years, forecast an FTR Associates economist today.
A worsening driver shortage and other factors should cause labor costs to rise in the next few years, said Noel Perry, FTR senior consultant.
Trucking growth will be about double the GDP growth rate, he said. Predicted growth in the service sector, which accounts for 80 percent of the total economy, could lead to an increase in consumer spending this year and next, he noted.
The driver shortage resulted from a “cyclical drag,” which is the industry’s inability to recruit and employ drivers fast enough, and a “regulatory drag” brought on by new government rules, Perry said. Today’s shortage of about 200,000 drivers will increase to around 800,000 drivers in 2014, he estimated. That is less than previous forecasts “but still a big deal,” he said.
The FTR consultant forecast freight rates increasing 5 percent to 6 percent annually through 2013. That will be due to rising fuel prices, introduction of new equipment that’s more expensive than in recent years and increased labor costs. Perry said he expects fuel prices to fall this year if the standoff with Iran settles down.
Asked for an outlook on hours of service, Perry predicted that courts will allow implementation of regulatory changes, as they did during the rule’s last alteration. He noted that Federal Motor Carrier Safety Administration Administrator Anne Ferro intends to push for a cutback on daily driving time to 10 hours from 11. “As soon as she gets research evidence that this change is required, she’s going to publish a regulation,” he said. “There is a lot of uncertainty.”