Traditionally, “trucking has been the big winner when the economy recovers from a recession,” according to IBISWorld, which dubs itself the “nation’s largest publisher of industry research.”
In a report last week, the research company predicts that freight will rebound in 2012 as the economy returns to growth in line with recovering consumer confidence and increased spending.
In 2012, IBISWorld forecasts trucking revenue will increase 3.2% as consumers buy more physical goods, causing downstream industries to require additional shipping. As Americans release pent-up spending in 2012 and beyond, revenue will leap higher, IBISWorld predicts, and forecasts that revenue for the trucking industry will grow at an average annualized rate of 3.2% to reach $45 billion in the five years to 2016.
“The local freight trucking industry was particularly hurt in 2009, when revenue declined 14.9% due to reductions in consumer spending, construction activity and manufacturing production,” the report states. “Furthermore, a drastic reduction in diesel prices in 2009 caused revenue from fuel surcharges to decrease during the year. While revenue from fuel surcharges has since increased along with fuel prices, industry demand remains relatively weak. Consequently, revenue is expected to fall at an average annualized rate of 2.0% to $38.4 billion during the five years to 2016.”
In 2011 alone, IBISWorld predicts that recovering demand and increased fuel surcharges will increase industry revenue by 3.7%.
Single truck owner-operators have been the hardest hit by the recession, IBISWorld said. “These small firms, which generate 34.6% of revenue, were particularly susceptible to the recent decline in demand. Poor operating conditions caused many firms to record losses in 2008 and 2009, and some operators were forced out of the industry. In the five years to 2016, the number of firms is expected to decline by 0.5% annually to total 215,491. Similarly, reduced demand has also caused industry employment to fall 1.5% annually during the five years to 2011.”
According to IBISWorld analyst, Lauren Setar, predicts an economic upturn will exacerbate the truck driver shortage. “Trucking industries have struggled to attract enough drivers to meet demand prior to the recession,” according to Setar. “The recession's negative effect on demand has offset these staffing problems,” he says, but predicts as freight picks up the driver shortage will return and be a problem that will “continue during the next five years.”