Industry Victories and Lingering Labor Woes
Amidst challenges, truckers enjoy success in D.C., safety
By Steve Brawner Contributing Writer
The economy is sluggish and the
driver shortage will only get worse, but motor carriers have enjoyed recent successes in Washington and in their safety efforts. Those were some of the high-
lights of a presentation by Pat Thomas, chairman of the American Trucking Associations and senior vice president for state government affairs for UPS, at the 2016 Arkansas Trucking Association Annual Business Conference & Vendor Showcase in Little Rock in May. Thomas said the motor carrier
industry faces a large inventory correc- tion caused by overproduction, which will slow future production until the excess inventory is cleared out. Freight volumes weakened in the latter part of 2015. For contract freight, revenue per mile grew in 2015. However, it also weakened later in the year, and the spot market is very soft. Carriers are using fuel cost savings to increase driver pay and to replace their fleets. The indus- try has not reached its capacity that it had prior to the recession in 2008-09. Instead, capacity is increasing due to slower demand. Overall, the economy is struggling
to get out of second gear. The good news is that job growth is solid, wages are modestly increasing and low gas prices will encourage consumers to spend. But the economy is in the midst of a signifi- cant inventory correction, and while the
ARKANSAS TRUCKING REPORT | Issue 3 2016
Pat Thomas, chairman of the American Trucking Associations, speaks at the Arkansas Trucking Association Annual Conference in May
PHOTO: Jon D. Kennedy
outlook is good for U.S. factories over the long term, manufacturing is soft at the moment. The gross domestic prod- uct, which grew at 2.4 percent in both 2014 and 2015, grew only .5 percent in the first quarter of 2016 but is expected to grow 1.7 percent for the year and 2.7 percent in 2017. The probability of a recession occurring during the next six months has increased by 25 percent, though it’s still unlikely.
TRACKING SUCCESSES In an interview with Arkansas
Trucking Report, Thomas summed it up
by saying, “The 30,000-foot level is that we’re growing at a disappointingly slow rate, and there’s nothing to signal that the near-term future, you know the 90 days or 180 days, that that’s going to change.” As discouraging as most of that
news is, the motor carrier industry has enjoyed a pretty good run recently in Washington. The biggest success was the passage of the Fixing America’s Surface Transportation Act, or FAST Act, a five-year, $305 billion federal trans- portation law that includes $225 billion
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