Have you heard? Economic activity sprang back to life in the third quarter. Despite a cantankerous election campaign that seemed to remind us by the day how terrible things are, we’re doing quite well.
Judging by the most recent GDP numbers, America is on fire. The widest measure of how we are doing, our nation’s GDP, expanded by an impressive 2.1 percent. Certainly, this doesn’t mean we should all start dancing in the streets, but there’s nothing wrong with a little room for optimism. There’s been plenty of uncertainty to go around, and numbers like this keep a restive industry calm. So, what’s next?
The Economic Data
Per the American Trucking Association’s Chief Economist Bob Costello, the economy is currently at “a turning point” and that economic conditions are ripe for expanded growth.
Another bright spot lies in the job market. Job growth continues to rise in the third quarter, as unemployment statistics drop. On the job growth side, there are multiple arguments. Some expect the growth to continue and the economy to continue to expand, other’s say it’s likely that growth will decelerate.
Dig deeper into the numbers and you can see that some parts of the economy that had been a drag in the previous few quarters had rebounded. One example is the oil and gas sector, which appears to have recovered a bit from its bottom.
Research firm HIS Markit reported on the manufacturing sector, which showed a rebound from the three-month low it sat at in September. With numbers improving across the board, this could signal a broad-base upturn in broad market economic conditions. This means only good things for trucking.
But are there areas of concern? Certainly. Consider that even with the solid third-quarter bump, year-over-year GDP growth languished at a mere 1.7 percent. At the same time, last year, we sat at a modest 2 percent.
What we are seeing is a wide recovery, if not an all-out boom. Still, will we see an interest rate hike because of new economic policies, from both a new administration and unified Congress? Even so, don’t expect a large hike. No one wants to sink the economy when it seems to be finally picking up some steam.
Where Trucking Fits In
Trucking continues to play an important role in the health of our nation’s economic recovery. The trucking employment shortage has become almost old news. Yet trucking fills the roles as more and more people step into the cab.
Per a new Labor Department report, trucking was one of the industries that helped push our overall GDP number as high as it was. Nation’s unemployment rate sat at 4.5 percent.
Of those numbers, in-for-hire trucking saw a net gain of 4,700 jobs from the month before. Wider transportation and warehouse numbers rolled in at 7,500. Consider that these numbers were revised higher after the fact, and it’s not hard to see how the trucking industry plays a vital role in the overall health of our nation’s economy.
Still, it’s important to never get overconfident. We have seen 85 consecutive months of positive job creation. Some say that the job market has reached a saturation point; that the pace of hiring will inevitably slow.
Wage pressures are still minimal, so it appears there is still room for bottom line growth within the real economy. But capital goods numbers fell by 1.3 percent.
These are minor headwinds when compared to the overall level of economic growth. Trucking continues to play a vital role in our nation’s economy, and the numbers appear to look good for future growth.