Written by Wagner Logistics' Chief Customer Officer John Wagner Jr.

Hi Friends,

As the nation thaws from the artic blast, the number of workers seeking unemployment benefits fell sharply last week and a measure of consumer confidence jumped. In addition, we are getting positive news that the pandemic end may be in sight as we creep closer to herd immunity by early summer.

Add to this the real prospect of a 1.9 trillion-dollar infusion into the economy and we are looking at significant GDP growth in 2021.

The good news/bad news for the logistics industry is that consumers are going to spend putting more pressure than ever on the already constrained transportation industries. The real shortage of driver’s, capacity is in short supply and pricing will continue to rise in trucking, rail, air, and ocean sectors.

Let’s look at the numbers.

Hi Friends,

Well it’s been quite a month with political unrest, a new administration, and the pandemic going strong. With the vaccinations going into arms, let’s hope we reach herd immunity sooner than later.

Consumers are amazingly upbeat as confidence in the U.S. rose in January according to the Conference Board. Optimism has returned as expectations for the economy and the labor market improvement grow. The consumer confidence index rose to 89.3 in January from 87.1 in December.

2021 represents a new beginning for us all with expected economic expansion.

Meanwhile, the logistics markets are staying hot as carriers continue to command high freight rates, industrial real estate costs are elevated, and labor is hard to find.

Let’s look at the numbers.

Hi Friends,

While the pandemic rages along with Congress, the economy putts along and freight/logistics markets remain hot.

The balance of political power has shifted with Democrats maintaining control of the White House as well as both legislative chambers until at least November 2022, when the next midterm elections take place. Margins are razor thin meaning bipartisan support will be critical to developing and passing any major legislation, including a transportation and an infrastructure package.

As we begin 2021, we face a surge in coronavirus cases, new restrictions on business, cautious shopping and slowing economic growth. The number of workers filing for jobless benefits posted its biggest weekly gain since the pandemic hit last March and the head of the Federal Reserve warned the job market has a long way to go before it is strong again.

Let’s look at the numbers.

Hi Friends,

As we conclude 2020, I congratulate you all for your perseverance throughout the toughest year in my memory. We have gotten past the election, vaccines are out (within months we’ll be awash in them from multiple suppliers), and the economy has performed better than expected.

Before we get into the recent economic and logistics news, let me wish every one of you the happiest of holiday seasons. May you be granted health, prosperity, and hope in the new year with the people you love.

Hi Friends,

What a long, strange trip it’s been in 2020 as we have seen political theatre, a deadly pandemic, and a collapse in employment. We have regained more than half the jobs lost in the sudden downturn, consumer confidence remains high and spending is almost shockingly robust. Retail sales rose nearly 6 percent from the year before, despite the virus in October. Housing is booming, home prices are rising rapidly, and the stock market is setting new highs, all of which suggests that the next six to nine months will continue to see progress. 

This rallying prosperity is of no use to the 11.1 million Americans still out of work, or the unprecedented number of people lining up at food banks across the country. As we continue to dig out of the recession, job openings will increase, and employment will rise. Unemployment today stands at 6.9 percent, down from 14.7 percent in April.

In this recovering economy the logistics market is as robust as I can ever remember. Freight rates reflect the tight trucking capacity and parcel carriers are rationing their networks ability to pick up, sort, haul, and deliver packages. Despite high unemployment, distribution centers and trucking companies are finding it hard to hire.

I hope you had a great Thanksgiving and stayed safe and healthy. We are going to have to strap on our helmet to get through the remaining holiday season. Let’s look at some numbers.

Hi Friends,

The voting is over and while we wait for the run-off election in Georgia to determine control of the Senate, it appears the Democrats will control the House and Executive branches of government.

As I’ve said before, the U.S. economy is proving to be surprisingly resilient despite the pandemic that is picking up steam prior to the vaccine roll-out. Retail sales continue in the positive column while industrial production rises slightly. The service sector continues to suffer due to continued restrictions on restaurants and other establishments.

Despite the pandemic, the Biden administration will inherit the basis of a robust economy poised to rebound once Covid gets under control in 2021.

Capacity constraints continue to be a headwind for shippers as freight rates remain elevated. Industrial real estate (distribution center properties) continue to ask expensive lease rates and people are reluctant to go to work due to the virus and school shutdowns.

While all of this is happening the nation approaches Thanksgiving. A time when we traditionally gather with our families and friends to give thanks for our blessings. No doubt the virus will spread accordingly if people are not cautious.

Let’s look at the numbers.

Hi Friends,

As I write this installment of my blog, we have no clear winner in the race for President although it looks like the Republicans will hold on to the Senate and pick up seats in the House. Record turnout by voters in a pandemic make this a historical election regardless who comes out on top at the White House.

Whomever wins the Presidency, they will have a pretty good economic foundation in 2021 as a vaccine should help return the country to some semblance of normalcy. If the Senate moves R, I expect a smaller stimulus package post-election.

In the meantime, the logistics marketplace is going nuts as truckload capacity remains tight with scarcity driving up freight rates. Warehouse costs continue to rise with record absorption of new facilities coming online.

Labor costs remain high and workers hard to find. It strikes me as odd that with a high unemployment rate, staffing challenges remain. I can only attribute this to fear, generous unemployment benefits, or virtual schooling creating childcare issues. Regardless, with all retailers and parcel carriers looking to add hundreds of thousands seasonal workers, it’s going to be an immense challenge to attract and keep the volume of people that are needed.

Let’s look at the numbers.

Hi Friends,

As we inch closer to the election, I’m seeing pandemic fatigue, fighting in Congress over further relief, and a World Series being played on a neutral field for the first time in history. A bizarre year indeed.

Meanwhile consumers are spending while freight volumes have returned to 2019 levels. Carrier capacity remains tight and parcel carriers are warning of delays. Manufacturing took a step back in September after growing in the prior month.

Half of the people who lost their jobs in the government led shutdown have been rehired leaving millions still unemployed. A slow employment recovery is underway.

Apparently, holiday shopping has started as Amazon Prime members spent. Digital Commerce 360 estimates that Amazon Prime Day 2020 sales hit $10.4 billion, an increase from $7.16 billion (+45.2 percent) over Prime Day 2019.

Let’s look at the numbers.

Hi Friends,

As we kick off the fourth quarter jobs are slowly returning. The Bureau of Labor Statistics reported that the economy created 661,000 jobs in September. Over the last five months businesses have added 11.4 million people to payrolls, a record for such a short period of time. However, we have only recouped about half of the jobs lost in March and April.

For-hire trucking employment, including both truckload and LTL fleets, rose by 4,600 in September after increasing by 10,000 in August. Over the last five months, industry employment has increased by 23,800. So how does this match with the current tight capacity situation? Because the industry shed nearly 97,000 jobs in March and April. As a result, employment levels were off nearly 5 percent from September 2019.

While this DOL report doesn’t give industry employment by occupation, the majority of jobs in the industry are truck drivers. Industry employment is still off 81,000 since the peak in July 2019. Fleets are in dire need of drivers.       

The short story here is that the transportation capacity challenge is real, and pricing continues to climb accordingly. Without further stimulus to business and individuals there is the real possibility of this economy stalling.

Hi Friends,

The number of applications for unemployment benefits has held steady in September at just under 900,000 a week, as employer uncertainty about the economic recovery six months into the coronavirus pandemic continued to restrain hiring gains.

Jobless claims increased slightly to 870,000 last week from 866,000 a week earlier, according to Thursday’s Labor Department report. The totals remain well above pre-pandemic peaks but are down significantly from nearly seven million in March.

While employment holds steady, the freight market continues to sizzle. Retail is holding its own and manufacturing is finding its legs. The total business inventory-to-sales ratio, which includes manufacturing, wholesale, and retail, fell to the lowest level in July (data is lagged one month) since November 2014, meaning inventories are lean, which is helping truck freight volumes.

Let’s look at the numbers.