Supply Chain Blog
The world is being a little crazy during this government shutdown, yet the world still turns and commerce continues. Consumer prices inch up, employment is solid, incomes are growing, and the economy is slowing somewhat. Due to the government shutdown, some agencies are unable to issue recent economic numbers.
Carrier capacity has loosened a little as we head into the first quarter and industrial warehouse space availability has tightened.
Let’s look at the numbers.
Happy New Year to you all!
2019 begins with turmoil from the ongoing trade war with China, stock market volatility, Democrats taking control of the House, and retailers figuring out who the winners and losers were after a great shopping season. The government shut down underway, we won’t be getting numbers from the Labor or Commerce Department nor the Census Bureau. We will get by nonetheless.
What can we expect in 2019? I’m not one for a lot of predictions so I’ll be brief before getting to some of the current economic numbers.
- Political wars – With the Dems now in charge of the house there will be political battles over investigating Trump, the Mueller investigation, immigration and winding down the wars in Syria and Iraq. The only likely thing to get done is infrastructure and a fight to replace Obamacare with a system that includes preexisting conditions.
- Data mining and artificial intelligence will continue to develop creating predictive systems to assist in planning for about everything: routes, inventory, labor planning, etc. The Internet of Things (IOT) coupled with advances in robotics in the distribution center will create greater visibility and drive labor productivity.
- Autonomous vehicles are still a ways off, electric tractors will progress more quickly, and the use of platooning trucks will start getting some traction as demonstration projects.
- Driver recruitment and retention will continue to be challenging at for-hire and private fleets. This rising driver compensation puts continued upward pressure on freight rates. An infrastructure bill will make the driving situation even worse as construction worker needs will pull from the truck driver employment pool.
- Freight trends are slowing as we enter the New Year, it may be hard to pass on these higher freight rates. 2018 will be seen as the high-water mark for trucking.
Now let’s look at some numbers.