Trucking Bloodbath: 2,500 Truck Drivers Lose Jobs

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At least 2,500 truck drivers have lost their jobs in 2019 as the transportation 'bloodbath' unfolds

Alleged Truck Driver Shortage

Flashback February 11, 2019: NPR says Facing A Critical Shortage Of Drivers, The Trucking Industry Is Changing.

Amusingly, such nonsense persisted even last month.

Flashback June 13, 2019: Will the Trucker Shortage Continue in 2019?

​Will the shortage continue into 2019? All signs point to yes.

Transportation Bloodbath

With the above silliness out of the way, please consider Transportation 'Bloodbath' Unfolds

Truck drivers are suffering in 2019 — especially those who own or work at small businesses.

Rates in the spot market, in which retailers and manufacturers buy trucking capacity as they need it rather than through a contract, sank by about 18% year-over-year in June. That has caused truckers like Demetrius Wilburn, a Georgia-based driver, to find themselves unemployed.

Wilburn bought his semitruck four years ago after years of working as a company truck driver. But amid rock-bottom rates, Wilburn wasn't able to make a payment one month — and his truck was repossessed.

​Truckers' Fears at Recession-Level Highs​

Business Insider reports Truckers' Fears Have Soared to Recession-Level Highs.

According to Morgan Stanley's regular freight survey, rate expectations are sinking into the negatives — "well below 2016 levels." That was the most recent time freight sank into recession.

Freight rates have dipped year-over-year for six months straight. Loads on the spot market, in which retailers and manufacturers buy trucking capacity as they need it, rather than through a contract, fell by 50.3% in June year-over-year.

Alleged Shortages

At the peak of every cycle there is always an alleged shortage.

Anyone recall the "shortage" of Florida condos and housing in 2007?

Reality Sets In

Hello. About that alleged truck driver shortage ...

I never bought into the truck driver shortage thesis. In fact, I frequently stated millions of driver would lose their jobs due to automation. Today's news is not even a down payment.

Also, please consider my post from earlier today: Recession Looms: Cass Freight Index Negative for 7th Month

Shortage of Common Sense

There is no shortage of trucks or truck drivers. But there is a shortage of common sense starting with the Fed.

Deflation Coming

Repossession of trucks and inability to pay back loans is a major thing. Debt Deflation is Coming.

Finally, please don't count your chickens on that alleged "longest expansion in history".

The NBER is the official arbiter of recessions. It's possible we are in one right now. If so we may not know for a year.

The point is moot as a month or two here or there is irrelevant.

This isn't: When you blow bubbles, they eventually collapse.

Congratulations Due

Meanwhile, heading into recession, if not already in one: Congratulations Debt Slaves! You Owe the Banks a New Record Amount of Money.

Good luck with that.

Mike "Mish" Shedlock

Comments (16)
No. 1-12
Tengen
Tengen

Stories like this are why people who allege "worker shortages" or willingly believe BLS numbers should be questioned. If we're in such dire need of labor, why is the majority of the US population outside the labor force, even by BLS statistics? We're not a nation of children and elderly people. Also, why aren't wages rising in this supposed shortage?

The reality is that we're living in a debt-fueled bubble with no endgame. Truckers, along with a lot of other groups, are in for a rough ride. Good thing everybody's learning to code!

Nasty Edwin
Nasty Edwin

Just wait until the Corporate debt bubble gets popped. This is just the beginning. I am stocked up on popcorn to watch the show

HubbaBuba
HubbaBuba

A good-hearted rural bank President (who dealt w/ all kinds of loans) once implored on me that these truckers have some of the worst economics to live with. If times are good they can scrape by, on the down cycle, they can't pay their bills and loans. It's a total "we're here to use you" type of job life. As I heard ~ 25 yrs ago as a PM, in cyclicals EVERYONE MANAGES FOR THE UP CYCLES! No one knows crap about how the down cycles will play out - nor to plan for them. That's why the (i.e.) chemical stocks are "rented - not owned".

Greggg
Greggg

bradw2k
bradw2k

That Yahoo! News (really?) article looks a bit hokey, and the Business Insider link doesn't work. In any case, I get no sense of a "bloodbath" being reported by DAT: https://www.dat.com/blog/category/rate-trend-of-the-week

CCR
CCR

Long time friend of mine says the truck tire factories are working in 3 shifts. Mid-West tire factory. Crops are historically late this year as well, could be a factor or not. Just doing some quick math. 2,500 truckers out of 3.5m, is about 7 bips. I guess if 2500 truckers a month are losing jobs, over a few years that is material.

Sechel
Sechel

My dad was an independent truck driver who owned his own company. He was local and short haul. It's been tough for truck drivers for years. First they've been losing out to UPS and Fed Ex and packages, in his case textile kept getting shipped in more and more efficient patterns that bypassed the local truckers. Trains got more and more of the business as well.

Webej
Webej

Whenever people complain of shortages and start clamoring that "something" needs to be done, it is absolutely axiomatic that they are not thinking: "It's a free society: If you really want somebody (or something), offer a little more money (or similar incentives)."

Ted R
Ted R

Obviously the U.S. is in a rapidly contracting economy and it is just beginning. Call it a deflationary cycle or a slowdown or a recession or whatever. The debt cycle is beginning to unwind and it won't be pretty. A falling stock market can't be far behind.

lol
lol

What's not closing or goin out of business?Now that would be a story!Sure trucking but the reality is everything not dependent on a govt check,govt handout,govt subsidy,govt contract is closing!

RonJ
RonJ

"But there is a shortage of common sense starting with the Fed."

Maybe it is an abundance of fear. After WW1, the 1921 recession saw the biggest quarterly GDP drop on record. In the 1930 recession, Hoover became the father of the New Deal, intervening in the natural correction of a roaring 20's economy.

We have come full circle and the FED/government are trying to stave off another 1930's meltdown. Thus, the housing bubble followed the .com stock bubble. The ZIRP bubble followed the housing bubble. Waiting in the wings is the MMT bubble.

If everything imploded, there would be serious civil unrest. Last time around resulted in the Tea Party and Occupy Wall Street.

Six000mileyear
Six000mileyear

Fewer truckers is consistent with decreasing train freight volume. When nothing is moved from point A to B, then it can't be moved from point B to C.