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ATA Economist Bob Costello Says
NASHVILLE, Tenn. — The freight market is as strong as it has been since deregulation in the 1980s, according to American Trucking Associations Chief Economist Bob Costello.
Speaking at the NATSO Connect conference here, Costello said that anecdotal fleet reports suggest January 2018 was one of the best starts to a year in recent memory.
“We are very close to being at full employment in this economy. When the job market is tight, wages are going up. And when people’s wages go up, they generally spend it. Wages are expected to grow 3% this year. Spending on goods, excluding services, I think, is going to grow 4.3% this year,” he said.
The gross domestic product grew at a 2.6% annualized rate in the fourth quarter, compared with 1.8% one year ago. In 2017, the economy expanded 2.3%, a sharp jump from the 1.5% it grew in 2016, he said.
Truckload shipments grew nearly 3% last year, but in the fourth quarter volumes jumped 7% year-over-year. It was a remarkable turnaround from a slow first five months of 2017. By trailer type, dry-van loads rose 2%, flatbed increased 2.2% and temperature-controlled improved more than 5%.
The Tax Cuts and Jobs Act will drive more Americans to spend on durable and nondurable goods because the lower tax rates will increase paychecks, Costello said. For-hire fleets transport these items.
Housing starts last year were the strongest since 2007, according to the federal government, so the construction market is thriving even before new infrastructure spending under the Trump administration. Read more
Source: TRANSPORT TOPICS
