An increase in goods entering California is signaling optimism about the resilience of U.S. consumer spending and the trucking industry this year.
The combined inbound-container volume at the Los Angeles and Long Beach ports has risen 3.5 percent in the first four months of 2013 from a year earlier, according to data compiled by Bloomberg. That comes after total imports through these locations grew 0.9 percent last year compared with 2011.
Tugboats help guide a Mediterranean Shipping Co. (MSC) ship loaded with freight containers in this aerial photograph approaching the Port of Long Beach in California. Photograph by Tim Rue/Bloomberg
The activity suggests that an increase of 3 percent to 5 percent — consistent with modest consumption growth — is attainable this year, even as retailers keep inventories lean, said Todd Fowler, vice president and analyst in Cleveland with KeyBanc Capital Markets Inc., the investment banking arm of KeyCorp. Rising shipments through these ports — which account for almost 50 percent of all container imports — bode well for truckers because the same retailers that are top importers are typically the biggest customers of large trucking companies, he said.
“Containerized imports are a primary leading indicator of domestic transportation volumes, with about a three-month forward look,” Fowler said. For-hire trucking companies — including Swift Transportation Co. (SWFT) and Knight Transportation Inc. (KNX) — transport a majority of the freight for big-box retailers, so they will benefit from improved demand, he said.
An index of U.S. truck loadings rose 3.9 percent to 120.95 in April from a year earlier, following a 4.2 percent gain the prior month, based on data from FTR Associates, a Bloomington, Indiana-based transportation-forecasting company. While this proxy for volume has grown for 17 consecutive months, it has moderated since the early phases of the economic recovery, when it grew by as much as 13.5 percent in the fourth quarter of 2010, said Jonathan Starks, director of transportation analysis.
“Trucking volumes are in a positive, but not extremely strong, stage of growth, and we expect that will continue through 2013,” Starks said. FTR is forecasting that truck loadings will rise by “just under 5 percent” this year, he said, compared with 3.2 percent in 2012.
For-hire trucking added 11,700 jobs in April, more than offsetting the 6,300 lost in March.
WASHINGTON — The U.S. economy showed last month why it remains the envy of industrialized nations: In the face of tax increases and federal spending cuts, employers added a solid 165,000 jobs in April — and far more in February and March than anyone thought.
The job growth in April drove down the unemployment rate to a four-year low of 7.5 percent and sent a reassuring sign that the U.S. job market is improving.
In its report Friday, the Labor Department revised up its estimate of job gains in February and March by a combined 114,000. It now says employers added 332,000 jobs in February and 138,000 in March. The economy has created an average of 208,000 jobs a month from November through April — above the 138,000 added in the previous six months.
For hire trucking added 11,700 jobs in April after losing 6,300 in March.
In the past three years, the industry has added 147,600 jobs, Labor Department statistics show.
“We don’t know what types of jobs (the April gain) they are, but since the majority of trucking employment is drivers, it would suggest that category,” Bob Costello, chief economist at the American Trucking Associations, said. “The gain since April 2010 is significant. Looking backward, in 2012, trucking employment grew at twice the rate as total U.S. employment.”
“This is a good report,” said John Silvia, chief economist at Wells Fargo. “There’s a lot of strength… It’s good for the economy. It’s good for people’s income.”
The stronger job growth suggests that the federal budget cutting “does not mean recession,” Silvia said. “It does not mean a dramatic slowdown.”
Stock prices soared when trading began on Wall Street at 9:30 a.m. Eastern time. The Dow was up 155 points in early trading.
The for-hire trucking industry added 11,700 jobs in April, according to preliminary data released this week by the U.S. Bureau of Labor Statistics. This is the largest month to month increase since February 2012, when the industry added 12,700 jobs.
The report comes on the heels of March’s 6,300 job cuts in trucking. However, employment in April found somewhat of a footing, as national unemployment dropped to 7.5 percent, riding a gain of 165,000 jobs in April and a gain of 138,000 jobs in March.
That unemployment rate is the lowest since December 2008.