At its heart, the trucking industry is really all about jobs: not only in terms of the employment it directly offers (drivers, dispatchers, repair technicians, etc.) and the jobs it helps support (in construction, manufacturing, retail, etc.) but by delivering the raw materials and finished goods bought and sold as a result of all the dollars earned via work.
Thus it is no wonder that the sustained levels of unemployment over the past few years combined with the sluggish pace of job creation is generating an awful lot of concern both within and without the trucking industry.
For starters, private sector employment only increased by 119,000 positions between March and April, according to the April ADP National Employment Report released yesterday, in collaboration with Moody’s Analytics.
That report, derived from ADP’s actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis and not only were its April numbers gloomy, the firm revised its March job gain total from 158,000 downward to 131,000 jobs as well.
The U.S. Department of Labor will roll out the national job-creation picture for April tomorrow, but if it is anything like what occurred in March, apprehension about the pace of U.S. economic growth will only increase.
Indeed, March payroll employment growth at 88,000 proved much worse than expected, noted Nigel Gault, former U.S. chief economist for global research firm IHS.
“There were disappointments almost across the board, especially in manufacturing and retail trade, which both saw job losses,” he added. “Retail losses may have been exaggerated by extended cold winter weather [and] it is hard to blame the sequester for March's disappointment. Federal employment did drop by 14,000, but most of that was in the U.S. Postal Service, which isn't affected by the sequester. “
Gault said March’s data fanned fears that once again a slowdown in job creation would occur after a strong start to the year, as in 2011 and 2012. “The three-month moving average of job creation has now dropped to just 168,000 [whereas] it had been running above 200,000 previously,” he pointed out. “With the impact of the sequester yet to be felt, hopes that the economy could sustain a 200,000-plus monthly job creation rate will have to be deferred until 2014.”
Another big worry is that average hourly earnings were flat in March, Gault noted, with the year-on-year growth rate falling back to 1.8% from 2.1%.
The unemployment rate – which comes from a different survey than the payroll figures, he stressed – fell from 7.7% to 7.6%, but the most comprehensive measure of “underemployment” that includes workers who would like a job but are not currently looking, plus those working part time who would rather work full time, fell from 14.3% to 13.8%.
“The weak March jobs report supports our view that the economy will slow in the second quarter after a strong start to the year,” Gault noted at the time.
Yet things turned out even gloomier than that, as expected first-quarter gross domestic product (GDP) growth reached just 2.5% instead of the 3.8%level expected by IHS – not a good number when the firm things second quarter GDP growth will only hit 0.4% as an inventory bounce fades and the sequester begins to bite.
What does all of this do for the job picture? Well, IHS remained upbeat to a degree, anticipating job creation averaging around 155,000 per month over the rest of the year, better than March but not regaining the 200,000-plus pace seen as 2012 turned into 2013. But ADP’s numbers may signal far slower job creation than even that prediction.
As a result of this, American workers are becoming increasingly more worried about their income and benefits security, as well as their employability, at least according to the recently-introduced Harris Poll Jobs and Benefits Security Index – a poll designed to provide a monthly score o track the changing sentiment of U.S. workers.
Harris Interactive’s research – conducted online within the U.S. between April 15 and 17 among 2,114 adults aged 18 and over of whom 935 are employed full-time or part-time – found that aggregated concerns regarding income, benefits, and employability showed a slight increase from 56% in March to 57% in April, particularly among older and higher income workers. (The report’s full findings and data tables are available here)
Some key trends identified by Harris in this poll include:
- More U.S. workers (50% March - 53% April) expect to do more work without getting more money in the next three months
- More U.S. workers (20% March - 24% April) expect to have their salary or hours reduced in the next three months
- Fewer U.S. workers (61% March - 55% April) believe that if they were going to look for a new job, they would be able to find one
- Fewer U.S. workers believe they will get a raise from their employer (35% March - 29% April) or receive better retirement benefits (18% March - 13% April) in the next three months
Looking at the aggregated Jobs and Benefits Security Index measurement, findings of particular note include:
- U.S. workers with an annual household income of $50,000-$74,999 (58% March-62% April) are both the most concerned income group and the group showing the sharpest month-over-month rise in concern.
- Those with incomes of $75,000 or more also show notable growth in concerns (56% March-59% April)
- U.S. workers ages 55 and older (60% March-63% April) are, in an echo of the trend above, the age group showing both the greatest overall concern and the most prominent growth in this measure.
“Workers are more pessimistic about the likelihood of finding a job if they need to look for one, as well as the likelihood of seeing a benefits improvement,” said Al Angrisani, president and CEO of Harris Interactive, who also served as assistant Secretary of Labor under President Ronald Reagan.
"Escalation in the index also speaks to structural changes occurring in today's workplace, with employers seeking growth in worker productivity, at the expense of hiring a new full time employee with increasing tax and benefits costs," he added. "Recruiting and hiring talent and new employees appears to have become a major investment consideration for employers and this new phenomenon is contributing to an increase in job 'insecurity' within corporate America."
Those just are not rosy factoids, by any stretch of the imagination, and they sure don’t offer good tidings in the long run for trucking. So let’s hope the broader federal measure of job creation to be released tomorrow offers some better portents for the economy’s -- and trucking's -- future.