I am not so sure the trucking industry's troubles are an indicator of a recession, but they certainly seem to be the result of a ravaged retail landscape.
I found an article on Business Insider that caught my eye. Written by Rachel Premak, its title will undoubtedly catch your eye as well: "The 'bloodbath' in America's trucking industry has officially spilled over to the rest of the economy."
My first reaction was: "what bloodbath"? I had no idea that the trucking industry was in that bad a shape. It is. Here is how Ms. Premak puts it:
This year alone, some 2,500 truck drivers have lost their jobs as trucking companies large and small declare bankruptcy…the volume of trucks purchased in July fell to its lowest level in nearly 10 years. Loads in the spot market tumbled by 37% this July from July 2018. And the Cass Freight Index says year-over-year trucking volumes have slipped for eight consecutive months.
The message Ms. Premak and others take from this are that a recession is coming. Trucking is a leading economic indicator of a turn down in the economy. But there is a caveat to that rule. It's only accurate in predicting a recession half of the time.
So what is going on? Here is what I think: The accumulation of bricks and mortar retail store closings is killing the shipping industry. We lost a total of almost 13,000 stores between 2017 and 2018. According to USA Today, we will lose another 12,000 this year.
Bottom line, I am not so sure the trucking industry's troubles are an indicator of a recession, but they certainly seem to be the result of a ravaged retail landscape. Throw in a tariff, and we may well get a recession.