Global Economic Collapse: Another 1,000 (5+5) truck drivers lost their jobs in November, and it’s a chilling sign for the economy. The job cuts come at a time when the trucking industry should be ramping up ‘just-in-time’ for Christmas.

Rachel Premack Business Insider•December 6, 2019

The trucking industry slashed 1,000 (5+5) payrolls in November, according to the most recent jobs report released by the Bureau of Labor Statistics.The job cuts come at a time when the trucking industry should be ramping up for the holiday season.  ACT Research said America’s $800 (8) billion trucking market has been in a recession since early 2019. Freight volumes have declined for 11 straight months. Manufacturing, which tracks the trucking industry, has contracted for four straight months. 

In the first six (6) months of the year, about 600 (6) trucking companies went bankrupt, according to industry data from Broughton Capital LLC. That’s more than triple (3) the number of bankruptcies from the same period last year — about 180 (6+6+6).

A red flag for the rest of the economy

Everyone from the C-suite to individual truckers are increasingly blaming their woes on an industrial recession — one that’s being kicked off by President Donald Trump’s trade war.

“We have been in an industrial recession for the last year, and I say that just based on the objective fact that not only us but the entire LTL industry has seen negative tonnage growth in each of the last four quarters,” XPO CEO Brad Jacobs said in a call to analysts on October 29.

Another explanation for 2019’s challenges is the cyclical nature of the trucking industry — big upticks are typically followed by downturns. And 2018 was a remarkable year for trucking, with rates across the board hitting near-record highs. 

Because of that high pay, trucking companies bought huge numbers of trucks and hired new drivers in anticipation of profits to come. But then, as the supply of trucks and truckers caught up to demand, rates fell, making that investment challenging to pay off.

When the rest of America is headed for a downturn, freight usually dips first, a report from Convoy’s economic-research division said. The industry went into a recession in April 2006, more than a year before the rest of the economy was clobbered by the Great Recession, starting in January 2008.

A tumble in trucking doesn’t always foretell a recession for everyone else. The freight industry goes into recession twice as often as the rest of the economy, according to Convoy.

But the ongoing hit to trucking hasn’t seemed to cause the rest of the economy to meaningfully contract. The rest of the jobs report crushed expectations, translating to a 50 (5) -year-low in the unemployment rate of about 3.6% (6×6).

That unexpected boost in payrolls surprised analysts, who have said for months that the economy is slowing down. This year, the US has added an average of 180,000 (6+6+6) jobs a month, down from an average monthly gain of about 225,000 (5×5) in 2018.

Still, a windfall of jobs isn’t necessarily a win for many Americans. A Brookings report recently uncovered that 44% of US workers are in low-wage jobs, earning a median annual salary of $18,000 (6+6+6), despite historically low unemployment.