Bobby Holland, vice president and director of freight data solutions with U.S. Bank, reports improved results for the number of freight shipments and amount spent by shippers in the fourth quarter of 2020.
According to U.S. Bank’s latest Freight Payment Index, the freight industry continued to show improved results in the fourth quarter. Growth was driven by strong numbers from e-commerce and retail, and the period also saw a surprising rise in construction materials, in support of an increase in the construction and remodeling of single-family homes.
Freight spend for the quarter outpaced growth in the number of shipments, indicating that transportation capacity was becoming increasingly tight, Holland notes. Heavy activity around West Coast ports drove up trucking rates in that part of the country, caused by a flood of imports from Asia, and the need for retail and e-commerce shippers to replenish depleted stocks.
The driver shortage continues to impact the industry nationwide, and was made even worse last year by the debut of the Federal Motor Carrier Safety Administration’s Drug & Alcohol Clearinghouse. The new registry flagged more than 40,000 drivers for use of medical marijuana and other controlled substances, but only around 10% have been able to clear their records and get back on the road. “That made a huge dent in an already tight market for drivers,” Holland says.
Whether the improved numbers for the fourth quarter indicate sustained economic recovery in 2021 remains to be seen. Vaccinations, if successful in halting the spread of COVID-19, could result in businesses reopening, and the economy resuming the strong performance it was displaying prior to the pandemic. But difficulties in restricting new strains of the virus could have the opposite impact. “We’ve got to keep an eye on how the pandemic progresses,” Holland says.
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