The nation's economy continued to gain momentum during the second quarter but statistics show that various areas of the country are emerging from the pandemic at different paces, according to a freight industry report from U.S. Bank.
Overall, freight spending jumped 10.1% over first quarter levels, bringing the total measure to its highest recording in the history of the index, Minneapolis-based U.S. Bank said in its “Q2 2021 U.S. Bank Freight Payment Index.”
In fact, the indexes measuring both shipments and spending grew sequentially as well as year-over-year, reflecting solid economic activity including retail sales, imports, construction, and manufacturing output, U.S. Bank said.
However, the growth trend was not evenly distributed, as the number of truck freight shipments rose compared to 2020 in three of the five regions (Southeast, Southwest, and West), while it contracted slightly in the remaining two (Northeast and Midwest). Across the U.S., the overall number of shipments increased significantly in the second quarter, up 4.4% from the first quarter and 6.8% year-over-year.
Complicating the nation’s rebound are rising diesel fuel prices that have increased freight costs, and a protracted labor shortage that has constrained the carrying capacity of the nation’s trucking fleets, Bobby Holland, U.S. Bank’s vice president and director of Freight Data Solutions, said in a release.
“These robust gains stem from extremely tight truck capacity due to a profound driver shortage, as motor carriers have been unable to increase supply sufficiently to meet the growing demand. As a result, pricing increased considerably as shippers worked to get loads moved in the time frames needed,” U.S. Bank said in its report.
“As industries ramp up output from increased demand in the second half of the year, truck freight demand will grow as well. The challenge for the motor carrier industry will be meeting that demand in the face of one of the largest supply crunches in history. Increased new driver training and rapidly rising pay will help, but it will take time to get additional drivers into the market,” the bank said.