Leading Freight Analyst Declares ‘Truck Driver Shortage is Over’ as Recession Looms
Columbus, IN — A leading freight analyst is declaring an end to the so-called driver shortage and is warning of a possible recession.
Tim Denoyer, ACT Research’s vice president and senior analyst, is urging fleets to “batten the hatches” as the “driver shortage is over.”
According to ACT Research’s latest for-hire trucking survey measuring the balance between freight supply and demand, supply is now outpacing capacity for the first time since June of 2020 as the “rebalancing, drawn-out by the pandemic, hit critical mass.”
“As recently as the start of the year, pricing power in the truckload market was firmly with fleets,” Denoyer commented. “But once a pendulum gets going, it’s very hard to stop.”
Denoyer pointed to the shipments component of the Cass Freight Index which fell in April by 2.6% compared to March and 0.5% y/y.
Making matters worse for fleets, the expenditures component of the Cass Freight Index, which measures the total amount spent on freight, rose 0.2% m/m in April.
Compared to a year ago, total freight expenditures in April were up a whopping 31% y/y while overall rates were up just 2.9%
“After a nearly two-year cycle of surging freight volumes, the freight cycle has downshifted with a thud. The prospect of freight recession is now considerable, as substitution from goods back to services spending picks up pace, and as inflation slows overall spending, particularly via higher fuel prices and by pressing up interest rates,” Denoyer analyzed.