Category Archives: Broker Blog

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More on the Ebb and Flow of Truck Drivers

Last week, the U.S. Bureau of Labor Statistics reported (.pdf) that firms added 157,000 employees to their payrolls during January. As in December, the Construction and Manufacturing sectors continued to expand. But, for-hire trucking employment also grew, increasing by 5000 employees since December.

In another article, I examined transitions from and to for-hire employment in trucking. If manufacturing and construction are close substitutes for trucking, should all three of these occupations be swelling their payrolls simultaneously – especially when the overall unemployment rate remains at 7.9 percent?

Below, I update my previous analysis to incorporate time, showing the extent of employment transitions to and from trucking during each year over the last decade. Specifically, I use the previously discussed CPS-MORG employment transitions to show the ratio of new truckers to former truckers by year, rather than combined into a single measure for each sector. I present this ratio for three of trucking’s most related sectors: construction, trade (wholesale or retail), and manufacturing.

In the figure, a value of zero for a sector indicates that there is an equal flow of workers moving from that sector to employment in trucking as there is exiting for-hire trucking to that sector. A value of 0.5 indicates that there are three new truckers coming from that sector for every two former truckers departing for that sector.

Construction activity sharply declined during the recession, so it is not surprising to see an influx of construction workers into trucking towards the end of the decade. However, now that the construction sector is rapidly expanding again (.pdf), this trend could easily reverse.

The relative shift of truckers to manufacturing during recent years is also concerning, and as manufacturing activity continues to improve, this pattern is likely to continue.

Retail and wholesale trade appear to be the most balanced of the sectors, in terms of transitions to and from trucking. At this time, there is little reason to anticipate this pattern changing substantially.

 

About the author

Jeremy West is the Internet Truckstop research economist for the weekly Trans4Cast. Jeremy examines the broader economic picture and reports how the current economic headlines relate to the trucking industry. He holds a bachelor of science in Economics, with minor degrees in Business and Creative Studies, from Texas A&M University, where he is currently completing a doctorate in Economics. His research focuses on empirical analysis of topics in industrial organization, particularly those affecting the transportation sector. In addition to his academic training, Jeremy held several previous positions in corporate financial planning and economic forecasting. Jeremy enjoys the opportunity to offer highlights and analysis of the trucking industry.

 

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Internet Truckstop is First Load Board to Help Members Navigate New CARB Regulation

For Immediate Release

New Plymouth, Idaho

January 7, 2013
Internet Truckstop is First Load Board to Help Members Navigate New CARB Regulation

Internet Truckstop has rolled out a new decision support tool and a free webinar series to help Truckstop.com members’ transition into new regulations, now in effect, from the California Air Resources Board (CARB).

The new CARB regulation just went into effect, on January 1st, and requires every carrier driving on California roads to comply with the rules, or face hefty fines. While the weight of the regulations primarily fall on carriers, brokers and shippers will face penalties if they fail to ensure they are contracting with compliant carriers.

Internet Truckstop is the only load board that offers companies looking for trucks a quick sort function to find compliant carriers, saving time when searching for trucks to move freight on California roads.

Internet Truckstop’s four-week CARB webinar series begins on January 9th, with a different hour-long webinar being offered each Wednesday starting at 12:30 p.m. MST.  Each meeting will feature a visit from a member of CARB, with topics to be covered including: vehicle inspections, diesel particulate filters (DPFs), TRUCRS Reporting System, Truck and Bus Regulations, the Transport Refrigeration Units (TRUs) regulation, drayage truck regulation, public fleets, public transit agency, solid waste collection vehicle regulation, tractor-trailer greenhouse gas emission reduction regulation and enforcement of regulations.

“It can be overwhelming to those in the industry to stay on top of the stream of new regulations.  Internet Truckstop continues to offer information-driven solutions to our Truckstop.com members.”  Pat Dickard, Internet Truckstop Corporate Trainer

For more information on Internet Truckstop’s free CARB webinars, contact Pat Dickard at 800-203-2540 x 6181 or visit the ITS Business Development Webinar Series page.

About Internet Truckstop

Founded in 1995, Internet Truckstop was the first online freight matching service. Listening to the transportation industry is the driving force behind all of the innovative business tools that they develop. These easy-to-use tools, the largest freight database and a commitment to their customers makes Internet Truckstop the leader in Internet freight matching.

Source:

Justin Morken

800-203-2540 ext. 6283

justintm@truckstop.com

www.truckstop.com

Internet Truckstop

Po Box 99, New Plymouth, ID 83655

www.truckstop.com

 

 

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CARB Webinars receive an overwhelming response

 

Today marked the first day for ITS and CARB’s month long webinar series, “Will You be Able to Drive in California?”

With over 150 participants that came to the webinar full of questions regarding the new laws for driving in California. There will be another chance next week for more questions to be answered when another webinar is offered. The topic for January 16th is  Diesel Particulate Filters (DPFs), Truck and Bus Regulation, TRUCRS Reporting System. Don’t miss your chance to register! Click here for more information and registration.

 

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NEW EOBR from uDrove!

The U.S. Congress has passed the MAP 21 Transportation bill that requires drivers to track their hours of service using electronic logging devices. All truck drivers in the U.S. and Canada who drive more than 100 air miles from their home base must maintain driver logs. These logs are monitored by federal authorities to ensure that drivers are not exceeding their time on duty or driving hours. An Electronic On Board Recorder (EOBR) fleet solution automates Hours of Service reporting.  If you are required to file a record of duty status (RODS), this mandate affects you.

When the FMCSA first made its cost assumptions for requiring the use of EOBR, it used a popular device in the marketplace that a number of large fleets had adopted as a fleet management and electronic logging solution. The price for the hardware of this device was estimated at $1,675, according to the Preliminary Regulatory Impact Analysis. Smaller companies and owner operators that wanted a Fleet Management System to help reduce operating expenses, simplify business management, and improve driver habits could never justify the expense of purchasing the equipment, or committing to a long term contract. uDrove has built a solution for companies that is affordable and easy to use, minus the contracts.

While implementing an EOBR system in your fleet does require an initial investment, the long term benefits outweigh the costs incurred up front. Hours Of  Service violations are virtually eliminated and Fuel/Mileage tracking is done electronically, simplifying IFTA reporting and reducing driver error.  Not only does uDrove eliminate driver error but we have integrated with PC Miler to give our customers access to real-time date for a single truck, a group of trucks, or an entire fleet’s in-state and interstate mileage, with automated reports for fast and efficient compliance with state and federal tax regulations.

Using smart phone technology, drivers can also maintain their fuel and business expenses electronically. By taking a picture of fuel and expense receipts, anything a driver spends money on can be captured and kept on their web account at uDrove.com.

uDrove provides companies a simple, cost-effective solution that truckers can purchase pre-mandate, and still have it make sense financially. They came into the market well before the MAP 21 Transportation bill was proposed and passed. With the data received from the EOBR and the capabilities of the smart phone, companies realize their R.O.I. (return on investment) almost instantly.

For more information on uDrove’s EOBR please contact 888-983-7683 or visit eobr.udrove.com

by admin

Are Hurricanes Good for Trucking?

In the wake of Hurricane Sandy—as is often the case following a major natural disaster—economic pundits perform an intellectual dance, arguing whether or not a hurricane is ultimately good for the economy, especially during a recession. I want to take a narrower perspective, asking whether trucking volumes improve following a major hurricane.

The theory goes as follows. A hurricane such as Sandy destroys a large amount of physical property (e.g. houses, office buildings, shops, and infrastructure). Following the storm, the area slowly rebuilds, often renovating older and deteriorated construction along the way. This (re)construction activity requires a large volume of building materials, which—you guessed it—need to be trucked.

Although the story seems plausible, it’s ultimately an empirical question whether a hurricane leads to a significant uptick in trucking activity. To investigate this, I’ve plotted the timing of several major U.S. hurricanes along with the Transportation Services Index for Freight,reported monthly by the Bureau of Transportation Statistics since 1990. This index measures national freight activity and is seasonally-adjusted, which is key in this case because the “hurricane season” largely overlaps the annual peak trucking season. Thus, the test is to see whether hurricanes generate spikes in transportation volumes.

Eleven of the thirty most costly U.S. mainland tropical cyclones from 1900-2010 have occurred since 1990, per the National Oceanic and Atmospheric Administration (NOAA, .pdf report, Table 3a. on p. 9). To these, I’ve added Hurricane Irene (August 2011)for the figure below.

You can of course pass your own judgment on the results, but I think the data speak for themselves. To the extent that hurricanes boost trucking activity, the increase looks pretty small.

This is not to say that trucking is unaffected. In particular, some types of trailers (especially flatbeds) should realize bigger gains in volumes than others. But, I wouldn’t count on Sandy to revitalize the trucking industry.

 

Jeremy West
Internet Truckstop Economist

 

 

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Press Release – Internet Truckstop Launches a Platform to Analyze, Organize, Create and Execute the RFP Process

New Plymouth, Idaho–Internet Truckstop, the largest web-based freight matching service in the transportation industry, has launched a new request for proposal suite of services that was previously not available to brokers or third party logistic companies.

Internet Truckstop’s new Request for Proposal (RFP) Suite, is an advanced, cloud based system which requires no software installation and allows users to create, distribute and compete in the RFP Process.

“Our goal in developing the RFP suite was to provide our customers with a ground breaking RFP solution that would reduce the amount of time spent compiling data while also providing additional carrier capacity if needed when bidding on a RFP’s,” says Leigh Foxall, Director, Freight Matching. “Users can invite their pre-qualified core carrier group to participate in an RFP session as well as reach out to new potential carriers that are members of the Internet Truckstop community. Our service allows for customization to meet a user specific needs with user preferences being customized all the way down to lane choices. Users can quickly respond to RFP’s with a detailed understanding of their own available margins per lane as truck and rate history is uploaded directly into the platform.”

Internet Truckstop says their new RFP suite will help users manage their businesses and provide a single on-demand system to easily consolidate, organize, schedule, host, and award or accept lanes to selected transportation partners.

For more information visit www.truckstop.com or call 1-800-203-2540 x 6185
About Internet Truckstop
Founded in 1995, Internet Truckstop is the first and largest freight matching service on the web. Internet Truckstop offers more tools than any other freight matching service available. These easy-to-use tools, the largest freight database, and a commitment to the transportation industry make Internet Truckstop the leader in Internet freight matching.

by admin

Press Release – United Perishable Logistics secures a $250,000 Broker Bond with ITS Financial Services, LLC

United Perishable Logistics secures a $250,000 Broker Bond with ITS Financial Services, LLC

New Plymouth, Idaho – October 30, 2012- United Perishable Logistics (UPL) is pleased to announce the addition of a $250,000 broker’s surety bond provided through ITS Financial Services, LLC. This bond is in advance and well in excess of the 75K mandate currently scheduled to go into effect October 1, 2013 for all Brokers and Freight Forwarders. This action will provide UPL’s Shipper customers and Carrier clients additional financial security, as well as, demonstrating the financial strength of this rapidly growing freight brokerage.

“UPL secured the bond to lift the bar within the brokerage community and express our strong commitment to small and large trucking fleets alike, that our interests are aligned in ensuring prompt and accurate payment. Furthermore, this action is a demonstration of our confidence in the ITS bond and credit program as it works to protect the integrity of the freight industry,” says Steve Martori – Managing Member – United Perishable Logistics.

ITS Financial Services, LLC (ITSFS) is an affiliate of Internet Truckstop® providing bonding options for truckstop.com members. ITSFS also manages the Diamond Broker Program. Through this program ITSFS advertises the credit worthiness, the quality and size, as well as, the current status of a member’s bond to the 800,000 trucks using Internet Truckstop.

“The industry is well aware Diamond Broker members consistently meet and exceed industry standards. UPL’s action is another fine example. ITSFS is very pleased to provide this option, as well as, adverting this to all truckstop.com subscribers,” says Joe Foxall, CFO-ITS Financial Services, LLC

About United Perishable Logistics
United Perishable Logistics is a freight brokerage company specializing in third party transportation of refrigerated goods throughout the United States and Canada. Our 20 years of experience has taught us that trust and reliability are characteristics that cannot be compromised. UPL is dedicated to maintaining the highest business, credit and financial ratings in the industry which has earned us an outstanding reputation with both our carriers and customers.

About Diamond Broker Program
Participating members receive a diamond designation attached to every load they post with Internet Truckstop. The Diamond Broker quickly delivers valuable assurances to Carriers regarding credit, performance history and the quality of their bond. In addition to these competitive advantages the Diamond Broker receives experienced support to protect their bond, their credit score and their good name.

About Internet Truckstop
Founded in 1995, Internet Truckstop is the first and largest freight matching service on the web. Internet Truckstop offers more tools than any other freight matching service available. These easy-to-use tools, the largest freight database, and a commitment to the transportation industry make Internet Truckstop the leader in Internet freight matching.

For more information contact Steve Martori at 480-225-2444 or ITS Financial Services at 866-812-9675

by admin

Surprise, Surprise… the Manufacturing Sector Remains Choppy

By Jeremy West, Internet Truckstop Economist

Over the past few months, it has seemed like U.S. manufacturers are treading water. Factory output isn’t dramatically sinking, as occurs whenever the economy is entering a recession. But, on the other hand, we’re not seeing any production gains worth cheering about either.

Manufacturing Orders and Production

Two basic metrics are tracked for manufacturing output: the quantity of current production and the volume of orders for future production. Last Thursday, the Census Bureau reported that new orders in August for factory production fell 5.2% month-over-month and 2.5% year-over-year. This was the first year-over-year decline in new orders since November 2009.

Much of this decline resulted from a 101.8% drop in orders for commercial aircraft. As shown in the figure, orders excluding transportation equipment increased by 0.28% YOY. Regardless, the message is clear: manufacturing production is stalling.

Separately, the Institute for Supply Management reported that the Purchasing Managers’ Index (PMI) increased to 51.5 during September. This was positive news: any value above 50 indicates manufacturing growth, and the index has been below 50 since May. The next few months will show whether this represents a temporary spike in manufacturing activity or a reversal of the contraction seen in the manufacturing sector during 2012Q2.

So, the production picture isn’t entirely gloomy, and some regions of the country are performing better than others. During September, manufacturing output improved in Texas and in the Central Atlantic regions, worsened in New York and in much of the Midwest, and remained largely flat in the Philadelphia region.

Taken together, these reports offer a mixed outlook for total manufacturing—and, subsequently, trucking—with aggregate production activity trending to the downside. The next Federal Reserve Industrial Production and Manufacturing report is scheduled for October 16th. Don’t be surprised to find that factories continued to slowly churn.

by admin

Press Release – Tran4Cast Powered by Internet Truckstop Market Demand Index (MDI) Decreases 10%

Tran4Cast Powered by Internet Truckstop Market Demand Index (MDI) Decreases 10%

NEW PLYMOUTH, Idaho, September 18, 2012– Internet Truckstop, the largest web-based freight matching service in the transportation industry reports that the Market Demand Index (MDI) decreased 10% to 11.83 from 13.2 the previous week as reported in the weekly Trans4Cast.

The overall average equipment rate decreased 3% to $2.09 from $2.16 the previous week. Flatbed rates decreased 1% to $1.96 from $1.98 the previous week. Reefer rates decreased 6% to $2.16 from $2.30 the previous week. Specialized truck rates decreased 3% to $2.41 from $2.49 the previous week. Van rates decreased 2% to $1.82 from $1.86 the previous week.

“The economic climate remains tumultuous for trucking. On Friday, the Census Bureau reported that August retail sales increased nearly 1% from July, while the Federal Reserve reported that manufacturing activity shed 0.7% over the same period. Trucking activity should be seasonally strong through November, but broader instability continues to temper volumes and rates.”
Jeremy West, Internet Truckstop Economist

About Internet Truckstop
Founded in 1995, Internet Truckstop is the first and largest freight matching service on the web. Internet Truckstop offers more tools than any other freight matching service available. These easy-to-use tools, the largest freight database, and a commitment to the transportation industry make Internet Truckstop the leader in Internet freight matching.

About Trans4Cast powered by Internet Truckstop

Trans4Cast is the compilation of highly relevant data, easily accessible to all trucking professionals. The Market Demand Index (MDI), a measure of relative truck demand, is culled from Internet Truckstop data. Internet Truckstop compiles this weekly report that will assist in making critical business decisions. The report is now a web series with a news anchor and appears as the Industry Economic Update on BigTruckTV.com, Internet Truckstop, and Truckload Carriers Association. The show is produced bi-weekly and can be accessed online 24/7. Jeremy West is the economic consultant preparing this report. He holds a bachelor of science in Economics, with minor degrees in Business and Creative Studies, from Texas A&M University, where he is currently completing a doctorate in Economics. For more information on Trans4Cast, please contact Roxanne Bullard at 1-800-203-2540 ext. 6230.

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Is manufacturing activity weakening? Comparing the Industrial Production Index to the PMI

One of the more disappointing economic reports last week was that the Institute for Supply Management’s proprietary PMI for manufacturing remained below 50 in August for the third consecutive month. The PMI is a composite measure of several dimensions of the supply chain, and any value below 50 reflects a contraction in U.S. manufacturing activity.

In contrast, the Manufacturing component of the Federal Reserve’s Industrial Production (IP) Index increased moderately during both June and July (the August values will be released this week on September 14th). The divergence of these two indices presents a conundrum: how can manufacturing be simultaneously increasing and decreasing?

The discrepancy primarily results from differences in the method by which each of these indices is constructed. The Federal Reserve determines monthly IP Manufacturing strictly by examining (actual and imputed) industrial output, sourced from various trade associations and censuses.

By comparison, the PMI is formed from surveys of ISM member businesses and reflects five components: new orders, production, employment, supplier deliveries, and inventories. Because it includes several components besides production, the PMI may contract even if current manufacturing volumes are increasing.

So, which of these two indices is superior? Or, more specifically, which index better contextualizes the environment for trucking? Although some analysts argue the PMI has inferior predictive power (e.g. Bachman, 2010), this relates more to its usefulness for forecasting economic recessions than its quality in measuring the current business climate.

Overall, both measures are valuable for carriers to use in evaluating their future outlook. The Industrial Production Index is informative about future volumes, especially over a longer term—goods that are produced are eventually going to be shipped, generating demand for trucks. The PMI speaks to the current manufacturing climate, and declines in the non-output portions of the PMI could foreshadow production declines to come.

 

Jeremy West, Internet Truckstop Economist