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Transportation News Bulletins - LTL and TL

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Unemployment level at 10%, truck transportation loses 3,300 jobs
Friday, 08 January 2010 00:00

WASHINGTON—Lack of confidence in the economic recovery led employers to shed a more-thanexpected 85,000 jobs in December even as the unemployment rate held at 10 percent.

Truck transportation lost 3,300 jobs in December to cap a three-month decline of 15,100 jobs in truck transportation, which includes local and long-distance freight.

December employment figures for the truckload and less-than-truckload segment of the industry will not be available until late January.

Since January 2007, employment in truck transportation has declined by 208,000, some 14.3 percent total of 1,456,600 employed three years ago.

The overall unemployment rate would have been higher if more people had been looking for work instead of leaving the labor force because they can't find jobs.

The sharp drop in the work force—661,000 fewer people—showed that more of the jobless are giving up on their search for work. Once people stop looking for jobs, they are no longer counted among the unemployed.

When discouraged workers and part-time workers who would prefer full-time jobs are included, the socalled "underemployment" rate in December rose to 17.3 percent, from 17.2 percent in October. That's just below a revised figure of 17.4 percent in October, the highest on records dating from 1994.

Revisions to the previous two months' data showed the economy actually generated 4,000 jobs in November, the first gain in nearly two years. But the revisions showed it also lost 16,000 more jobs than previously estimated in October.

The report caps a disastrous year for U.S. workers. Employers cut 4.2 million jobs in 2009, and the unemployment rate averaged 9.3 percent. That's compared with an average of 5.8 percent in 2008 and 4.6 percent in 2007. Nearly 15.3 million people are unemployed, an increase of 3.9 million during 2009.

The economy has lost more than 8 million jobs since the recession began in December 2007.

Most economists worry that 2010 won't be much better. Federal Reserve officials, in a meeting last month, anticipated that unemployment will decline "only gradually," according to minutes of the meeting released earlier this week. The Fed and most private economists expect the unemployment rate will remain well above 9 percent through the end of this year.

There were more job cuts Friday. UPS, the world's largest package delivery company, said it will cut 1,800 management and administrative positions to streamline its U.S. package segment. UPS has 408,000 employees worldwide. About 340,000 of those workers are in the U.S.

Many economists had hoped that Friday's report would show the economy gained jobs for the first time in two years. While the revised figures found an increase in November, it was tiny.

"One word sums it up: disappointment," said Jonathan Basile, an economist at Credit Suisse.

Referring to the drop in the labor force, Basile said, "that tells me that Main Street doesn't believe there's a recovery yet, because they're not out looking for jobs yet."

If jobs remain scarce, consumer confidence and spending could flag, potentially slowing the economic recovery. Many analysts estimate the economy grew by 4 percent or more at an annual rate in the October-December quarter, after 2.2 percent growth in the third quarter.

But the economy will need to grow faster than that to bring down the unemployment rate. And the concern is that much of the recovery stems from temporary factors, such as government stimulus efforts and businesses rebuilding inventories.

Still, some economists said that a recent trend of improvement remains in place. The economy lost an average of nearly 700,000 jobs in the first three months of last year, a figure that dropped to 69,000 in the fourth quarter.

And the private service sector added jobs for the second straight month, said Nigel Gault, chief U.S. economist at Global Insight, though the gains have been concentrated in temporary workers.

"Firms are still being very cautious, so the first thing they are turning to aren't full-time employees, but temps," he said. Companies have added about 166,000 temp workers since July.

The average work week remained unchanged at 33.2 hours, near October's record low of 33. Most economists hoped that would increase, as employers are likely to add hours for their current employees before hiring new workers.

Job losses remained widespread: manufacturing lost 27,000 jobs and construction shed 53,000, while retailers, the leisure and hospitality industries and government also cut workers.

Some companies are continuing to layoff workers: UPS said Friday it will cut 1,800 jobs. And defense contractor Lockheed Martin Corp. said Wednesday that it is cutting 1,200 workers, or less than 1 percent of its work force., 1/8/2010

LTL Pricing to 'Firm' Later in 2010, Report Says
Thursday, 07 January 2010 00:00
Research firm sees LTL rates going up with or without YRC.

Less-than-truckload pricing, which took a sharp turn downward toward the end of the 2009, will begin to firm by the second half of 2010 regardless of whether YRC Worldwide is still in business, investment firm Wolfe Research says.

Shippers are expected to hold firm on pricing in the first quarter, when many annual trucking contracts come up for bid, and those surveyed by Wolfe Research expect LTL rates to remain flat as long as YRC Worldwide stays in the game.

If the carrier shuts down sometime in mid-2010, shippers expect LTL prices would increase 5.7 percent year-over-year this year, Wolfe Research said. However, if the company continued to operate under Chapter 11 bankruptcy protection, those shippers believe rates would go up 2.7 percent on average, the research company said.

Rates for LTL freight dropped 10 percent or more on average last year as trucking companies fought desperately for business in the worst recession in decades. As the year drew to a close, some carriers offered discounts of 80 percent or more off base rates.

As early as October, one leading LTL executive, Old Dominion Freight Line's Earl Congdon, called the rates offered by many competing companies "unsustainable," as carriers tried to knock ailing YRC out of business or whittle down its market share.

Competing carriers succeeded in taking market share from YRC—although it remains the largest single player in the LTL freight market. One analyst recently pegged its market share around 15 percent—down from more than 20 percent a year ago.

But the company averted bankruptcy, narrowing its third quarter losses, winning new long-term lending and labor agreements and completing a debt-for-equity swap with bondholders Dec. 31 that eliminates $470 million out of about $1.6 billion in debt.

The Journal of Commerce Online, 1/7/2010

Truckers to Protest New York Plan to Ban Trucks on Some Highways
Wednesday, 06 January 2010 00:00

A coalition of business groups, including two trucking organizations, has organized a convoy of dozens of trucks scheduled to drive past the New York state capitol in Albany shortly before noon today.

The coalition, which includes the Business Council of New York, the New York State Motor Truck Association, and a grassroots organization called Truckers and Citizens United of New York, are holding the convoy and press conference to protest Gov. David Paterson's plan to close major highways in upstate New York to trucks. The convoy and press conference are scheduled for the same time Paterson will be giving his State of the State speech at the capitol.

"It makes no sense for the state of New York to be erecting barriers to the free flow of commerce on its roadways," says Kendra Adams, executive director of the New York State Motor Truck Association. "This policy will kill jobs and drive up cost for all consumers."

At issue is a new state Department of Transportation policy to restrict truck traffic on seven major highways in the Finger Lakes and Central New York regions. Proponents of the plan say each day, nonlocal trucks, many hauling municipal garbage, leave the interstates and cut through towns across the Finger Lakes and Central New York region. Instead, they say, trucks should stay on the National Network of highways, primarily the Interstate highway system, because it's designed to accommodate the long distance movement of people and goods between cities and rural areas.

Truckers say the restrictions, which are scheduled to take effect later this year, will force them to drive hundreds of extra miles and significantly increase transportation costs for regional businesses. The seven state highways affected are:

  • Route 41 in Cortland and Onondaga counties;
  • Route 41A in Cortland, Cayuga and Onondaga counties;
  • Route 90 in Cortland and Cayuga counties;
  • Route 38 in Cayuga County;
  • Route 79 in Broome, Tioga, and Tompkins counties;
  • Route 89 in Tompkins and Seneca counties;
  • Route 96 in Tompkins and Seneca counties.

A study last year by the non-partisan Capitol Hill Research Center based in Albany, found that that the agriculture, wood products, retail and trucking industries would be especially hard hit by the plan.

Other business groups scheduled to speak at the press conference include the New York Association of Convenience Stores, the New York Farm Bureau, and the National Federation of Independent Business.

For more information on the new truck policy, visit the New York State DOT web site at, 1/6/2010

UCR enforcement on hold
Tuesday, 05 January 2010 00:00

The Commercial Vehicle Safety Alliance has announced a moratorium on enforcement of the Unified Carrier Registration effective Jan. 1 for the 2010 registration year.

CVSA says the moratorium, which will remain in effect until further notice, does not impact UCR requirements as they relate to previous years.

An amendment to SAFETEA-LU has changed the methodology for determining fleet size by including only power units and eliminating trailers for the 2010 UCR registration year. CVSA says this significant change to the statute requires modifications to the fee structure that first must be promulgated in federal regulation in order for the program to proceed.

When the rulemaking is completed, participating states will mail registration notices to all entities subject to the UCR, allowing for a reasonable time period for companies to remit their fees. When participating states have agreed on a 2010 enforcement date, an updated enforcement bulletin will be issued.

In order for roadside enforcement of a previous UCR registration year to take place after Jan. 1, enforcement staff first should obtain evidence of interstate operations occurring during that particular registration year. Proof may include, but not be limited to, log entries, toll receipts, shipping papers, bills of lading, previous years' apportioned receipts or prior years' roadside inspection reports., 1/5/2010

Diesel Jumps 6.5¢ to $2.797
Tuesday, 05 January 2010 00:00
Gas Gains 5.8¢ to $2.665; Oil Surges Over $81

Diesel fuel rose by the most in more than two months, jumping 6.5 cents to $2.797 a gallon, the Department of Energy said Monday.

Diesel’s gain was the second in two weeks following seven declines. With last week’s 0.6-cent uptick, the 7.1 cents in increases almost erased the downturns, which had totaled 8.2 cents.

Trucking’s main fuel is now 50.6 cents over the same week last year, according to DOE figures. Monday’s rise was the biggest since a 9.6-cent spike on Oct. 26.

Gasoline, meanwhile, surged 5.8 cents to $2.665 a gallon, DOE said following its weekly survey of filling stations.

It was gasoline’s second straight gain, and left the motor fuel almost $1—98.1 cents—higher than the same week last year.

The upward moves came in tandem with oil prices that surged to more than $81 a barrel for the first time since October, Bloomberg reported.

Oil rose $2.15 to close at $81.51 a barrel Monday on the New York Mercantile Exchange, the first time crude has closed over $81 since Oct. 22 and the highest closing price since $86.59 on Oct. 9, 2008.

Each week, DOE surveys about 350 diesel filling stations to compile a national snapshot average price.

Transport Topics, 1/5/2010

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