Spot rates have now gone from the basement to the penthouse
Load volumes continue to increase week-over-week like clockwork. The gain in outbound tender load volumes this week was another 1.4%. Capacity tightened even further heading into the holiday weekend. Outbound tender rejections are now signalling that a touch more than one in four contracted loads are being rejected by carriers. This has pushed spot rates up 33% this year to a frothy $2.75 per mile based nationally.
You can learn more about what’s happening in the spot market below with FreightWaves’ weekly show dedicated to the latest action in the spot market below.
Capacity crunch: Drivers are slow to get back behind the wheel again
August employment rates indicate there is still quite a deficit of drivers since the swift exit of jobs and drivers in April. The latest jobs numbers do show a healthy gain of 10,000 transportation jobs in August. Year over year numbers show that transportation jobs are roughly 6% lower than in 2019 though.
According to the Truckload Carriers Association (TCA) driver turnover has recovered since the April low of 55% and is now at 76%. This is a tad bit lower than July of 2019 when driver turnover was pegged at 80%.
Construction employment levels are recovering at a faster clip than the trucking sector. Chart: SONAR EMPS.CONS, EMPS.TRUK
Air cargo rates set to take off again
After three weeks of stable rates, the air cargo market is taking off. Rates are now climbing again. Asia to North America is now seeing the most action as product launch season gets closer to reality. With ecommerce growth accelerating even further than most would have forecast for 2020, and flights grounded due to the pandemic, the fourth quarter holiday rush should be an interesting rate environment for the market.
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