As we approach the mid-point of 2013, here is a peek at some of the major trends that are having an impact on freight transportation.
Economic Growth to remain Modest and Uneven
The economy continues to deliver mixed signals. In the past week, the US and Canada reported strong growth in employment. In fact, the 95,000 growth in jobs in May of 2013 is the best monthly number in Canada in decades. The question is whether this was a one month aberration or an indicator of better days ahead? A look past the job numbers tells a different story. Only a few hot spots (such as the shales) are displaying significant growth. Housing and automotive are strong sectors. Additionally, NAFTA-related trans-border activity has presented opportunities for carriers.
At this point, it is hard to build a case that the 2H13 would be much better, especially in light of the mediocre Spring in so much of North America. However, strong automotive production (some plant shutdowns have been eliminated or cut short), the release of pent-up consumer demand accumulated during this year's elongated winter, continued recovery in housing markets, and hurricane/tornado repair/reconstruction efforts on the US could make the 2H13 stronger than some anticipate. But The Institute of Supply Management's monthly index or "PMI™ registered 49 percent in May, a decrease of 1.7 percentage points from April's reading of 50.7 percent, indicating contraction in manufacturing for the first time since November 2012 and only the second time since July 2009. This index will need to be closely watched in the months ahead to see if there will be a sustained improvement in economic activity.
Supply Chain Optimization is Lowering Freight Costs
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