With 2021 well under way, the logistics industry is off to a solid start and top analysts are optimistic that the transportation industry will remain steady this year.
The U.S. economy is predicted to be in store for record-breaking GDP growth. Goldman Sachs raised its forecast for 2021 US gross-domestic-product growth to 6.8% from 6.6% because of the expected larger coronavirus relief package. This will be a large increase especially following the anemic year we had in 2020. The US economy contracted 3.5 percent on an annual basis in 2020, the largest contraction for any full year since the demobilization from World War II in 1946. However, disposable personal income (which subtracts taxes paid and adds government benefits received) experienced the fastest annual growth since 1984 contributing to the increase in purchasing of goods in 2020.
Amid the COVID-19 pandemic in 2020, truckers did an extraordinary job supporting the US economy. The trucking industry’s response to the COVID-19 pandemic created and flood of support for drivers and greatly improved public opinion of the industry as a whole. “Consumers have witnessed now firsthand what we do all the time. Unfortunately, it takes a worldwide pandemic for that to come to the surface, but the recognition is so well-earned and deserved…” said American Trucking Associations President Chris Spear, “2020 was a very defining year for trucking.”
Online shopping was already increasing in popularity, and shoppers being isolated indoors since March of 2020 has only accelerated that shift. “For the last four years, e-commerce growth has averaged between 13% to 17% increase, and last year it was up 14.7%,” says Ron Sides, Deloitte’s vice chairman and U.S. leader retail and distribution. “This year it will go ballistic, somewhere around 25% and it may go higher” bringing last-mile delivery up to unprecedented levels.
The medical transport sector is also geared to sky rocket, though much depends on the vaccine and how fast it is distributed to the general population. American Trucking Associations Chief Economist Bob Costello said, “the vaccine will help return to ‘normal,’ which means sectors that are currently hurting — like services and manufacturing — can bounce back, leading to more freight.”
Fortunately for truckers, pay increases should continue through 2021 as capacity continues to tighten and fleets are forced to compete for drivers. As companies increase driver pay to attract new drivers, it forces others to do the same to remain competitive.
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