Vaccine, stimulus affecting logistics operations
As more stimulus payments are rolling out and millions of people are getting the COVID-19 vaccine, the logistics and transportation industries are seeing the effects.
According to this article in The Trucker, both are going to be major economic drivers this year and next year.
Sam Kahan, chief economist for ACT was quoted in the article.
“Distribution of effective COVID vaccines and additional government stimulus are drivers of economic growth in 2021 and 2022,” he said in the article. “Transportation and freight activity will shine as a result.”
We are excited to see that vaccinations spreading across the U.S. is starting to mean that previously shut-down or reduced service businesses are starting to come alive again. We agree that’s good for trucking, as long as there is the capacity to handle the additional freight.
As we’ve been talking about for more than a year, people staying home and working from home has meant a drastic spike in e-commerce. The trucking industry has been caught up making those deliveries. With at-home deliveries expected to stay steady, if not increase as people have money to spend, and deliveries to businesses return, that could strain the trucking industry. On one hand, it will be good that trucking rates are continuing to pick back up but on the other hand, the strain could cause issues initially. This is especially true if the truck driver shortage continues its spiral.
Even with those potential hiccups, the trucking industry and logistics officials are looking forward to the future. In this article from Talk Business & Politics, heavy-duty trucking officials said that while the first quarter was “soft” due to usually circumstances for that time of year in addition to the nearly country-wide snowstorm we had in February, the second quarter is already showing promise.
“Household spending has been strong as most received federal stimulus money. Also, household savings have risen over the past year,” the article reads. “Factory output is expected to rise and home construction should remain strong. Both are expected to contribute to rising freight volumes along with solid retail sales.”
All of this information is a good sign that things are starting to get back to a more recognizable, if not still new, normal after more than a year of frustration.