In an interview with Talk Business & Politics, Shannon Newton, the president of the Arkansas Trucking Association, said the U.S is in a freight recession.
A freight recession is when freight demand is low for consecutive quarters. Demand in freight is often used to assess manufacturing, since the goods produced have to be transported, according to Freight Waves.
Newton said the trucking industry is surprised a recession of the overall economy hasn’t followed the freight recession.
“Consumers continue to surprise with their spending on really non-manufacturing goods. I think you’ve seen significant demand in discretionary spending for things that we regularly transport," she said. "Consumers are spending money on leisure, travel and restaurants. Our industry is bearing the brunt of that."
Newton said the demand for freight will return, but in the meantime trucking companies will enact hiring freezes, furloughing employees and layoffs. She said trucking companies will also hold off on investing in new equipment, technology and new trucks until the demand returns.
Earlier this year, J.B. Hunt, an Arkansas-based trucking company, was expected by analysts to have a decrease in revenue, according to Talk Business & Politics.
During the interview, Newton also talked about the Arkansas Department of Transportation opening a new trucking park at the end of last month in West Memphis. Truck parks are used to provide truck drivers with a place to rest, while they are moving freight. Newton said these types of parks are necessary.
“It’s a big deal for our industry because parking touches everything whether it be safety of the driver, safety of the public, recruiting drivers, demonstrating to drivers that we care about the places they have to rest and the efficiency of the industry,” she said.
According to the American Trucking Industry (ATI), truck drivers end their drive times early because they are unable to find a place to park. The ATI said this can cost truck drives about $5,500 in compensation each year.
In March, Arkansas’ U.S Senator John Boozman raised concerns about the lack of truck parking to U.S Transportation Secretary Pete Buttigieg. He also supported a bill that would provide grant funding to states that would allow them to build truck parking.
