Page 40 - ATR 1 2013

Smooth, But Slow

Economic Sailing

ATA economist expects 2013 to be OK, 2014-15 to be better

by Steve brawner busters” after the Great Recession by 4.4 percent in 2012 but is expected

Contributing Writer ended. Unfortunately, growth has to increase only 2.6 percent in 2013.
been sluggish. “There have been a lot Factory orders are expected to slow sig-
Economic uncertainty and slowing of headwinds that have prevented the nificantly in 2013. Related indicators
factory orders will lead to slower growth economy from reaching its potential,” such as manufacturing output also are
this year, but pent-up demand should he said. “We’ve been growing far below showing slower growth. After increasing
result in a more prosperous 2014 and its potential.” by 8.9 percent in 2012, business invest-
2015, according to Bob Costello, chief However, pent-up demand hasn’t ment is expected to increase 5.1 percent
economist for the American Trucking gone away, Costello said. For example, in 2013.
Associations (ATA). consumers need to replace aging vehi- “Most economic indicators are
Costello said businesses and con- cles, and indeed they are doing so, as decelerating, not accelerating,” he said.
sumers remain wary even though the light vehicle sales have risen from a low “The only ones that are accelerating are
Great Recession has ended. They’re of about 10 million units in 2009 to housing and autos. Everything else is
uncertain about the country’s eco- 14.4 million in 2012 and an expected slowing down.”
nomic future and don’t know what 15.1 million in 2013. For the trucking industry, 2013
Congress will do next. Europe remains Among the most important eco- should be a year of slower growth before
shaky. Meanwhile, Hurricane Sandy nomic indicators is the housing market, things really improve in 2014 and 2015.
hit the nation’s eastern seaboard at which began heading south after reach- Inventories related to sales are rising,
the same time the fiscal cliff battle hit ing 2.3 million starts in 2006, bot- which means fewer goods will need to
Washington. tomed out in 2009 and hasn’t improved be shipped this year. For-hire truck ton-
“That uncertainty just holds back much since. However, residential con- nage, after rising 2.7 percent in 2012,
businesses,” Costello said. “You don’t struction finally started to show some is expected to cool to 2 percent growth
want to take any risks. You don’t want life in 2012 with a 25 percent increase in 2013, with loads increasing by only
to go out there on a limb, hire more to 767,000 units and an expected 28 .7 percent. LTL tonnage is expected to
people and invest in more capital until percent increase units this year. increase 2.3 percent after increasing 5
there is less uncertainty.” Aside from autos and housing, percent in 2012.
Costello said the economy would however, the economy is slowing. Freight volumes in 2013 should be
have been expected to “grow gang- Consumer spending on goods increased lower than in 2012. But again, as long

“ThaT uNcerTaiNTy JusT holds bacK busiNesses. you doN’T waNT To
TaKe aNy risKs. you doN’T waNT To go ouT There oN a limb, hire more
people aNd iNVesT iN more capiTal uNTil There is less uNcerTaiNTy.”

—bob cosTello,
chief ecoNomisT, americaN TrucKiNg associaTioNs

40 arKanSaS truCKing report | issue 1 2013