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Infrastructure and Trade, 2019’s Big Ticket Topics

by Charlotte Freed | Jan 11, 2019

Infrastructure and Trade in 2019Economic growth is slowing, but by no means lagging. Industry experts anticipate infrastructure to be a priority for Congress and President Donald Trump. Also tied to the administration rests the status of global trade, weighing on trade deals between the United States, Canada, and Mexico and with China and the European Union.

American Trucking Associations’ Chief Economist, Bob Costello, says “we have hit the peak in the current freight cycle, the economy is still growing”- albeit at a slower pace than the previous year. Costello projects a 2.5 percent increase in U.S. domestic product for the coming year, but expects freight activity in the first quarter to waver due to shipping patterns shifting due to threats of tariffs on Chinese goods. While Trump and Chinese President Xi JinPing came to an agreement at the G-20 summit to halt additional tariffs for 90 days, imports had already begun to course in while exports shrank, launching the U.S. trade deficit to a record $43.1 billion.

The Associated General Contractors of America in Washington Chief Economist, Ken Simonson, anticipates another year of growth for construction due to the increase of personal income and low levels of unemployment. However, those same low levels of unemployment could strain construction projects lacking labor force. Trade policy instability also effect construction, with businesses dependent on import and export materials feeling the inflation.

While a number of economists are optimistic of manufacturing due to the current strength of consumer confidence, others are wary of the economic expansion - some even nodding to the next recession. Technology joins manufacturing in its growth and impact, with new options boosting productivity and pushing efficiency. With the rise of connected and driverless cars, hydrogen-fueled trucks, and a hike in Class 8 trucks, truck equipment investment is slated to grow for the next four quarters.

All of that in mind, the lack of drivers only becomes more apparent. Rising prices caused by longer cargo waiting times may prompt emergency intermodal fees or stop door delivery, in addition to higher cost to the end consumer. Technology may help alleviate the shortage, but many carriers are turning to trusted temporary driver staffing services, such as Centerline Drivers, for their truck driver hiring needs. Without additional recruiting expertise to help bolster waning fleets, business owners are feeling the squeeze as drivers continue to retire, without a new generation to fill their seats.

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