The LTL market continues to experience significant capacity issues due to the rippling effects of the COVID-19 pandemic as well as regular seasonal spikes. In addition to our monthly report, we want to provide you with the market insight to help you understand this rapidly evolving environment.
Here are the top factors that are currently impacting the LTL freight market:
- Shortage of truck drivers, dock workers, and other carrier support staff. COVID-related issues have directly and indirectly resulted in a decrease of the carrier workforce and caused carrier support staff to work from home, which has greatly impacted LTL carriers. LTL shipments move through multiple terminals which require additional touchpoints and labor more than other models. The pandemic is also affecting the hiring process, making it more challenging for carriers to bring in new employees to overcome the increase in volume and labor needs.
- Growth in e-commerce. The pandemic has caused accelerated growth in e-commerce as many people prefer to shop online for their safety and convenience. This shift has resulted in a significant increase in home deliveries, which had an unanticipated impact on carrier networks. In addition, big-box retailers have also seen record-setting performance, which requires trailer capacity that isn’t readily available.
- The latest stimulus package. The most recent round of stimulus checks will likely generate an increase in customer spending. This surge in the purchasing of goods may put further strain on the transportation industry. In addition, the stimulus package adds another challenge in recruiting new drivers and terminal workers.
- Extreme weather events. Recently, there have been severe winter storms across the country. These events threw off the balance of freight capacity that carriers depend on, causing a strain on the system. As tornado season approaches, there will likely be more extreme weather that may affect transportation networks both in the impacted regions and nationwide.
- Seasonal spikes. Each spring, there is typically an increase in freight shipping. This year’s seasonal spike may have a greater impact as it will be compounded by the factors above. In addition, we are seeing a backlog of freight at West Coast ports, further straining the system.
LTL capacity issues are expected to persist and will likely intensify in the coming months as these factors continue to create a significant effect on the LTL freight market.
We’re committed to helping you effectively manage through these LTL capacity issues. Please work with our dedicated customer service team to place and manage orders in a timely manner.
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