The U.S. economy is poised for significant expansion for the first time since the great recession, according to American Trucking Associations’ Chief Economist Bob Costello. But a growing economy could constrain truck capacity.
Speaking at the NATSO Board of Directors meeting June 17, Costello projected that U.S. Gross Domestic Product (GDP) will grow by 3.5 percent in the current quarter, followed by 3 percent growth in the third and fourth quarters of 2014. This would mark the first time GDP has hit 3 percent for three consecutive quarters since 2004, he said.
“I’ve been optimistic since August of last year,” Costello said. “What has plagued the recovery has been sub-par growth. We will finally get back to over-par growth.”
ATA’s seasonally adjusted For-Hire Truck Tonnage Index increased 1 percent in May, Costello said, following a 0.9 percent gain the previous month. In May, the index equaled 129.7, up from 128.3 in April. The index is off just 1 percent from its all-time high in November 2013 of 131.
Compared with May 2013, the index increased 3.4 percent, marking the second-largest increase in 2014. Year-to-date, compared with the same period last year, tonnage is up 2.9 percent.
Costello said manufacturing and factory output represented key growth sectors, with year-over-year factory output projected to increase to 3.7 percent in 2015 from 3.1 percent this year. Costello added that for every 1 percent increase in factory output nearly 7,300 jobs are created.
This compares with a reduction of 7,500 jobs for every 1 percent increase in factory output between 2000 and 2007.
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