MARKET BRIEF | December 2022
A BRIEF look at what’s happening in the logistics and shipping industry.
RAIL CONTRACT UPDATE
On November 30, the House of Representatives voted to approve a bill that would avert a nationwide rail strike. This bill binds rail companies and rail unions to a proposed settlement that was reached in September, but was not approved by all unions involved. Members of Congress can exercise authority over interstate commerce to intervene in rail labor negotiations under the Railway Labor Act of 1926. While not a desired action by many in Congress — especially those that traditionally cater to labor unions and the process of collective bargaining — it was necessary in order to avoid a major blow to the U.S. economy during recession. This labor deal provides workers with a 24% pay raise, $5,000 in bonuses retroactive to 2020, one additional paid leave day, and more robust healthcare benefits. However, the deal does not include paid sick leave, which was the reason some unions originally rejected it. The Speaker of the House added a proposal for seven days paid sick leave to the bill, even though the higher wages worked into the contract were meant to compensate unions for not including sick time. That was going to be an aspect reserved for future negotiations.
P.M.A. & I.LW.U. REACH AGREEMENT ON HEALTH BENEFITS
The Pacific Maritime Association (PMA) and International Longshore and Warehouse Union (ILWU) announced that they have reached a tentative agreement on terms for healthcare benefits. This is seen as a major component of the negotiations. This contract covers more than 22,000 longshore workers at 29 U.S. West Coast ports. The previous agreement expired on July 1. Negotiations continue on other issues.
U.S. LTL VOLUMES DROP — PRICING DOES NOT
Freight volumes at large U.S. less-than-truckload (LTL) carriers are softening in the fourth quarter, and some trucking companies are responding with temporary layoffs or other cutbacks. However, despite the downturn, LTL revenue and pricing remain elevated compared with last year, and even compared to “pre-Pandemic” norms. Old Dominion Freight Line stated that, while LTL shipments per day declined 7.3% year-over-year in November, revenue per day increased by 7.3% in that same timeframe. The explanation for that discrepancy is in a 17.3% increase in LTL revenue per hundredweight (or yield), including fuel surcharges, in the first two months of the fourth quarter. Excluding fuel surcharges, LTL yield increased 8.6% year-over-year. Shipments dropped 1.4% in the first two months of the quarter compared with the same period in 2021.
LOGISTICS INSIGHTS: TRADE SHOWS
Trade show logistics is the process of coordinating the transportation and delivery of materials and equipment to and from trade show sites. This includes everything from booking freight carriers, to arranging for onsite labor to set up and tear down booths. Trade show logistics can be a complex undertaking, but working with an experienced trade show logistics service provider can make the process much simpler, whether you are an exhibitor, a trade show organizer, or a venue … READ MORE
On November 30, the House of Representatives voted to approve a bill that would avert a nationwide rail strike. This bill binds rail companies and rail unions to a proposed settlement that was reached in September, but was not approved by all unions involved. Members of Congress can exercise authority over interstate commerce to intervene in rail labor negotiations under the Railway Labor Act of 1926. While not a desired action by many in Congress — especially those that traditionally cater to labor unions and the process of collective bargaining — it was necessary in order to avoid a major blow to the U.S. economy during recession. This labor deal provides workers with a 24% pay raise, $5,000 in bonuses retroactive to 2020, one additional paid leave day, and more robust healthcare benefits. However, the deal does not include paid sick leave, which was the reason some unions originally rejected it. The Speaker of the House added a proposal for seven days paid sick leave to the bill, even though the higher wages worked into the contract were meant to compensate unions for not including sick time. That was going to be an aspect reserved for future negotiations.
P.M.A. & I.LW.U. REACH AGREEMENT ON HEALTH BENEFITS
The Pacific Maritime Association (PMA) and International Longshore and Warehouse Union (ILWU) announced that they have reached a tentative agreement on terms for healthcare benefits. This is seen as a major component of the negotiations. This contract covers more than 22,000 longshore workers at 29 U.S. West Coast ports. The previous agreement expired on July 1. Negotiations continue on other issues.
U.S. LTL VOLUMES DROP — PRICING DOES NOT
Freight volumes at large U.S. less-than-truckload (LTL) carriers are softening in the fourth quarter, and some trucking companies are responding with temporary layoffs or other cutbacks. However, despite the downturn, LTL revenue and pricing remain elevated compared with last year, and even compared to “pre-Pandemic” norms. Old Dominion Freight Line stated that, while LTL shipments per day declined 7.3% year-over-year in November, revenue per day increased by 7.3% in that same timeframe. The explanation for that discrepancy is in a 17.3% increase in LTL revenue per hundredweight (or yield), including fuel surcharges, in the first two months of the fourth quarter. Excluding fuel surcharges, LTL yield increased 8.6% year-over-year. Shipments dropped 1.4% in the first two months of the quarter compared with the same period in 2021.
LOGISTICS INSIGHTS: TRADE SHOWS
Trade show logistics is the process of coordinating the transportation and delivery of materials and equipment to and from trade show sites. This includes everything from booking freight carriers, to arranging for onsite labor to set up and tear down booths. Trade show logistics can be a complex undertaking, but working with an experienced trade show logistics service provider can make the process much simpler, whether you are an exhibitor, a trade show organizer, or a venue … READ MORE
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