Transportation, Warehousing Work Force Shrinks

Transportation, Warehousing Work Force Shrinks

The U.S. freight-related transportation industry and warehouse sector lost 400 jobs in January from December, as the companies involved in air and water, along with industrial real estate, shrank their work force numbers slightly, according to an analysis of employment statistics.

The manufacturing industry, a key driver of freight, grew slightly but at a slower pace in the same period, while the construction sector hit a three-year high, paralleling reports suggesting a housing recovery is gaining traction.

Employment in the transportation industries that handle freight and the warehouse sector was virtually flat, but total U.S. unemployment inched up 0.1 percentage point to 7.9 percent. Total U.S. employment expanded by 157,000 jobs in January, according to the Bureau of Labor Statistics, which revised its November and December statistics to show an additional 127,000 jobs were added.

The air transport sector, which includes passenger transport, saw the sharpest decrease in employment, with a loss of about 4,900 jobs, or 1.1 percent of the total work force. The warehouse and storage sector lost 500 jobs, reducing its total employment by 600 jobs, or 0.09 percent. The water transport sector also shrank in January, shedding 500 jobs, or 0.79 percent of its work force.

The freight rail industry added 600 jobs last month, growing its work force by 0.26 percent to 231,3000 jobs. The trucking industry also grew, expanding 0.36 percent, or 5,000 jobs, to a roughly 1.37 million work force.

The manufacturing industry added 4,000 jobs to 11.95 million jobs in January. The BLS revised the number of manufacturing jobs added in December from 25,000, to 8,000.

“This reflects the weaknesses that we saw over the second half of the year, and manufacturers have lost 7,000 workers since July overall,” National Association of Manufacturers Chief Economist Chat Moutray wrote.

The Institute for Supply Management’s index in January rose 53.1 percent, an increase of 2.9 percentage points, suggesting manufacturing production rose for the second month in a row. Moutray wrote that the latest revisions show the manufacturing sector contributed only 9.2 percent of total nonfarm payroll jobs in the first half of 2012. Plus, the industry has since only added 15,000 jobs compared to the broader nonfarm payroll gaining 1.2 million workers.

“Something is clearly wrong with that picture,” he wrote. “We need to move back to a position where manufacturing is once again making outsized contributions to growth and employment.”

Mortray noted manufacturing optimistim fell throughout last year, causing companies to restrain capital spending and hiring. Despite the avoidance of the so-called fiscal cliff, he said the national’s financial health still worries manufacturers.

“There have been some signs of progress in in a few economic indicators, which could give us some hope in the coming months, but until manufacturers feel that the economic landscape is on a firmer footing, hiring will remain skittish,” he wrote.

The construction industry employment added 28,000 jobs, as the work force expanded for the ninth straight month. Construction in place in December hit $885 billion, the largest buidout since September 2009 and a 0.9 percent increase from the prior month. The recovery of the ailing industry bodes well for imports of furniture and other home goods, which make up about 10 percent of U.S. containerized shipments.

“We are likely to see continued strong growth in single- and multifamily homebuilding, moderate increases in private nonresidential construction and shrinking public investment levels for the next several months,” said Ken Simonson, the Associated General Contractors of America's chief economist.

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