The big stories of the Election, Europe and the Euro, and of course, unemployment will shape the economy. Who knows what the economy will be for the next 12 months? Nobody knows. What we can do is manage our costs.
Consider our major cost components such as driver wages and benefits, fuel prices, new trucks, repair parts, loan rates and insurance costs. Using publicly available information, here is what to expect in 2012/13.
Driver wages (including benefits) are $18 to $20 an hour and increased less than the rest of the US employment costs. What is the safest forecast? Extension of the current trend, with labor costs rising 1.3% annually.
Diesel Fuel Prices, per the Dept. of Energy may fall modestly, not any big help with the diesel fuel price over $4 dollars or near it. At least, you can plan for near $4 diesel. While prices have dropped recently, the larger concern is diesel fuel inventories. The US Department of Energy tracks the levels.
New Heavy Trucks (33,000 lbs and above) prices are up 4.5% over last year using the Dept. of Labor, Bureau of Labor Statistics historic averages. If this trend continues, plan on a replacement truck next year to cost 105% of current prices.
Interest rates, covering business loans are expected to remain untouched per the Federal Reserve’s recent public comments on economic conditions.
Insurance premiums may climb as the Property and Casualty Insurance industry recovers from the 2011 tornado and storm season. The Insurance industry payouts totaled so much, ranking the storms the fourth worst (most expensive) loss in US history. What was the worst loss, you ask? Katrina.
What does all this mean to MY wallet?
The good news, none of these costs has HUGE increases. These are all incremental. Still, no cost increase is a good increase.