So far this year, U.S. manufacturing and industrial production levels have been nearly flat. On a seasonally-adjusted basis, national manufacturing has increased by only about one percent year-to-date.
To make matters worse, much of this production is merely feeding into larger inventory volumes, rather than translating into increases in shipping. At the retail level, total sales have now declined for several consecutive months.
Consumer Sentiment is also faltering, with most Americans anticipating a lethargic economy during the second half of 2012.
Despite all of this bleak news, there is at least one bright spot for trucking. Private and total construction spending have increased for several consecutive months. Most of this increase was driven by private construction spending, which is (as of June) up more than 13% year-over-year (6.4% year-to-date).
Building construction is very material-heavy, closely tying construction spending to demand for trucking: it takes a lot of truckloads to move the materials required for a single construction project. Clearly, both residential and non-residential construction volumes are substantially down from their peaks of a few years ago, but the current trajectory is promising.
This is not to say that manufacturing and retail consumption are losing importance. But, it is reassuring to have at least one source of growth in shipping demand to help keep the trucking industry moving.
Note: Current numbers for several of these outcomes will be released this week. July Retail Sales will be announced on Tuesday (August 14), July Industrial Production on Wednesday, and (preliminary) August Consumer Sentiment on Friday.