Good News in the June Jobs Report – But Not for Manufacturing, Logistics - Global Trade Magazine
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  July 13th, 2016 | Written by

Good News in the June Jobs Report – But Not for Manufacturing, Logistics

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  • U.S. manufacturing ticked up slightly in June.
  • NAM CEO Jay Timmons: Isolationist rhetoric “helps no one except our competitors in the global economy.”
  • Trucking companies cut 6,300 jobs while freight rail operators lost 1,600 jobs in June.

After a disastrous May jobs report that may have converted as many Trump supporters as a free weekend at Mar-A-Lago, the June numbers bring good tidings for Hillary Clinton and anyone looking for work.

The U.S economy gained 287,000 jobs in June, the strongest monthly result thus far this year. Among the industries posting the strongest job numbers were leisure and hospitality (+59,000), healthcare and social assistance (+58,400) and information (+44,000).

But in the long-suffering manufacturing and logistics industries, there was still little relief in sight. Manufacturing did tick up slightly: the U.S. Manufacturing ISM index—based on surveys conducted by the Institute of Supply Management—increased from 51.3 to 53.2 in June, and there were some encouraging signs of new orders, including export orders.

It’s a start, but the U.S. has lost 24,000 manufacturing jobs already this year, and in places like Los Angeles there is still a long way to go to replace the 20 percent of jobs lost since 2007.

Jay Timmons, president and CEO of the National Association of Manufacturers (NAM), called the unemployment rate reported in the Bureau of Labor Statistics (BLS) jobs numbers “unacceptable” in a statement issued through the organization’s website.

“Our economy isn’t creating jobs fast enough, especially manufacturing jobs.”

As this is an election year, both candidates have promised to improve the economy, and Donald Trump has emphasized a policy of bringing jobs back to America. But Timmons, a proponent of the Trans-Pacific Partnership (TPP) and other trade agreements that have been criticized by both presidential frontrunners, is not encouraged by campaign promises.

“It’s time for this isolationist rhetoric to stop,” he said. “It helps no one—except our competitors in the global economy.”

For industries associated with logistics, even the modest gains reported in manufacturing would be cause for celebration. But in an otherwise sunny jobs report, trucking companies cut 6,300 jobs, while freight rail operators lost 1,600 jobs. The past 12 months have been disastrous for railroads, with nearly 30,000 jobs lost.

Is help on the way? Some analysts believe the healthy numbers in other industries can be a rising tide that lifts all boats, including transportation. But as most of these occurred in the service sector rather than in goods-producing industries (where what is produced might need to be shipped by truck or rail) that trickle-down effect may take a little longer.

Fortunately, the one aspect of logistics that has stayed healthy—warehousing and storage –has remained strong. The June jobs report shows another 4,700 jobs added, for a total expansion of more than 54,000 jobs in the last year.

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