Issue link: https://read.dmtmag.com/i/566735
Trucking Knowledge 38 // OWNER OPERATOR // SEPTEMBER 2015 By Todd Dills Next recession could hit as early as late 2016, say analysts A nalysts with the FTR Associates transportation forecasting firm say the next few years are likely to see a cyclical economic downturn. Disagreement on timing and severity, however, was on offer July 9 during a special edition of FTR's monthly "State of Freight" online seminar and Q&A. FTR Senior Consultant Noel Perry projected a downturn to start as early as late 2016. "The freight economy always slows before a recession," Perry noted. Activity in rail is seeing pronounced slowdowns in commodities relative to oil and gas as well as other areas, and there is slowing growth in international and domestic intermodal with "some signs that it's starting in trucking," he added. However, Perry also said "there's reason to hope we'll be out to 2017-'18 before the economy weakens." The bad news: "The global economy is not healthy," Perry said, referencing the troubles in Greece and elsewhere in Europe. "The Chinese stock market is plummeting down 30 percent or more." The troubles worldwide are relatively "small this year, but there could be globally-induced recession beginning sometime late next year – it's not something I'd bet on this time around, but its something to think about." Trucking growth in rates and volume has, in fact, slowed considerably, he noted. "This is a time to be wary," Perry said. FTR Director of Transportation Jonathan Starks emphasized slow growth as the hallmark of the end of a recovery. "The recovery is weakest when it's new and when it's old. The positive part of that is, because we've grown relatively slow in the service side of the economy, we haven't built up a lot of the imbalances that we typically do" on the end of a recovery. The severity of such imbalances compounds any downturn's effect. Starks outlined FTR's projections for freight