How the Recession Is Affecting the Commercial Construction Industry

The ‘Great Recession’ theoretically lasted about 18 months, from 2007 to 2009. Recovery has been agonizingly slow in many industries but we are now in 2015 and the construction industry is more rapidly shrugging off the residual effects of the recession.

How Bad Was It?

Even though construction industry is cyclical and recession typically follows a boom period, nothing could have prepared it for the harsh and widespread reach of the recession:

    • Residential: Homeowners defaulted on homes and others delayed buying homes, leading to a glut of residential real estate languishing in realtors’ inventory.
    • Commercial: Commercial construction also was hard hit, severely impacted by the federal budget sequester and eventual-but-temporary shutdown, followed by scaled back government spending, and sharply reduced lending practices.
  • Institutional: Institutional construction remained stagnant, affected by the same limitations and funding problems that the commercial construction sector faced.

How Were Construction Workers Affected?

Nevada, California, Florida, and Arizona are typically areas with plenty of construction work. But the recession changed that:

    • Nevada employed an estimated 146,000 construction workers at the peak of its construction boom. That number was reduced by 59 percent.
    • Arizona’s construction employment dropped 50 percent from its pre-recession industry peak.
    • Florida was close on the industry-related unemployment heels of Nevada and Arizona, losing 40 percent of its construction workforce.
    • California fared better but still recorded a 28 percent drop.
    • According to the U.S. Bureau of Labor Statistics (BLS), approximately 2.3 million construction workers lost their jobs in the recession (nearly 30 percent of the total number of lost jobs).
  • The overall construction industry has an estimated 1.4 million fewer construction workers in 2015 than it did in 2007.

The Construction Outlook in 2015 and Beyond

Happily, the U.S. and its construction industry continue to move away from the harshest effects of the Great Recession. Industry observers expect to see these improvements:

    • Non-residential construction: picking up and looking more solid, especially with the expected 2.6 percent real GDP growth in 2015. This sector may rise by 8 percent with growth in office buildings, hotels, and industrial facilities.
    • Single family housing: expected to increase by 11 percent in the number of residential units, thanks to easier access to home mortgage loans.
    • Manufacturing plant construction: will probably drop about 16 percent after huge increases of 2013 and 2014.
    • Institutional construction: expected to continue its moderate upward trend and increase 9% over 2014 results.
    • Residential construction: called the potential ‘wild card’ of 2015 because of rising interest rates. Existing home sales may climb toward 10 percent.
  • Public construction: growth will remain low due to ongoing federal spending constraints. However, transportation spending is expected to grow by about 2.2 percent.

Ironically, construction workers may not be rushing to return to new jobs. Many left the industry altogether, retraining for other employment.

Texas and North Dakota both show significant increases in construction employment. North Dakota now needs to recruit construction workers. Texas’ construction employment is up 10 percent, nearing its pre-recession peak.

Economists don’t expect the construction industry to return to its peak level (2006) until 2022 or later. However, the BLS anticipates that the fastest-growing jobs now and 2022 will be in healthcare and construction.

So while the Great Recession did a considerable amount of damage to the overall economy, individual incomes, and morale, 2015 and beyond are looking considerably more favorable in the commercial construction industry.

Different Types of Commercial Transportation Insurance

Commercial transportation insurance is an absolutely huge field. It actually incorporates many different types of businesses, industry classifications, and even types of vehicles, than most people originally imagine. Here, you’ll find a quick overview of some of the key different forms of commercial auto insurance and how it impacts you.

Why is it so important? Well, consider that different vehicles present different risks, which translates to different insurance requirements, and also varying costs. The same applies for different industries and classifications.

The first way to consider commercial transport is by the different forms of coverage which may apply. This includes standard auto insurance policies, and general liability coverage.

Other types of commercial transport insurance coverage though include non-trucking liability, property or physical damage insurance, workers comp insurance, pollution coverage, inland marine insurance, equipment breakdown, property, trailer interchange, and so forth.

The next thing to keep in mind is that different types of trucks or vehicles, and different industries, may also have very specific types of commercial transportation policies written for them. Here, consider the varied needs of perhaps a refrigerated 18 wheeler truck versus a waste hauler, or a log hauler versus a tow truck, a household moving truck versus a construction or contracting van or pickup.

Taxi drivers, as well as charter buses and vans, even ice cream trucks and food trucks, need commercial auto insurance. A few other common vehicle and business types to consider include non emergency medical transportation, limousines, dump trucks, catering trucks, flatbeds, hearses, pump trucks, cement trucks,garage trucks, and on down the line from there. all of these different vehicles and industries have different commercial transport risks, and therefore different policies and forms of coverage.

Still, that’s just the beginning. Even if you have regular cars for your workplace, perhaps driving clients around or making deliveries, you need commercial policies for those vehicles.

Beyond that, all forms of commercial transport and vehicles should be protected by the right insurance policies. That includes trains, for instance, with railroad liability coverage, along with ships and planes, and all manners of water and aircraft.

Of course, if you think that you and your business may need commercial transportation insurance, or that you could use a better policy or a better price, then be sure to consult with a professional who has experience in your local area. Policies are different from state to state, so work with an insurance broker or consultant who knows your industry and your locale.

Why You Should Pursue a Career in Commercial Truck Driving

Why should you pursue a career in commercial truck driving? That is a very good question. Hopefully, by the end of this article, you will have enough valuable information to answer it yourself. So, why should anyone pursue a career in commercial truck driving? Let me start by giving you some fascinating statistics about the trucking industry.

Did you know that of all the modes of shipment in the commercial transportation industry, the trucking sector dominates the field with 83.7% of the revenue? The rail industry comes in at a distant second with only 5.6% of the total revenue. The air sector is third with 3.2%, and the oceanic freight sector is barely in the running with only 1.4% of all revenue being transported by ships. As you can see, the trucking industry isn’t going away anytime soon. In fact, the trucking industry alone collects 650 billion dollars in annual revenue each year. That’s 5% of the nation’s GDP! The trucking industry also pays out 35 billion dollars in federal, state, and highway use taxes per year and will grow by 21% over the next ten years. Not many career fields can promise you such great job security without a four year college degree like the trucking industry can.

Speaking of job security, in May of 2013 there was an estimated 1.5 million heavy truck and tractor trailer drivers earning an average median salary of $38,700 a year, which calculates to roughly $18.61 an hour. In fact, the Bureau of Labor Statistics estimates that truck drivers who were at the lower end of the pay scale still made $25,330 a year and truck drivers who were at the high end of the pay scale made $59,620 per year. How many other jobs can boast such a wide range of salaries without a four-year or two-year college degree? Not many. So, where are more truck drivers employed than anywhere else? Texas, California, Pennsylvania, Florida, and Illinois. The state of Texas hired 157, 260 truckers in 2013 while Illinois employed an estimated 66,050 truck drivers. But, don’t think you will have to relocate to one of these five states in order to find a decent truck driving job. The entire east coast is full of states that have an average 40,210 to 157,260 working truck drivers. If you’re looking for the states with the highest concentration of truck driving jobs in the U.S. look no further. North Dakota boasts 15,310 trucking jobs with an average median salary of $47,580 while Arkansas, Nebraska, Iowa, and Wyoming follow closely. Truck drivers in Alaska have the highest median salary at $53,440, while truckers in North Dakota, Massachusetts, District of Columbia, and Wyoming make an average $47,000 a year. If you were to look at a map of the United States showing the areas where the most truck drivers are employed, you would see that truck drivers are heavily employed from Texas all the way over to Pennsylvania and Florida, and all the way up to Michigan. Califonia and the Pacific Northwest also employ many truck drivers. Which areas have the least amount of working truck drivers? The midwestern states. That is why truck drivers in these states make more per year. Here’s one more thing to consider. U.S. intracontinental truck driving jobs cannot be outsourced.

Here are some more fascinating facts about truckers. The total distance traveled by truck drivers per year is 93.5 million highway miles? To put that in perspective, that’s 256,197,260 miles per day, 2,965 milers per second, and 3.7 million times around the earth or 195,713 round trips to the moon! That’s a lot of truckin’! Of course, with all those miles it would be nice to get good gas mileage. Unfortunately, that’s not going to happen. On average, long haul trukcs can carry 300 gallons of fuel, but can only travel eight miles per gallon. That’s about 6.8 gallons of fuel an hour at 55 miles per hour. That means it would take a class 8 tractor trailer 44 hours and 347 gallons of fuel to travel from Los Angeles to New York City. Of course, with a 300 gallon fuel tank, you would only have to stop for gas one time. With all those miles to travel, one of the perks of long haul truck driving is being able to see the beauty and splendor of the United States countryside and getting paid to do so!

Now that you know just how important the trucking industry is to the U.S. economy, how much the average truck driver makes a year, and how many total miles truck drivers travel on average per year, I want to end this article with one last statistic. The value of shipped goods that the commercial trucking industry transports per year is $139,463,000,000. That’s $382,090,411 per day and $4,422 per second! That is how valuable the trucking industry and the truck drivers themselves are to the citizens of the United States. Think about this, if you will. Almost every facet of our economy is dependent upon the trucking industry, from food to fuel, medicine to machinery, cars to clothing, and construction to manufacturing, they are all delivered and dependent upon the commercial trucking industry. To put it another way, if it wasn’t for truck drivers, you wouldn’t have a bed to sleep on, soap and shampoo to clean yourself with, clothes to get dressed in, food to eat for breakfast, a toothbrush and toothpaste to brush your teeth with, a car to drive to work in, gas to fuel that car, a computer to work on, food to eat for lunch, a car to drive back home in, a refrigerator, stove and microwave to store and cook dinner with, plates and utensils and a table to eat on, chairs to sit on, and a television to watch the game on while you sit in your sofa and drink your ice cold beer that was transported by truck drivers. Of course, I left a lot of stuff out but, you get the picture. Oh, I almost forgot, you wouldn’t have a house to live in either, unless it was made out of something other than bricks, concrete, wood, metal, or stone. Remember, if you bought it, a truck brought it.

So, back to the original question. Why should you pursue a career in commercial truck driving? Well, now that you know how important the commercial trucking industry is to the U.S. economy, how good the job market is, and how much truck drivers can make without a college degree, maybe the real question you should be asking yourself is, “why shouldn’t I pursue a career in commercial truck driving?”. That’s a question that only you can answer. If you do decide that you want to pursue a career in commercial truck driving, getting the proper training is your first step. Not only is the commercial truck driving job market ripe with possibilities, the steps you have to take to enter the job market are easier than you might think. To be certified to operate a commercial motor vehicle, all you need is a commercial drivers license, adequate physical health, and the ability to operate a commercial motor vehicle. That’s it. Of course, getting your CDL is a whole different story. It takes specialized knowledge and training to pass the required tests, and that training is usually obtained at a private or company-sponsored truck driving school. Most truck driving schools will give you the CDL training you need to pass the required CDL tests and obtain your commercial drivers license within a few months.