Will the boom in shipping last after the pandemic?
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Shipping company FedEx will announce its latest quarterly figures after markets close Thursday.
It’s been quite a year for the business of delivering things to our doorsteps. Online shopping has boomed, and last quarter, FedEx said the number of packages it shipped via ground grew by nearly a third compared to last year.
Delivery companies have had to expand to handle the boom in e-commerce during the pandemic. FedEx has been upgrading its existing facilities and building new ones.
And even before COVID-19, the company started making home deliveries seven days a week.
“They’ve been a great beneficiary of having that seven day network in place,” said Satish Jindel, president of the consulting firm ShipMatrix.
Last quarter, the Commerce Department said e-commerce sales grew by 36% compared to the same time a year ago. But will that last?
“I think it would be overly optimistic if you expect these growth rates to continue,” said Brian Yarbrough, consumer research analyst at Edward Jones.
Even if growth slows, shipping companies will still have to scramble to meet demand, said Rob Martinez at parcel consultancy Shipware.
“That concept that demand exceeds the capacity will continue into 2021,” he said.
Martinez said the big shipping companies usually compete with each other by offering discounts to retailers. But right now, he says that’s not happening.
COVID-19 Economy FAQs
With a slow vaccine rollout so far, how has the government changed its approach?
On Tuesday, Jan. 12, Health and Human Services Secretary Alex Azar announced changes to how the federal government is distributing vaccine doses. The CDC has expanded coronavirus vaccine eligibility to everyone 65 and older, along with people with conditions that might raise their risks of complications from COVID-19. The new approach also looks to reward those states that are the most efficient by giving them more doses, but critics say that won’t address underlying problems some states are having with vaccine rollout.
What kind of help can small businesses get right now?
A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.
What does the hiring situation in the U.S. look like as we enter the new year?
New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.
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