Trucking industry delivers for the Corridor

The “multiplier effect” is a term economists use to measure the rate at which spending in a certain industry creates and supports additional spending and hiring in related fields. Strictly speaking, trucking doesn’t have one.

“Typically, trucking actually follows manufacturing and mining,” said Johathan Phares, assistant professor of supply chain management at Iowa State University. “If there was a multiplier, which I’m not sure there is, it would be in the other direction.”

So a truckload of, say, Cap’n Crunch leaving Cedar Rapids isn’t economically credited to the trucker. But the cereal wouldn’t get to breakfast tables without the them.

“Everything that you eat, that you touch, that you buy, it all comes through trucking in some fashion,” said Fred Grask, president of Grask Truck Group. “The trucking industry in Iowa and across the country is important to our economy.”

Grask’s Cedar Rapids-based company also operates Peterbilt truck dealerships in Waterloo, Davenport, Quincy, Ill., and three cities in Kansas. Its 260 employees sell new and used semi-tractors and work long hours – 7 a.m. to midnight weekdays – to keep customers on the road.

“When those trucks are down, they’re not making money, so you try your darndest and best to get that truck repaired,” Grask said.

They work late at Thompson Truck & Trailer, too. The truck-and-trailer dealer and service shop employs 70 in Cedar Rapids and another 130 at five locations in eastern Iowa and western Illinois.

“Our emergency line takes roadside calls to midnight,” said Erica Bellach, the company’s marketing director.

Those mechanics were among the 4,983 people in trucking-related jobs in the city last year, earning $332 million, according to David Connolly, economic development specialist for the city. An additional 2,922 jobs spun off from trucking generated $161 million. Local trucking firms saw $995 million in sales, with another $429 million in sales for those downstream businesses.

“You have everything from executive leadership all the way to a shop helper,” said Chris Hummer, president of Don Hummer Trucking. “There is typically a customer service component, there’s a planning component – capacity planning or network planning. They’re really making the matches between customers’ requirements and driver availability.”

Founded by his father in 1975, Hummer’s company employs 385 drivers and 65 others in the Corridor. There’s a maintenance facility in Homestead.

“Trucking is sort of everywhere and nowhere at the same time,” said Hummer. “As you pass one on the highway it’s difficult to get a full idea of what they’re doing and its role in the quality of life we enjoy. You see the guy who brings and Amazon package to your door or you see one of our trucks with a Target trailer, but a lot of it is not quite that transparent.”

The industry’s local role is tied to Cedar Rapids’ location and strength in agricultural processing. The city is within a day’s drive of 72 million consumers via Interstates 80 and 380 and the Avenue of the Saints linking St, Louis and St. Paul.

“We’re pretty fortunate that we’re right in the middle of the Avenue of the Saints,” Grask said. “We’re just north of Interstate 80, which is a huge corridor for the trucking industry, from the East to the West coast.”

That makes the Corridor a natural for warehousing and distribution facilities where incoming loads are broken into smaller lots for delivery or to be combined with others for continued shipment.

“There is a lot of freight consolidation activities at warehouses where people are busting up pallets (loads) or putting together pallets for shipment,” said Jeff Woods, director of business development for Travero. The Cedar Rapids-based company, a subsidiary of Alliant Energy, operates logistics parks in Fairfax and East Dubuque, Ill., where freight is transferred between modes – between trucks and Travero’s CRANDIC railroad in Fairfax, between trucks, trains, and Mississippi River barges in East Dubuque.

About half of Travero’s 170 employees work for CRANDIC. About 30 are in its brokerage division, matching customers’ loads to trucks or rail.

“We make a lot of things here that get shipped all over the country, so having that transportation resource here is absolutely critical,” Woods said. “The cost of a widget sitting on shelf in Iowa does contain a little more freight than in some other states. That’s even more of a reason to have lots of options.”