Continued Strength in Freight Points to Economic Growth
North American freight shipments and expenditures continued to buck the historic trend and increased again in May.
According to Cass Transportation, the first five months of 2014 were the strongest since the end of the great recession.
While this seems counter to the dismal GDP reading for the first quarter, which shows a one percent drop or a contraction in the economy, much of the decrease in GDP can be attributed to declining inventories, slowing exports and weather‐related issues.
May shipment volumes rose 1.0 percent to the highest level since October 2011. This was the fourth month in a row that the number of shipments increased.
May shipments were 3.6 percent higher than a year ago and 26.4 percent higher than shipment levels at the end of the 2009 recession.
Capacity problems are being experienced in both the trucking and the rail industries as volumes grow. The impact of productivity‐reducing truck regulations has exacerbated the driver shortage, further limiting capacity despite the strong growth in the size of the truck fleet in 2014.
Freight expenditures climbed up 1.1 percent in May, setting another record high.
Spending was 11.2 percent higher than a year ago and 77.7 percent higher than at the recession’s end in 2009.
Category: General Update, Management
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