A drop in truck tonnage in October could be another sign that the economic recovery is slowing, but it also may be a case of seasonal trends thrown off by the pandemic.
American Trucking Associations’ advanced seasonally adjusted For-Hire Truck Tonnage Index fell 6.3% in October after gaining a revised 5.7% in September. In October, the index equaled 106.8 (2015=100), compared with 114 in September.
Looking at year-over-year numbers, compared with October 2019, the seasonally adjusted index contracted 8.7%, the seventh straight year-over-year decline. Year-to-date, compared with the same period in 2019, tonnage is down 3.9%.
“While there are indications that the economy is losing momentum, I believe October’s tonnage softness was more of a seasonal issue during a pandemic than anything else,” said ATA Chief Economist Bob Costello. “Typical seasonality is off this year, and it was a reason why October was down so much,” he said in a release.
On Twitter, he explained, “Normally, before seasonal adjustment, there is a big jump from September to October, but not this year, because September was stronger, much stronger, than normal.”
The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 114.4 in October, 2.7% above the September level (111.4).
The not seasonally adjusted tonnage was down a fraction as much as normal over the last five years during September, Costello explained in the news release, leading to a big seasonally adjusted gain. However, that means October’s not seasonally adjusted tonnage grew less than half as much as it typically does, leading to a big drop in the seasonally adjusted figure.
“There are plenty of carriers still saying that tonnage, retail tonnage in particular, is good,” he said in the release, adding on Twitter, “However, not all freight is strong. And, there are indications that the economic recovery is moderating.”
September’s gain was revised down to 5.7% from ATA’s Oct. 20 20 press release.
ATA calculates the tonnage index based on surveys from its membership and has been doing so since the 1970s. In calculating the index, 100 represents 2015. ATA’s For-Hire Truck Tonnage Index is dominated by contract freight as opposed to spot market freight. This is a preliminary figure and subject to change in the final report issued around the 5th day of each month. The report includes month-to-month and year-over-year results, relevant economic comparisons, and key financial indicators.