After hitting a new record high in May, a measure of the amount of freight moved by the nation’s for-hire transportation industry declined in June, according to new Transportation Department figures.
Its Freight Transportation Services Index (TSI) declined 0.8% in June to a level of 126.2 from the month before while the May reading was revised upward to 127.2 from 126.8 and remains at an all-time high. Monthly numbers for January through April remained virtually unchanged.
Even with this drop from the month before the Freight TSI was at its second highest level of all time, exceeding the level from April by 1.6%. So far this year, while there have been four months when TSI declined, and only two months when it increased, the net increase in 2017 has been 1.3% because of the large increase in May.
Despite the month-to-month drop in June, for-hire freight shipments increased 2.9% from June 2016.
The Freight TSI measures the month-to-month changes in for-hire freight shipments by mode of transportation in tons and ton-miles, which are combined into one index. The index consists of data from for-hire trucking, rail, inland waterways, pipelines and air freight.
According to the department, the June decline from the previous month was due to significant decreases in trucking and water while air freight and rail carloads and intermodal grew. Pipeline remained steady.
“The increase ran counter to mostly rising trends in other economic indicators,” the report said. “Employment, housing starts and personal income grew. The Federal Reserve Board Industrial Production index rose by 0.4% in June, due to growth in manufacturing and mining. The Institute for Supply Management Manufacturing index rose to 57.8, indicating accelerating growth.”
While the monthly TSI declined, the quarterly TSI covering a three-month period rose. The 1.4% second quarter growth in the freight TSI was consistent with the accelerating pace of gross domestic product annual growth, which reached 2.6% in second quarter 2017, up from a revised annual rate of 1.2% growth in the first quarter.
Since the beginning of 2015, the Freight TSI has not increased in two consecutive quarters, following the period from the fourth quarter of 2012 to the fourth quarter of 2014 when it increased every quarter.
The index remains high compared to earlier years, rising 33.3% since the low of 94.7 in April 2009, which is shortly before the end of the “Great Recession.”
For-hire freight shipments in June 2017 were 33.3% higher than the low in April 2009 during the recession while they are up 11.2% in the five years from June 2012 and up 15% percent in the 10 years from June 2007.
This follows a report from a couple of days earlier showing trucking freight has increased nearly 38% since the end of the economic recession, the second highest growth rate of any freight transportation mode.