For-Hire Freight Level Continues Hitting New Record Highs

A U.S. Transportation Department measure of the amount of freight moved by the nation’s for-hire transportation industry reached another all-time monthly high in September, according to newly released figures, rising 0.2% above the previous highest level hit a month earlier.

The Freight Transportation Services Index (TSI) reading of 129.9 in September is also 6.7% higher than compared to the same time a year ago and is the largest year-over-year hike since December 2010.

The August index was revised downward to 129.0 from 130.7 in last month’s release. Monthly numbers for January through March and May were revised up slightly.

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 and consists of data from trucking, rail, inland waterways, pipelines and air freight.

Significant increases in trucking and pipeline led the September increase in the Freight TSI while other modes declined, according to the department.

The TSI increase took place against a background of mixed results for other indicators. The Federal Reserve Board’s Industrial Production index rose by 0.3% in September, with increases in all sectors. Also, employment rose, personal income grew and the Institute for Supply Management Manufacturing index rose to a level of 60.8, indicating accelerating growth. In contrast, housing starts fell by 4.5%.

The 2.4% increase in Freight TSI in the third quarter was consistent with the pace of growth of the nation’s gross domestic product (GDP), which was 3% in the third quarter. GDP growth had been 3.1% in second quarter, when Freight TSI also grew. GDP growth was slower in the first quarter of 2017, when Freight TSI declined.

The Freight TSI’s new all-time high in September is also 3.5% above the level of 124.9 from July 2016, which was the highest level prior to 2017. September was the third all-time high in a row, and the fourth in five months.

Every month since November 2016 it has exceeded the level of all previous months except July 2016. All six of the Freight TSI’s all-time highest months have been in 2017. Each of these months exceeded the pre-2017 high in July 2016 by at least 1%.

Over the last six months, the index rose 3.8% with the third quarter 2.4% rise following the second quarter increase of 1.4%. The two consecutive quarterly increases were the first since the beginning of 2015.

The September index was 36.3% above the April 2009 low during the most recent recession.