Ceridian-UCLA Pulse of Commerce Index down 0.6 percent in October
November 10, 2010
Like in previous months, stagnant freight volumes, especially on the trucking side, appear to be the norm., according to the most recent Ceridian-UCLA Pulse of Commerce Index (PCI), which reported a 0.6 percent decline in October.
This decline follows a 0.5 percent and 1.0 percent declines in September and August, respectively, marking the PCI’s first three-month decline since January 2009.
The PCI, according to Ceridian and UCLA, is based on an analysis of real-time diesel fuel consumption data from over-the-road trucking and is tracked by Ceridian, a provider of electronic and stored value card payment services. The PCI data is accumulated by analyzing Ceridian’s electronic card payment data that captures the location and volume of diesel fuel being purchased by trucking companies. It is based on real-time diesel fuel purchases using a Ceridian card by over the road truckers at more than 7,000 locations across the United States.
The PCI closely tracks the Federal Reserve’s Industrial Production data as well as GDP growth.
“The October data begins the fourth quarter on a down note. October is also an especially important siren for the holiday season,” said Ed Leamer, chief PCI economist and director of the UCLA Anderson Forecast, in a statement. “We have had a recovery ‘time out. Since May’s peak, trucking has receded 8.3 percent. Fortunately, the full stew of economic information does not appear to foretell a double dip in the coming. Rather, the economic malaise that set-in this summer is still very much with us.”
On a year-over-year basis, the PCI is up 4.1 percent compared to October 2009, but the report points out that annual PCI increases have been declining since May 2010, which was up 9.0 percent compared to May 2009. Since that time, June was up 8.6 percent, July was up 8.0 percent, August was up 6.0 percent, and September was up 5.8 percent.
And with October showing continued slow growth the PCI report said that with October typically being a peak month for domestic trucking, a disappointing holiday season may be en route.
“The key message here is that the economy has stalled,” said Todd Dooley, Ceridian Senior Vice President of Finance, in an interview. “It has not grown on a sequential basis since May and that does not bode well in a broader sense. The slight silver lining on an annual basis is that the economy is continuing to grow, albeit at a slower rate than when it peaked in May.”
Dooley said that the current situation falls short of the type of economic recovery that is needed to put people back to work and make people feel comfortable about the economy again, which has been a consistent message of the PCI, especially in recent months.
What’s more, there are not any clear signs to change that outlook in the fourth quarter, which is worrisome, explained Dooley.
This has been made evident by sluggish consumer spending and an unemployment rate still hovering just below ten percent, among other economic indicators.
Subscribe to Logistics Management magazine
entire logistics operation. Start your FREE subscription today!