There is no summer vacation for logistics and the economy

With summer officially here, that means many different things for people, whether it be fun in the sun in the form of beaches, boats, vacation, going to ballgames and many other things.

It also serves as a welcome change to a more “relaxed” time, hopefully, for all of us to some extent. While that sounds good in theory and looks good on paper, it by no means applies to the hectic world of transportation and logistics…at all.

Yes, the season has changed but the key elements all remain intact, some are good and some are not so good to be sure.

One thing that remains unchanged is sluggish freight transportation volumes for all modes. There are a few factors behind that, but the two that appear to stand out the most remain sluggish demand and still-high inventories.

A while back, the elevated inventory levels were definitely “noticed” but not necessarily viewed as a major cause for concern, at least at that time. But as the days and months have peeled off the calendar over the course of 2016, these high inventories are still around and still worrisome, if not more than they were before, because, well, it remains an issue, with no clear cut ending or solution in sight.

And until existing inventories are cleared out, the situation remains in a state of flux, so that is something that requires an ongoing watchful eye, until we see some real movement.

Conversely, and somewhat of a contradiction, though, is how consumer confidence levels are on the positive side. It is a contradiction in that based on the most recent University of Michigan index of U.S. consumer sentiment for the month of June, “satisfaction with the current state of the U.S. economy hit an 11-year high in June, but Americans continued to lose confidence in the future,” stated a Wall Street Journal report.

It is fair to say what happens in the future is absolutely a legitimate concern, what with a mere 38,000 new U.S. jobs added in May, coupled with very low GDP output at the moment, too.

While summer is here and is a time for fun, it is obvious that the underlying economic concerns we are facing don’t get to go on vacation. What happens from here is anyone’s guess, but it is fair to say it will not be dull from a logistics perspective at all.