Some key economic indicators are shining amid these interesting times

While it feels like “old news” by now, it still never surprises me to see just how interconnected the trio of logistics, supply chain and freight transportation have become ostensibly interwoven in all parts of our lives, specifically as consumers.

Make no mistake, and it has been said before, the COVID-19 pandemic really changed just about everything we address, ponder, and evaluate when it comes to how business processes are handled. That goes from initial furious rush on things like toilet paper and other consumer staples, poultry and other types of foods, and the many consumer-based items that we all bought (think home improvement-related items), among others.

Of course, logistics, supply chain, and freight transportation were front and center for all of this and clearly continue to be, as has been highlighted now for more than a year, going back to the outset of the pandemic in March 2020.

When we take a moment and look back, there have been more than a few signature moments that had major logistics implications, whether it be the shortage, or delivery delays, of many key consumer staples (that has somewhat subsided now, based on product type), the Suez Canal incident, the semiconductor shortage, port congestion, the heightened supply and demand imbalance in the truckload market, and, of course, rising freight rates, too.

Clearly those things have presented more than a few challenges, but, at the same time, we have seen a dramatic turnaround in key metrics for things such as freight volumes (i.e. tonnage) that were very negatively impact by the pandemic.

As an example, total United States rail intermodal volumes, from January through May, posted its highest numbers ever for that period, according to the Association of American Railroads (AAR).

Another example highlighting the strong economic activity we are seeing (with its goods moving through the supply chain) includes April U.S.-bound imports coming in at 2.15 million TEU (Twenty-Foot Equivalent Units), marking a 33.4% annual gain, for its best April reading ever, compared to April 2020, when the majority of stores were closed, due to the pandemic, according to the Port Tracker report issued by the National Retail Federation (NRF) and Hackett Associates. This came on the heels of March’s 2.27 million TEU, the record-high for any month, going back to when NRF first started tracking imports.

Things remain steady on the retail sales front, too, with consumer spending moving at a steady clip, while retail inventories remain very low, due to what could be politely called supply chain challenges, in the form of tight trucking capacity, port congestion, and an ongoing labor shortage.

What’s more, with many Americans getting vaccinated, the services-based economy is riding high, with May’s ISM Services PMI reading hitting its highest level on record. The reading for the report’s key indicator—the Services PMI (formerly the Non-Manufacturing PMI)—at 64 (a reading of 50 or higher indicates growth is occurring) —headed up 1.3% from April to May, with the index growing, at a faster rate, for the twelfth consecutive month.

There is also the GDP, for which IHS Markit recently upped its 2021 forecast from 6.7% to 7.4%, and from 4.7% to 4.8% for 2022. Granted, these numbers are aided by the post-pandemic rebound, but they still are very strong (and impressive).

While many supply chain challenges remain intact and many paths to remedy them are unclear, at the moment, it is encouraging to see these strong economic data points, without question. And it is important to remember that the supply chain is tied into all of them, in one way of another. Things may not be perfect, but they are certainly better than they were a year ago. That is for sure.