U.S. business logistics costs remained at 8.5 percent of GDP for the second consecutive year in 2012, according to the Council of Supply Chain Management’s annual State of Logistics Report.
“2012 continued many of the same trends we have been experiencing since 2010 following the end of the recession,” said the report, written by Rosalyn Wilson, senior business analyst at Delcan Corp.
Wilson said logistics spending tracked the economy’s slow recovery, and that it appears the supply chain industry and the economy are settling into a “new normal.”
Logistics spending was estimated at 16.2 percent of GDP in 1981, when the late Robert V. Delaney began compiling the annual report. The ratio declined steadily, dropping below 10 percent in 2001.
Through the 1980s, the decline was due mainly to trucking deregulation, which reduced freight transportation costs. Improved supply chain management provided an additional boost through the 1990s.
For more than a decade, the ratio of logistics costs to GDP has fluctuated within a narrow range, in line with the economy’s health. The ratio plummeted to 7.9 percent in 2009, but only because slow sales forced companies to order and ship fewer goods.
The ratio recovered to 8.3 percent in 2010 before plateauing at 8.5 percent during the last two years.
Logistics costs increased 3.4 percent last year, to $1.33 trillion. Inventory costs increased 3.4 percent. Transportation, the main component of logistics costs, rose 3 percent, held back by weak volumes and rates.
Wilson said the outlook is for more of the same through 2015, with slow and inconsistent economic growth and logistics costs keeping pace.
“Given the world economic picture and the economic dependency we have on our trading partners, there are no indicators that we can expect any dramatic shifts,” she wrote. “I do believe that the economy and the logistics sector will slowly gain sustainable momentum, but that we will still experience unevenness in growth rates.”