Trucking Activity Index Drops 0.6 Percent in October

The Ceridian-UCLA Pulse of Commerce Index fell 0.6 percent in October, pointing to a drop in trucking activity in what's typically a strong month for truck traffic.

That should sound alarms about economic growth in the fourth quarter, as retailers remain wary about sales prospects, said Ed Leamer, PCI chief economist. "The economic malaise that set in this summer is still very much with us."

The Ceridian-UCLA index measures economic activity by electronically tracking the volume and location of diesel fuel sold to truckers across the U.S.

By The Numbers: U.S. Diesel Prices.

Data collected through Ceridian's card-based fuel purchasing network captures over the road movement of raw materials, goods-in-process and finished goods.

October was the third consecutive month of decline for the index -- its longest period of decline since January. The index is still 4.1 points higher than a year ago, which indicates the economy is still growing but at a much slower pace.

"We have had a recovery 'time out,'" said Leamer, who is director of the UCLA Anderson Forecast at the University of California-Los Angeles. "Since May's peak, trucking has receded 8.3 percent," Leamer said.

The index's findings corroborate the accounts of individual carriers and the third quarter earnings reports of publicly traded trucking companies.

Many truckload and less-than-truckload carriers reported a drop in shipment volume this summer and early fall from higher levels in the second quarter.

The monthly year-over-year increase in the PCI index dropped starting in May, falling gradually from 9 percent that month to 4.1 percent in October.

That 4.1 percent PCI growth figure for October translates into a 1.3 percent year-over-year GDP growth, according to the index.

Despite the month-to-month decline, the index has grown year-over-year for 11 consecutive months," said Craig Manson, senior vice president at Ceridian.

"This means the holiday sales season will likely be better than last year, but potentially disappointing versus current expectations in the marketplace," he said.

-- Contact William B. Cassidy at wcassidy@joc.com.