In June, CSCMP released its 26th Annual "State of Logistics Report," presented by Penske Logistics, at a press conference at the National Press Club in Washington, D.C. The spacious room was filled to capacity—and not just with reporters. Logistics and supply chain consultants, service providers, researchers, and more were there too.
And with good reason: The highly anticipated report, authored and presented by transportation consultant Rosalyn Wilson of Parsons, provides an overview of the economy during the past year, the logistics industry's key trends, and the total U.S. logistics costs for 2014. The research concludes with a look at industry indicators for the first half of 2015 as well as thoughts about performance for the remainder of the year. During the event, a panel of executives from BNSF Railway, Boeing, Domino's, Penske Logistics, Sustainable Supply Chain Consulting, and Yusen Logistics discussed how the trends identified in the report are playing out day to day in their businesses.
That's information no other organization provides, and CSCMP is proud to present these important statistics and industry insights with support from Penske Logistics. This critical industry intelligence will not only help our members do their jobs better, but also better prepare them for the business demands ahead. Knowing how logistics and supply chain costs affect and are affected by the larger economy is a key part of this understanding.
It's no secret that the news has not been good for the past few years. The recession and its aftermath depressed demand for consumer goods, construction, and manufacturing. That, of course, translates into less demand for transportation and logistics services. But as Roz Wilson pointed out in her presentation, the tide began to turn last year, and in 2014 the logistics industry experienced its best year since the Great Recession.
One indicator is that total U.S. business logistics costs rose to $1.45 trillion in 2014, a 3.1 percent increase from the previous year. Another is that the transportation sector grew by 3.6 percent in 2014 due to stronger shipment volumes rather than higher rates. With the U.S. economy on solid ground, consumer spending increased and freight levels climbed as retailers replenished inventories. Truck tonnage boomed, rail traffic and high-value air shipments reached record levels, container movements through U.S. seaports rose, and demand for third-party logistics services grew. Meanwhile, the national vacancy rate for warehousing declined to 7 percent.
That's great news, but it also highlights an issue of concern to all of us. As demand for logistics services increases, it becomes more urgent than ever to address the growing shortage of logistics and supply chain professionals who keep our supply chains running. You can be sure that even as we celebrate the great year our industry experienced in 2014, we at CSCMP will be working hard to help our members acquire, develop, and retain the talent they need to keep up with the growing demand for their companies' products and services.