Logistics economy continues extended growth run
Logistics Manager’s Index slows in September but remains in high-growth territory for the eighth straight month, report shows.
The logistics economy continued its extended growth run in September, driven by accelerating demand for supply chain services worldwide, according to the latest Logistics Manager’s Index (LMI) Report, released today.
The LMI registered 72.2 in September, down from its August reading of 73.8, but still well above the 50-point mark indicating economic expansion across warehousing, transportation, and logistics markets. The LMI has remained above 70 since February, indicating rapid growth throughout the industry, according to LMI researcher Zac Rogers, assistant professor of supply chain management at Colorado State University.
“We’re way, way above where we have normally been,” Rogers said, pointing to an extended growth peak that began in the spring of 2020 and marks the longest growth stretch in the five-year history of the LMI. “This is the longest high peak we’ve seen.”
The expansion is being driven by high prices across the industry. Warehousing and transportation prices remained high during the month, as did inventory costs; warehousing prices reached an all-time high LMI reading of 89.3. The growth was tempered by a decrease in growth for inventory levels, however, which is likely “due to a combination of inventory moving quickly due to high consumer demand, but also coming in slowly due to logistics delays,” Rogers added.
Logistics managers are predicting more of the same over the next 12 months. The September future predictions index registered 72.6, representing a “significant rate of predicted growth,” according to the report.
The LMI tracks logistics industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
Visit the LMI website to participate in the monthly survey.