December 2016 Freight Transportation Services Index (TSI)

Parul Dubey on February 10, 2017 - in Transportation

The Freight Transportation Services Index (TSI), which is based on the amount of freight carried by the for-hire transportation industry, rose 1.0 percent in December from November, rising for the third consecutive month, according to the U.S. Department of Transportation’s Bureau of Transportation Statistics’ (BTS). The December 2016 index level (124.7) was 31.7 percent above the April 2009 low during the most recent recession (Tables 1, 2, and 2A).

Freight Transportation Services Index, December 2011 – December 2016
(Seasonally Adjusted, Monthly Average of 2000 = 100)

Table Version | Excel

Freight Transportation Services Index, December 2011 - December 2016

The level of freight shipments in December measured by the Freight TSI (124.7) was equal to the all-time high reached in July 2016 (Table 2A). BTS’ TSI records begin in 2000. See historical TSI data.

The November index was revised to 123.5 from 123.2 in last month’s release. Monthly numbers for August through October were revised up slightly and monthly numbers from January through June were revised down slightly.

The Freight TSI measures the month-to-month changes in for-hire freight shipments by mode of transportation in tons and ton-miles, which are combined into one index. The index measures the output of the for-hire freight transportation industry and consists of data from for-hire trucking, rail, inland waterways, pipelines and air freight. The TSI is seasonally-adjusted to remove regular seasons from month-to-month comparisons.

Analysis: The December Freight TSI grew by 1.0 percent from the previous month due to increases in trucking, pipeline, rail intermodal, and water, while air freight and rail carloads declined. The December increase was driven by economic growth. The Federal Reserve Board Industrial Production index (link is external) rose by 0.8 percent in December, with growth in both manufacturing and utilities, even as mining production declined. Employment (link is external) and Personal Income (link is external) both grew in December, though housing starts were off by 0.2 percent.

The 2.9 percent fourth quarter increase from the previous quarter took place as Gross Domestic Product (link is external) (GDP) growth slowed to an annual rate of 1.9 percent from 3.5 percent in the third quarter, while Industrial Production (link is external) grew by 0.4 percent. The fourth quarter slowdown in GDP growth was preceded by a third quarter decline in Freight TSI and the rapid GDP growth in the third quarter was preceded by a strong increase in Freight TSI in the second quarter.

Trend: The 1.0 percent increase in December was the third consecutive monthly Freight TSI increase. These three months of increases, following two months of declines brought Freight TSI to its highest level ever, matching the record high level of 124.7 in July 2016. The December level was 2.9 percent above the level at the start of 2016.

The 2.9 percent fourth quarter increase followed a decrease of 1.1 percent in the previous quarter, for a net increase of 1.8 percent over the last six months. The fourth quarter increase was the largest increase in freight TSI since the fourth quarter of 2011. Freight TSI increased in two of the four quarters of 2016 for an annual increase of 2.9 percent, after declining in three of the four quarters of 2015, for an annual decline of 2.0 percent. The Freight TSI is now 1.8 percent above the level of two years ago at the beginning of 2015. The index remains high compared to earlier years, rising 31.7 percent since the low of 94.7 in April 2009. For additional historical data, go to TSI data.

Index highs and lows: For-hire freight shipments in December 2016 (124.7) were 31.7 percent higher than the low in April 2009 during the recession (94.7). The December 2016 level was equal to the all-time high reached in July 2016.

Year to date: For-hire freight shipments measured by the index were up 2.9 percent in December compared to the end of 2015 (Table 3).

Long-term trend: For-hire freight shipments are up 8.2 percent in the five years from December 2011 and are up 12.6 percent in the 10 years from December 2006 (Table 5).

Same month of previous year: December 2016 for-hire freight shipments were up 2.9 percent from December 2015 (Tables 4, 5).

4th quarter changes: The Freight TSI rose 2.9 percent in the fourth quarter, the largest quarterly increase since a 3.5 percent rise in the fourth quarter of 2011 (Table 10).

The TSI uses seasonally adjusted data on for-hire freight and passenger transportation services to create three indexes measuring monthly changes in transportation services output from the base year of 2000. The three indexes are for-hire freight shipments, passenger travel, and a combined measure that merges freight and passenger indexes. See Seasonally-Adjusted Transportation Data for numbers for individual modes. TSI includes data from 2000 to the present. Release of the December 2016 index is scheduled for March 8.

Passenger Index: The TSI for passengers fell 0.1 percent in December from its November level (Table 6). The Passenger TSI December 2016 level of 124.0 was 0.3 percent below the December 2015 level (Table 7). The index is up 7.2 percent in five years and up 9.2 percent in 10 years (Table 5). The passenger TSI measures the month-to-month changes in travel that involves the services of the for-hire passenger transportation sector. The seasonally adjusted index consists of data from air, local transit and intercity rail.

Combined Index: The combined freight and passenger TSI rose 0.6 percent in December from its November level (Table 8). The combined TSI December 2016 level of 124.6 was 1.9 percent above the December 2015 level (Table 9). The combined index is up 7.9 percent in five years and up 11.4 percent in 10 years (Table 5). The combined TSI merges the freight and passenger indexes into a single index.

Revisions: Monthly data has changed from previous releases due to the use of concurrent seasonal analysis, which results in seasonal analysis factors changing as each month’s data are added.

BTS research has shown a clear relationship between economic cycles and the Freight and Passenger Transportation Services Indexes. See a study of this relationship using smoothed and detrended TSI data. Researchers who wish to compare TSI over time with other economic indicators, can use the FRED database (link is external), which includes freight, passenger and combined TSI, and which makes it possible to easily graph TSI alongside the other series in that database. See TSI data on FRED (link is external).

For a webinar on the TSI, see Past Webinars. For a video explanation of the TSI, see Overview of the Transportation Services Index. A BTS report explaining the TSI, Transportation Services Index and the Economy, is available for download.