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Record-High U.S. Business Logistics Costs in 2022

by Daisy D.
06/20/2023
in Logistics & Transportation


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According to the recently released 2023 State of Logistics Report, titled “The Great Reset,” U.S. business logistics costs (USBLC) reached an all-time high in 2022, surpassing $2.316 trillion. This amounted to 9.1% of the U.S. nominal gross domestic product (GDP) for the same year.

The report, compiled by the Council of Supply Chain Management Professionals (CSCMP), noted a substantial year-on-year growth of 19.6% in U.S. business logistics costs compared to the previous year, which stood at $1.937 trillion in 2021.

Transportation costs in the United States also witnessed a notable increase of 7.4% year-on-year, rising from $1.2960 trillion in 2021 to $1.3914 trillion in 2022.

Among the various components of logistics spending, road freight and transportation claimed the largest share, reaching $896 billion in 2022. This represented a 6.1% increase from the $844.5 billion spent in 2021. Rail costs also experienced a significant boost of 17.6% year-on-year, rising from $84.4 billion in 2021 to $99.2 billion in 2022.

Despite consumers returning to brick-and-mortar stores for their purchases, e-commerce sales continued to thrive. In 2022, e-commerce sales increased by 8% year-on-year, reaching $1.034 trillion, which accounted for 14.5% of the entire U.S. retail market at that time.

The report also highlighted the technology investments made by third-party logistics providers (3PLs). Among the surveyed respondents, 96% of 3PLs indicated that they had transitioned their operations to the cloud, while the figure for shippers was 86%. Moreover, 80% of 3PLs invested in the Internet of Things (IoT) in 2022, slightly ahead of shippers at 77%.

One significant disparity between 3PLs and shippers was in the realm of real-time data. More than half of third-party logistics providers (51.5%) stated that their supply chain services offered real-time data, while less than a third of shippers (31.5%) reported providing real-time data in their supply chain offerings.

The report also highlighted the ongoing trend of reshoring in the U.S., with American imports of Mexican-manufactured goods increasing by 26% since the spring of 2020, according to Kearney’s Reshoring Index, which tracks the relocation of manufacturing operations back to the U.S. from low-cost countries and regions.

In the report’s executive summary, the authors suggested that supply chain demand might remain stagnant or even decrease for the remainder of 2023 due to various factors, including lingering economic uncertainties at both the global and U.S. levels.

The 2023 State of Logistics Report is an annual publication produced by the CSCMP, in collaboration with the global consulting firm Kearney and presented by Penske Logistics. Data for the report was collected throughout the 2022 calendar year and the early months of 2023.

Get the newest updates in supply chain logistics news on The Supply Chain Report. Visit ADAMftd.com for free international trade tools.

#2023StateOfLogistics #USBLC #LogisticsCosts #USGDP #BusinessLogistics #TransportationCosts #RoadFreight #RailCosts #EcommerceGrowth #3PL #CloudTechnology #IoT #RealTimeData #Reshoring #AmericanImports #Kearney #PenskeLogistics #CSCMP

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