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logistics and retail updates

This series of updates aims to bring relevant government and industry statistics to life. As part of our assignments, we often help clients source both internal and external data, and then use it to drive logistics modelling, benchmarking, budgeting ...and action plans! To find out how we can help you by ringing 01295 758875 or contact us. If you'd like an alert when a fresh update is posted, ask us to email you or follow on Twitter:

17 January 2017: Hiding our heads in the sand?

Earlier today the ONS (Office for National Statistics) published the latest inflation figures. All the headlines are about the CPI. the Consumer Price Index. It's understandable in part - that's what affects how far the pound in the pocket goes, and it's what the Bank of England is targeted to influence. But the real news is the PPI, the Producer Price Index*, and in particular what's happened to input prices over the past year.

Inflation in factory gate prices was 2.7% for the year to December 2016, so ahead of the CPI at 1.6%, but not particularly scary. But the overall inflation on prices for materials and fuels paid by UK manufacturers for processing (input prices) was 15.8% for the year, largely as a result of exchange rates and the price of crude. The graph below shows that the headlines should be about the constituent parts of PPI input - imported metals up 36.2% and crude oil 56.7%.

So, as a nation, are we hiding our heads in the sand by ignoring these input figures? Actually, turns out sand would be a good place to be, with only circa 1% inflation in those sorts of supplies over the past year.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - PPI - Producer Price Index - 1 November 2016 - ONS - Inflation - Crude Oil - Manufacturing Statistics

*The PPI consists of two main measures - here's the ONS own description of them:

The factory gate price (output price) is the amount received by UK manufacturers for the goods that they sell to the domestic market. It includes the margin that businesses make on goods, in addition to costs such as labour, raw materials and energy, as well as interest on loans, site or building maintenance, or rent.

The input price measures the price of materials and fuels bought by UK manufacturers for processing. It includes materials and fuels that are both imported or sourced within the domestic market. It is also not limited to materials used in the final product, but includes what is required by businesses in their normal day-to-day running, such as fuels.

Please feel free to share:

5 January 2017: Low footfall

Earlier today IPSOS Retail Performance published a piece which reported that footfall on the UK high street was 9.3% down on December 2015

I can well believe that, having gone shopping at Banbury Gateway Retail Park on Saturday 17 December - to say that it was dead was to put it mildly - I've put together a document with some photos I took. The pictures aren't great for a couple of reasons - photography is not a core skill of mine and I was only taking the pics to show my husband how empty it was. As time went on, I did get into my theme, so I fully admit that I waited for a shopper to get out of the way for one or two of the later shots ...but partly so they didn't think I was snapping them as individuals! Here are my pics.

What were your Christmas shopping experiences like?

29 November 2016: Road Freight Flatlining

Last week the ONS (Office for National Statistics) published the latest SPPI* figures, and I was struck by how little movement there has been in the road freight element of the index over the past few years. You can see this (the bright pink broken line) in the graph below and also some major constituent costs of road transport. The SPPI is not seasonally adjusted, but I've displayed only the Q3 figures for each year (the most up-to-date figures for the SPPI which is a quarterly index) so they represent the same season year on year.

In terms of the major constituent costs, I've included driver wages (two sources** in shades of yellow/brown); the purchase cost of an artic unit (another two sources** in shades of blue); and diesel (two alternative sources** in shades of green). All of the costs have been brought back to an index of 100 for 2012 so that the relative movement can easily be seen.

While wages have increased over the past four years and the cost of the tractor element of the truck has ended up at about the same as 2012 (although with alternative sources indicating different price movements during that period), diesel has dropped dramatically to less than 80% of the price it was in 2012.

It's interesting that the result of all these ups and downs is what your local hospital would call "flatlining"! How does this compare with your experience?

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - SPPI - Service Producers Price Index - 29 November 2016 - ONS - Diesel - HGV driver wages - artic unit capital cost - Logistics Statistics

*The Service Producers Price Index is a bit like the CPI - it shows the increase in prices and rates paid, but for services provided by businesses to other businesses and government. It provides a measure of inflation for the UK service sector with individual price indices, such as Freight transport by road, aggregated to create a service industry index. It does not aim to provide full coverage of the "service sector" - the primary use of the SPPI is as a deflator in the UK National Accounts.

**Sources for data for the cost breakdown elements are as follows:

Croner LGV C+E driver average weekly earnings - Croner Distribution & Transport Rewards

FTA LGV driver pay gross weekly - FTA Report on The Driver Shortage: Issues and Trends

MT 44T unit 6x2 - Motor Transport annual cost tables

RHA 44T unit 6x2 - RHA annual cost tables

AA Pump Diesel (Aug) - AA Fuel Price Report

FTA Bulk diesel (on or near 16 Aug) - FTA Fuel Price Information

11 November 2016: 8 out of 10 employees...

Following my previous post, someone asked me about how pay relates to hours worked, so I've combined two of the many data sets from the Office for National Statistics' Annual Survey of Hours & Earnings in the diagram below.

What are the boxes in the diagram all about? It's my attempt to show the span of hours and span of pay for most people working in the UK as a whole and for some specific occupations. Unlike the previous update, I've used the figures for all employees (not just full-time). See below the diagram for a description of how to read the it.

Aricia Update Diagram - ASHE - Annual Survey of Hours & Earnings - 11 November 2016 - ONS - Hours - Wages - Logistics Statistics

On the x-axis is paid hours worked per week - the span of each box goes from the figure for the 10th percentile through to the 90th - you can see the previous update for a description of percentiles, but if we look at the red box for the UK as a whole, it means that 80% of employees work somewhere in that span of hours (so it excludes the extremes at each end). And the y-axis shows gross weekly pay, and again the span runs from the 10th to 90th percentiles, so that 80% of employees get paid somewhere in that span.

It's important to note that it will be a different 80% for the x and y elements of each box, but there will be a broad overlap. Also, note that for ease of representation, the boxes go to the nearest 2.5hrs and the nearest 50. And it'simportant to consider that this is for "paid hours per week" - it is quite likely that, for instance, managers and directors may well be working more hours than they are technically paid for.

I've included particular occupations for particular reasons:

  • UK (Red) = All employees - and note the red spot which marks both median hours and median pay - so 50% of people in the UK have less paid hours per week and 50% of people have less gross weekly pay than indicated by the spot
  • Code 82 (Blue) = Transport and mobile machine drivers and operatives - as we saw before, this group has the highest hours at the 90th percentile and will include HGV drivers
  • Code 92 (Green) = Elementary administration and service occupations - included as both the lowest hours at the 10th percentile and the lowest paid at the 10th percentile
  • Code 11 (Grey) = Corporate managers and directors - the highest paid at the 90th percentile
  • Code 8 (Yellow) = Process, plant and machine operatives - the second highest hours at the 90th percentile

NB ASHE covers employee jobs in the United Kingdom - it does not cover the self-employed, nor does it cover employees not paid during the reference period.

1 November 2016: Driving - the nation's hardest workers

I wasn't intending to revisit the topic of drivers' hours, but last week the ONS (Office for National Statistics) published the latest Annual Survey of Hours & Earnings. Among a wide variety of statistics, they include paid hours worked by occupation, one of which is "Transport and mobile machine drivers and operatives" - wider than HGV drivers, it includes approx 670K full-time workers.

A quick explanation before looking at the graph. The median is the value below which 50% of jobs fall. It is ONS's preferred measure of average as it is less affected by a relatively small number of very high values. It therefore gives a better indication of "typical" than the mean. And percentiles mark the values below which certain proportions of jobs fall - for example, the 75th percentile is the value below which 75% of jobs fall.

What the graph below shows is the estimated hours worked per week across all occupations in the UK (red) and those worked for Occupation Code 82, Transport and mobile machine drivers and operatives (blue). The different shading shows median (deep colour), 75th percentile (lighter colour) and 90th percentile (outline only).

It can be seen that this occupation grouping, which includes HGV drivers, works considerably more hours than the UK average for full-timers (to which, of course, it is a contributor), and is the occupation (out of 34 groups) with the highest median, 75th and 90th percentiles.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - ASHE - Annual Survey of Hours & Earnings - 1 November 2016 - ONS - Drivers Hours - Logistics Statistics

Some other notes: ASHE covers employee jobs in the United Kingdom. It does not cover the self-employed, nor does it cover employees not paid during the reference period. I've used the figures for full-time (so no part-time employees included). It should be noted that these figures are provisional and are accompanied by indications of their likely accuracy.

24 October 2016: Could Brexit deliver positive change in UK logistics?

The newspapers are currently full of all the disadvantages, both realised and potential, that arise from the "decisive result"* in the EU referendum. Assuming the country does go ahead with Brexit, there is potential improvement it could bring to the logistics industry and that is revision of hours rules that apply to drivers of heavy goods vehicles on non-international journeys.

In fairness to the EU, I think that the legislators had envisaged time would be more controlled by the amount of driving that could be undertaken, and hadn't foreseen a situation where the UK driver's life consisted of so much hanging around for one reason and another. Are the long days that have resulted, certainly in this country, one of the things that stops driving being an attractive job option?

Before EU drivers' hours regulations came along, the Transport Act of 1968 restricted the driver's working day to 12.5 hours through what was referred to as "spreadover".

And that was the case up until the amendments in 1986, which abolished the 1968 limits on driver duty when a driver was covered by EC rules - the new provisions on rest periods within the EC rules were seen as effectively limiting the hours for which a driver could be on duty.

In 2005 the Working Time Directive was applied to the road transport industry, with the very weak interpretation of PoAs (Periods of Availability) that was adopted in the UK. And that weak interpretation was accompanied by a casual approach to its use, in many ways turning what should have been protective legislation into just another administrative task.

However, until 2007, any reduction in daily rest from 11 to 9 hours still had to be made up by the end of the following week. After EC regulation 561/2006 was introduced in April 2007, no rest compensation was required.

Could a return to the past be helpful? Certainly pay would need to reflect the change as drivers would still have the same rent to pay and families to feed. It would not be an easy pill for industry to swallow. But I'm interested in how much could be made up for by efficiencies: reducing PoAs, which are often effectively an admission of wasted driver time. Would limiting the length of the working day back to the 12.5 hour spreadover help to make the job more attractive?

That change in April 2007 means that each and every week can include three 15 hour days. And after each of those 15 hours days, the driver needs to travel home, eat and say goodnight, before sleeping for a few hours and then getting up again ...quite probably at what I've seen described as stupid o'clock. Would you want to work those hours?

*37.4% of the UK electorate voted "Leave" in the EU referendum.

As this update is more of a blog, with no statistics as such, I've gone for a Wordle rather than a graph this time - click the pic to see how to create your own:

Aricia Update - Brexit - drivers hours - legislation - spreadover - 24 October 2016 - Logistics - Wordle

Update on 9 Nov: It's great to see this piece reported on in Transport Operator as part of a piece on driver wages.

30 April 2016: Think of all that cleaner air

Truck drivers may be getting older, but their vehicles are getting younger.

Earlier this month the Department for Transport published its vehicle registration figures for 2015, showing a 39% increase in the number of artics newly registered compared with 2014. This is no great surprise - I reported just over a year ago on the impact that Euro emissions legislation was having on goods vehicle registrations.

What the graph below shows is the percentage of artics that were less than a year old at the end of 2015 and those between one and three years old. You can see the recession, but also the recent impact that Euro VI had on purchasing decisions. And we're now at a point (not shown on graph) where the number of units under six years old can be presented as 75% if you round up the decimals ...the first time in 10 years that you've been able to say that. These trucks will represent the vast majority of trunking mileage - think of all that cleaner air.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update - goods vehicle registrations - 30 April 2016 - DfT - logistics statistics

14 April 2016: The Productivity puzzle

The news that UK productivity dropped in the final quarter of 2015, set me thinking about the productivity puzzle again. The productivity puzzle is different from the productivity gap - the productivity gap is about our country's output per hour being markedly lower than some others in the developed world.

The productivity puzzle, however, is about why our output per hour hasn't picked up again post-recession. Everyone can understand why it dropped off during the recession, but why won't it pick up again? And when I say everyone, I mean everyone including the Bank of England ...and for a while. The graph below is not one I've created myself, but one from a speech by Martin Weale, External Member of the Monetary Policy Committee at the end of 2014. Cont below graph.

To access Martin Weale's speech, please click on the graph itself.

Aricia Update - Productivity Puzzle - 14 April 2016 - GDP - Retail sales - internet - homeshopping - Statistics

However, I think that puzzle may be down to us. Logistics has facilitated the home shopping revolution. And with it a world where instead of merchandise being delivered to stores in relative bulk, items now have to be individually picked and packed. Then delivered to people's homes, not once but possibly a couple of times, until the driver finds someone available to accept the parcel. And it doesn't stop there, because a good proportion of those goods then comes back again as returns. So say, for the sake of argument, 75% of the goods are retained by the customer - they just have an uplifted work content. But for the other 25%, all that work so far has been in vain, and now they have to be got back to base and reprocessed. Lots of extra hours for no gain.

Now, at the beginning of the recession, online was still at a low-ish level. The Office of National Statistics only publishes internet sales from the end of 2006, as prior to that no-one had considered it significant. But now internet sales represent 12.5% of retail sales of 340Bn. GDP is 1.8Tn.

In a period of unemployment combined with a desire to experiment, and a desperate need by retailers to boost sales, has the logistics industry actually facilitated a sort of negative productivity - not for ourselves, but for our country? And with Black Friday and the normal madness of peak, I rest my case, and point to my evidence, M'lud: productivity dropping off in the last quarter.

I'd like to pull together some comparable statistics across a variety of companies so I can increase the credibility of some elements of my calculations. So if you work in a retailer with both bricks & clicks, or for a 3PL processing returns, or in a parcels company doing home deliveries, and would be happy to share some statistics with me on a confidential basis, please get in touch.

1 April 2016: MOD answers on vampires

I'm breaking with tradition for this post - I'm not including a graph. But that doesn't mean this post isn't about statistics. And I'm also breaking with tradition for this date - this isn't an April fool, it's not a joke piece. This is a plea to take Freedom of Information seriously, by using this day of jokes to draw attention to some of the questions that our public organisations are expected to answer...

Aricia Update - Not April Fool - 1 April 2016 - MOD - Freedom of Information - FOI - Statistics

For instance, this one addressed to the MOD: How many cases were reported to your constabulary that had one of the following items being reported - Aliens, UFO, Werewolf, Vampire, Magic or any other unknown phenomenon that could be considered occult? If you're interested, you can read the answer here. Now I don't know why that question was asked, and it may have been serious, but equally it may have been asked by a funster ...and I'm not without a sense of humour and confess to a wry chuckle.

But I'd like to log that I've been very impressed recently with the responses I've received to Freedom of Information requests, including from the MOD - polite, helpful beyond a pat answer, happy to answer additional questions and note any provisos, and, in most cases, timely. So, I hope that, when there are questions about werewolves etc, it cheers up the life of someone who's normally being asked boring questions like how many HGV licence holders there are in the military.

Thank you all!

21 March 2016: Warehousing - all TOPSI Turvy

What's happening in warehousing? On Friday last week, the latest figures for the delightfully-named TOPSI* (Turnover and Orders in Production and Services Industries) were released by the ONS (Office for National Statistics), revealing that the turnover figure for warehousing had dropped yet again in January - its seventh successive monthly drop. And it can be seen in the graph below that these drops have impacted on the figure for the whole of 2015.

The graph shows the figures for "Land transport & transport via pipelines, excl. rail transport" and for "Warehousing & support services for transportation" annually for the period 2005 to 2015 inclusive. I didn't cover the storage element of the SPPI (like the CPI but for business costs) in my previous update, but it went down only very, very slightly in 2015 (less than 0.1% against 2014), so if looks as if the drop in income in the warehousing sector of more than 5% last year, must be due to loss of volume rather than changes in rates. And yet that in a situation where publications from the Telegraph through Retail Gazette and including Logistics Manager all reported on high demand for warehousing earlier this month.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - TOPSI - 21 March 2016 - ONS - Warehousing turnover - Logistics Statistics

*The TOPSI figures are from The Monthly Business Survey (MBS) which collects measures of turnover, export turnover, new orders, export new orders on a monthly basis from production industries (UK), and services industries (Great Britain) - transport and warehousing are both in the latter grouping. Figures are collected from a sample of approx 30K businesses at current prices and industry estimates are calculated by extrapolation of the sample results.

26 February 2016: Restrained freight

Earlier this week the ONS (Office for National Statistics) released the latest SPPI* figures, including for the full year 2015. On the graph below I've included a variety of freight and passenger transport indices. The ONS has recently rebased these figures to 2010, so all indices = 100 for that year. But the annual figures published this week don't include 2011 (so the lines on the graph go straight to the value for 2012).

The sudden increase in one year for commercial vehicle ferries was EU legislation, which forced operators of ships in the English Channel, North Sea and Baltic Sea to adopt more expensive low-sulphur fuel. And freight forwarding is doing it's usual thing - here's an explanation of the reasoning behind its counter-cyclical movement. But what the graph really shows is the restrained increases in freight (road and rail) when compared with passenger fares (air and rail) - prices for airfares being put down to capacity constraints, and unregulated rail fares not controlled by inflation-related increases.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - inflation - 26 February 2016 - ONS - SPPI - Road freight - transport - Logistics Statistics

*The Service Producers Price Index is a bit like the CPI - it shows the increase in prices and rates paid, but for services provided by businesses to other businesses and government.

27 January 2016: Tax burden continues to rise

Last week, the Office for National Statistics published the latest inflation figures. They also published data for the TPI* for the whole of 2015 - the TPI is the Tax and Price Index. Investopedia defines TPI as: A measure of the percentage that a consumer's income would have to adjust by in order to maintain the same level of purchasing power. The tax and price index (TPI) takes into account changes in retail prices due to inflation, as well as changes to direct taxes that reduce a consumer's disposable income.

The graph below shows how the TPI has changed compared with the CPI over the past ten years - despite the CPI being stable across 2015, the tax burden has meant that the consumer has continued to get worse off. The impact of the VAT changes in 2008 to 2011 can be seen clearly - VAT was reduced from 17.5% to 15% from December 2008, returned to 17.5% in January 2010 and then increased to 20% from January 2011.

Aricia Update Graph - TPI & CPI - Taxes and price inflation - ONS - 27 January 2016 - inflation statistics

*The TPI is NOT defined as a national statistic. 'National Statistics' are a subset of official statistics which have been certified by the UK Statistics Authority as compliant with its Code of Practice for Official Statistics. So it needs to treated with a little more caution than those statistics that are formally counted as 'National Statistics'.

Thanks to this website for the excellent 10 pic: http://www.worldbanknotescoins.com/.

12 January 2016: There is no driver shortage

I'm going to contradict what I've only recently put in writing, so let me explain: my conclusion is that most people who have gone to some cost, time and effort to get qualified as HGV drivers do not use those qualifications. While I continue to be very concerned about the driver age profile, I now disagree with some of my previous conclusions, including that driver numbers have become a national issue. In part, I fell into a trap of believing that what some parties in our industry were saying. I'm now back where I started, believing that our industry needs to stop moaning and put its money where its mouth is.

Here is a link to the full version of this driver numbers analysis.

I said before that this was about attracting fresh blood, but it appears that this is not the case. There are 80K drivers in the age band 25-44 who are ready to go - they have an LGV licence and they have a DQC, they just don't choose to use them - they're keeping their hand in "just in case". And there are another 90K in the 25-34 age bracket with LGV entitlement and with apparently no need to do much more than a week's training (without a test) to get a DQC.

This is about re-inspiring people who took their licences and couldn't hack the job for whatever reason. If it were just one or two people, then you could put it down to their own unrealistic expectations, but it looks like there's tens, even hundreds, of thousands - our industry isn't just less attractive to younger people, it's not that attractive to any age group. So how do we get some of those qualified people to come and drive a truck?

Although there's not much we can do about the legislative burden that drivers have to shoulder these days, there are things that our industry can do for itself. As I've said before, it involves looking after drivers - giving them self-respect by paying them an attractive rate for sensible hours, and providing some decent facilities at DCs and out on the road. We need to ask ourselves how many older drivers would come into the industry today, particularly as agency drivers. Increased wages and training need to be built into increased operating costs and charges for transport need to go up.

So how and why have I changed my mind? In the January 2016 edition of Focus, the Chartered Institute of Logistics & Transport journal, I said that I'd asked DVLA for the data for all C and C+E drivers with DQCs in five-year age bands. And I'm very grateful for another prompt and helpful response. I was sceptical about the DVLA LGV entitlement figures to start with, to the extent that I didn't put them in my latest Focus article. But with the DQC figures, which DVLA provided just before Christmas, and answers to my questions at the start of the new year, I now have a picture which uses all the available data and seems to me to make sense. I've combined these various sources of data into the graph below.

Aricia Update Graph - inflation - 12 January 2016 - ONS - DVLA - LGV - HGV - DQC - driver shortage - Logistics Statistics

I have returned to believing that the solution is in our industry's own hands. Logistics needs to become the industry of choice. And its custodians need to recognise the real issues - many of our industry leaders are in denial.

Here is a link to the full version of this driver numbers analysis.

If you'd like a speaker on the topic of driver numbers and age profiles, do get in touch: Kirsten Tisdale, 01295 758875, kirsten@aricia.ltd.uk.

16 December 2015: 'Tis the Season to be Jolly

And therefore the season to buy seasonal fare. We buy 'seasonal' fare throughout the year, by definition. But as we approach the Christmas period this country goes mad, suddenly buying so much more food than usual that our local council is currently running radio ads encouraging people not to over-buy and waste, or at least manage to get the correct recycling bin when they do so!

So while we buy seasonal food all year round, the price of that seasonal food suddenly becomes much more of an issue for many at this time of year, particularly when entertaining large numbers of friends and family.

What the graph below shows is the price index for seasonal food as part of the Consumer Price Index figures, including the latest figures released by the ONS (Office for National Statistics) yesterday. It's shown for November to November for each of the years shown so you can see the change in prices over each year. The lightest line is for November 2010 through to November 2011 and the darkest for the year ending last month. I labelled each line instead of providing a key to make identifying each data set a little easier.

The index base is 2005, so prices in 2005 are represented by 100 - off the bottom of the graph. I have included each set of figures as released in December of each year. There are sometimes minor readjustments subsequently - so, for example, November 2012 was revised down between the two sets of figures being released.

Although we won't know December's price inflation until after it's happened, price index for seasonal food in November this year was 6% above five years ago, where prices in general have increased by 11% over the same period.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - inflation - 16 December 2015 - ONS - CPI - Seasonal food - Retail Statistics

PS Thanks to the Daily Telegraph website for the wonderful turkey picture - visit the site which includes a link to some advice on how to stop your turkey being part of that food waste mountain this year.

27 November 2015: The Freight-Knicker Index

The most recent update I did on the CPI put me in mind of a thought I had a long time ago, when I was commissioned by CILT's Membership & Marketing Committee to work on the CILT from the CILT (Cost Indices for Logistics and Transport from the Chartered Institute of Logistics & Transport). Namely, the Freight-Knicker index - an index which shows how the freight element of a pair of knickers varies over time, and similarly the Freight-Korma index.

The biggest hurdle was, and remains, sourcing the price of knickers and korma quarterly in arrears over a number of years, and so what I present you with today aren't the true Freight-Knicker and Korma indices, but are based on the clothing and food elements of the CPI, along with the road freight element of the SPPI* - the latter released by the ONS (Office for National Statistics) earlier this week. I've rebased both set of indices back to five years ago and then done a simple comparison. I've displayed only the Q3 figures for each year (the most up-to-date figures for the SPPI which is a quarterly index), because of the general seasonality of clothing which wouldn't be displayed by underwear.

As expected, the two indices show quite different paths on the graph below - currently it's the Freight-Korma which is the more interesting, and presenting food logistics providers with challenge.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - inflation - 27 November 2015 - ONS - SPPI - Road freight - SPPI - transport - CPI - clothing - food - REtail and Logistics Statistics

*The Service Producers Price Index is a bit like the CPI - it shows the increase in prices and rates paid, but for services provided by businesses to other businesses and government.

16 November 2015: A handle on driver age profile for the first time?

Over the past month or so, I've published a couple of pieces on the driver shortage and age profile of HGV drivers - one in the Chartered Institute of Logistics & Transport's Focus magazine, and the other as an update on our own website and as a Linkedin post. The more I've researched it, the more interested I've become in the paucity of statistics around this issue. Previously published figures didn't reveal what was happening between the ages of 35 and 64 - it could even have been interpreted as being pretty flat if you didn't know the industry. And these are the figures decision makers see and use.

So I made a special request for data from the Office for National Statistics which was published earlier today - I'm very grateful for the prompt response! This data is in five year age bands (apart from the very youngest and oldest drivers), and to my knowledge is the first time that these figures have been published at this level of granularity. You can see some of this data included in the graph (update continues below graph).

Aricia Update Graph - HGV Driver Numbers - by age band - 16 November 2015 - ONS - Logistics Statistics

What are the headlines from the graph and other fresh statistics?

  • There were less HGV drivers employed July to September 2015 than in the previous quarter and against the same period last year - interesting
  • The profile is anything but flat between 35 and 64 - we all knew it wasn't, but now everyone can see that is the case
  • Over the past year, the age band with the largest number of drivers stopped being 45-49 and moved to 50-54 - drivers are getting older
  • The number of over 65s continues to increase - drivers are getting even older
  • But the real headline is that we can see the age profile properly for the first time

Where does this information come from? It comes from the Labour Force Survey, and I quote: The primary purpose of the Labour Force Survey (LFS) is "providing good quality point in time and change estimates for various labour market outputs and related topics". The labour market covers all aspects of people's work, including the education and training needed to equip them for work, the jobs themselves, job-search for those out of work, and income from work and benefits.

How do they establish how many HGV drivers there are? The sorts of questions asked in the surveys to establish what work people do include "What was your (main) job (in the week ending Sunday the [date])?", "What did you mainly do in your job?" and "What did the firm/organisation you worked for mainly make or do (at the place where you worked)?". The surveys also ask about work-related and vocational qualifications such as HGV and forklift licences.

Now a survey is a survey. ONS will have designed the sample to give statistically significant results - indeed some of the supporting documentation describing how they go about this runs to over 100 pages a piece. With the sample consisting of about 100,000 individuals per quarter, large goods vehicle drivers representing about 1% of the workforce and then broken into 10 age bands, it doesn't take a mathematician to see that there is room for the figures to have some 'flexibility'. But overall they contribute to the same storyline.

What it would be good to see now is data about ALL large goods vehicle drivers - the DVLA DQC data that was published by the FTA earlier this year, split by narrower age-bands. At the same time that I asked the ONS (who it has to be said are set up to provide statistics, by definition) for enhanced data, I also asked DLVA ...early days, but I've yet to have a reply to my email.

You can access the data and read about how to interpret it.

And you can read my other recent pieces on the driver shortage and age profile stats here: Focus article (see top link) and in the update below.

And here's some Linkedin conversation following the update above:

Linkedin conversation - Jonathan Rose - Charles Cawley

29 October 2015: National Lorry Week - #LoveTheLorry

The RHA needs to be congratulated on the initiative that is National Lorry Week and the #LoveTheLorry / #HGVHeroes campaign. And its members need to be thanked for rising to the occasion and putting on imaginative events around the country, demonstrating to the public that the industry takes pride in its task of delivering the daily miracle that is logistics. It's inspiring, and we all need to hope that it will attract new drivers. No-one should be in any doubt that the industry desperately needs them, with younger HGV drivers coming on-stream at less than a third of the rate required to replace older ones.

RHA members as a group were hit hard by the drop of business in the recession, with tonnage carried by mainly public carriers dropping by more than a third over two years. Own account operators kept their business in house and had a much more stable workload, with tonne-km even going up over those same two years. Unfortunately the latest DfT figures in this area are for 2013, so it's not possible for me to say where things are today, but no doubt those same RHA members will be expecting and wanting to take up increased business but with a limited key resource, namely HGV drivers.

What is available for June 2015, is the licensing figures, which show that there are 7% less HGVs than in 2007, although those vehicles have been getting heavier - in 2000 around 26% of artics were over 40 tonnes, whereas by 2013 this had risen to 77%. And HGV mileage has been reducing - by 2013 over 10% less than in 2000. I know that some believe the reduction in HGV miles is a good thing, potentially demonstrating efficiencies in our industry, but I don't think that view can be supported - in the same period, light van traffic rose by over 30%. Now, the nature of the jobs some of those vans carry out, like delivering to homes and restricted town centres, cannot be undertaken by bigger vehicles, but we need to avoid the situation where vans are being used as a substitute for proper trucks because they don't require an HGV driver.

Now some may regard my next point as history, but I'm going to raise it as I believe its ghost is still haunting us. The removal of the 12.5 hour spreadover back in 1986 facilitated, at best, laxness to creep in when scheduling drivers - agency drivers waiting for work, spending an eight hour day in the works canteen before being given five drops in central London. At worst it allowed managers to contemplate scheduling workers' lives in a way where day drivers could morph into night drivers. And when the Mobile Workers Directive came in, Periods of Availability allowed that laxness to continue. However, hauliers now rely on this flexibility to get the job done. And therein lies the rub.

Commentators who say that people know about the conditions and long hours when they come into the industry are missing the point. One has to ask how many older drivers would come into the industry today, particularly as agency drivers. It's not about those already in the industry, they are putting up with it - this is about attracting fresh blood, and fast.

So congratulations and thanks to the RHA and its members - I want to be able to carry on buying food and all the other stuff, and I'm grateful to everyone who gets it there!

There is no graph or map with this update, but if this subject interests you, there's a link on our Presentations & Articles page to an article on the driver shortage in CILT's November 2015 Focus.

And here's some Linkedin conversation following the update above:

Linkedin conversation - RHA - Steve Bowles - Alan White

18 October 2015: If only I had a crystal ball!

The ONS (Office for National Statistics) released the latest CPI figures last week, with the headline news being that UK inflation had turned negative again, albeit only very slightly at -0.1% in September. The small negative was attributed mainly to a smaller than usual rise in clothing prices and falling motor fuel prices.

When I started these updates just over five years ago, it was because there were different pressures on different parts of the retail logistics industry because of the very different inflation rates in clothing and food, and you can see that on the graph I've inset in the bottom left hand corner - the colour key and scales are the same as the main graph. You can see this update in our archives - go right to the bottom of the page.

I included the index for Fuel for running your car in the main graph (orange line), since that was a major contributor to the current negative inflation rate and is something that we've all been aware of at the pumps.

You can see from the main graph that the overall movement in the CPI for the past five years has been less than the previous five. Food prices have been declining since February 2014 - a bit of a shock to an industry more used to inflation. Clothing prices have always been seasonal, in line with the product itself, although I'd have probably described the increase as "less than the past few years", rather than less than "usual".

I guess the big question as always, for us as individuals and as business people, is where will fuel go next? If only I had a crystal ball!

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - Inflation - CPI - Clothing - Food - Fuel - 18 October 2015 - ONS - Retail Statistics

2 September 2015: Five year celebration!

Last week the ONS (Office for National Statistics) published the latest SSPI* figures. And for five years now, Aricia has been publishing these updates which aim to bring relevant government and industry statistics to life.

So, in the graph below, rather than selecting just a couple of indices and tracking their changes, I've included a much wider selection of indices that are likely to be of interest to business people working in logistics and transport, and shown the overall change in prices as a percentage over the past five years, with the top level Gross / GSO* index shown in a contrasting colour, unsurprisingly in the middle of the spread of values.

This selection does include the top rise in prices, business airfares, which perhaps surprisingly continue to rise in price. And it also includes the biggest reduction in prices over the past five years, recycling, or sorted materials recovery services and secondary raw materials as it's known.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - inflation - 2 September 2015 - ONS - SPPI - Road freight - SPPI - transport - Logistics Statistics

*The Service Producers Price Index is a bit like the CPI, it shows the increase in prices and rates paid, but for services provided by businesses to other businesses and government - the top level Gross / GSO index as shown on the graph includes the provision of a number of different services to other service businesses as well as to non-service businesses and government departments. It is a quarterly index, so the most recent figures are for Q2.

30 July 2015: Time to look outside?

Earlier this month Croner published this year's Distribution & Transport Rewards - always an excellent source of information.

One's immediate reaction is to be a little bit surprised that, with all the talk of the driver shortage, median average earnings for a Class C+E driver have taken a bit (4%) of a dip in the latest survey and median basic pay is continues to be down against 2013. Now, any survey depends on who participates, and it could be that a high paying company has dropped out. But now we're in the new normal following the recession, it's as important to understand what wages can buy, and where they're pitched, as what they are per se. To what extent does all the hard work of getting and maintaining a class 1 licence pay for itself?

The graph below shows Class C+E basic pay and average earnings over the past 10 years as a percentage of corresponding light vehicle driver wage levels. Back in 2005, following the first wave of eastern Europeans arriving in 2004, an artic driver could expect a 20% premium for having his (or her) licence. Despite the ups and downs, that premium has now risen to 40% or more depending on whether it's basic or earnings that you're looking at. So why isn't that attracting younger people as professional drivers, while the number of vans continues to grow? Continued below graph...

To make this chart BIGGER, please click on the chart itself and then expand new window.

Aricia Update Graph - Driver pay - class C+E - HGV - LGV - vans - Croner - 30 July 2015 - logistics statistics

Now, the van drivers' wages may well be pulled down by part-time working, although using the median is likely to have removed this as a factor, but it raises the issue of flexibility. Back in 2004 I wrote a Viewpoint for Motor Transport, very little of which is out of date. Perhaps it's time to repeat the research referred to in my article, which is still available: SfL Scotland Survey 2003 - the comments from former drivers are important, particularly as this group were still sufficiently interested in LGVs and the road haulage industry to have attended Truckfest, where this element of research was carried out.

In the recent CILT survey on the driver shortage, question 27 asked: What factors do you think are responsible for the driver shortage? I'm guessing that this has been completed by managers, but there's no real point in interviewing current drivers - two reasons: they've stuck with it and many of them don't represent the future workforce.

Perhaps there's a need to research outside our own industry and find out what people like about their jobs and explore whether those factors can be replicated for truck drivers.

22 July 2015: Freight Rate Seesaw

With the news earlier this week that supermarket diesel was cheaper than petrol, I thought it was time to have a quick look at how freight rates to and from Europe compared with a year ago, when I put together a slide pack on European transport costs, which you can find in CILT's Knowledge Centre.

In the meantime, not only has the price of diesel gone down by some 16% (104.92 on 17 July a year ago compared with 88.08ppl at the start of this week), but the exchange rates have also meant that you now get about 13% more Euros than you did a year ago (1.27 on 22 July 2014 compared with 1.44 Euros to the earlier this week).

The data in the chart below comes from Freightex, and shows that while trips to this country from mainland Europe are the same or more expensive than they were a year ago (priced in Euros), it appears that foreign hauliers must be desperate to get home, with rates the same or cheaper.

Aricia Update Graph - Freight rates - to and from Europe - 22 July 2015 - Freightex - Logistics Statistics

4 July 2015: Saving or Spending?

There were all sorts of statistics out this week. On 30 June GfK reported post-election 'bounce' as consumer confidence increased 6 points.

And out on 1 July was an ONS release with the exciting description: "National Accounts articles, The Saving Ratio: How is it affected by Households' and Non-Profit Institutions Serving Households' income and expenditure?"

The graph below shows both the saving ratio and the net acquisition of loans - and, yes, the latter does go into negative territory on a couple of occasions. In summary, people are back to saving at pre-recession levels (having saved more while things felt less good), but haven't yet been tempted to take out loans at pre-recession levels (it doesn't feel that good!).

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - saving spending - 4 July 2015 - ONS - Savings Ratio - Net new loans - Consumer confidence - high street - Retail Statistics

The ONS article ends with the conclusion: "...In more recent periods, the falling saving ratio appears to have been driven by slower increases in income from wages and salaries - rather than large increases in consumption..." And the ONS wonders what might happen next: "...If wages continue to rise more quickly, it will be interesting to see whether households consume more (which will further reduce the saving ratio) or save more, which will increase it."

On 2 July BDO seemed to answer that question, reporting the worst June on the high street for nearly a decade, although apparently we have been spending more on eating out and holidays ...so assuming you're one of the crowd, here's some thoughts from 2014 on building the perfect sandcastle - it's the website I need to credit for the sandcastle pic behind the graph!

10 June 2015: Paddy Power - 3/10 on staying in

To see the source of this graphic, please click on the graphic itself.

Aricia Update Graph - European Referendum - 10 June 2015 - Paddy Power - YouGov - Political Statistics

With the vote following the first debate on the UK's membership of the European Union at 544 to 53 in favour of having a referendum, it's definitely time to start assessing what might be the impact of departure, if it happens. And so where better to start than in assessing how likely it is that the UK will leave the union?

In a commentary piece on YouGov yesterday, Stephan Shakespeare said "In our new poll 'Yes' leads ...but look beyond the headline figures and 'No' voters are more likely to vote".

Right now Paddy Power have the following odds:
In favour of remaining in EU - 3/10
In favour of exiting EU - 21/10

What that means is that there is something like a 77% chance of remaining = 10/(3+10), and a 32% chance of exit - some will have noticed that this adds up to more than 100%, but that's betting for you.

Now most (all?) of the pollsters got it dramatically wrong in the lead up to the election and many are still crying into their surveys and, as the Huffington Post reported, "...at 7pm the night before the election, Paddy Power's best odds was that there would be a Labour minority government."

Who do you think is most likely to call this one correctly? And what are you doing to prepare for departure if it happens?

And here's some Linkedin conversation (screen capture on 2 July) following that update:

Linkedin conversation - 10 June 2015 - Ray Fowler - Dan Hawker - Mike Vernon

28 May 2015: Cycle stability?

Yesterday the ONS (Office for National Statistics) released the latest SPPI* figures. In the graph below, I've included the index for Freight Transport by Road (bright pink line) and also the overall index (dark blue) at Gross level (see the footnote under the graph). It was the Road Freight index along with some of the other transport indices that first drew my attention to the SPPI, thanks to the Knowledge Centre at CILT, and I'm always interested to see how that is moving in comparison to general business costs.

But I've also included indices for three categories of business expenditure which have somehow returned to the same sorts of prices as five years ago, after following anything but the same path: Freight Forwarding (yellow line), Property Rentals (lighter blue) and Contract Packing (green).

Now the SPPI is not seasonally adjusted, but it can be seen from the graph that these movements that this volatility is not down to seasonality. Property Rentals seem to have been picking up from mid-2013, although please note that the Property Rentals figure is for businesses generally, it is not logistics specific. Contract packing was remarkably stable for most of that same period until the drop in Q1 this year. And given that Freight Forwarding is said to be counter-cyclical due to the business structure, it at least looks as if the cycle has been more stable than at the beginning of the five years of coalition.

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - inflation - 27 May 2015 - ONS - SPPI - Road freight - SPPI - transport - Logistics Statistics

*The Service Producers Price Index is a bit like the CPI, it shows the increase in prices and rates paid, but for services provided by businesses to other businesses and government - the top level Gross / GSO index as shown on the graph includes the provision of a number of different services to other service businesses as well as to non-service businesses and government departments. It is a quarterly index, so the most recent figures are for Q1.

22 May 2015: Food plods along

Earlier today the ONS (office for National Statistics) released the Retail Sales figures which showing how retail performed in April. My attention was drawn to retail volumes (as opposed to values) when I was doing some sales benchmarking for client earlier this month. I often rebase retail and logistics statistics to make graphs start an index of 100, but in this case I've left the figures exactly as published, with 2011 as the base year, as my point is well-illustrated by this.

What the graph below shows is the extent to which the volume of non-food purchases was increasing before the recession and has picked up again post-recession, while food plods along. No wonder the erosion of supermarket sales by the so-called "discounters" is so damaging to existing players.

To make this chart BIGGER, please click on the chart itself and then expand new window.

Aricia Update Graph - Retail sales - volume - food - non-food - ONS - 22 May 2015 - retail statistics

And here's some Linkedin conversation following that update:

Linkedin conversation - 27 May 2015 - Lynn Parnell - Noel Blake - Food Volumes - Retail Statistics

24 April 2015: Amazing Amazon!

In the UK a one-hour home delivery means that your order will arrive in a one-hour time window, but in parts of the US it means it will arrive within the hour. Now Amazon doesn't need me to do its advertising, but credit where credit's due - as witnessed by this test of their service by the Statesman last week. And I'm really grateful to Dan Boaz of Airfreight.com for his update on Linkedin that drew my attention to the test.

For anyone who doubts that groceries is where Amazon should be, one look at the graph below shows you all you need to know: the comparatively low market penetration of online in food (red) and its high year-on-year growth (blue) when compared with non-food which includes department stores, clothing and footwear, furniture, electricals, audio/video equipment and recordings - the graph is for Britain and doesn't include non-store retailing. The data for the graph is from figures in the Retail Sales report released by the ONS (Office for National Statistics) yesterday.

This is why all the industrial property companies are predicting the growth in small edge-of-urban fulfilment centres ...and if you're in logistics and you don't think that is where life is going, just read MWPVL's research on the properties that Amazon have in the UK - it's the last entry in the UK listing that makes you sit up, about two thirds down the page.

With all of us now doing convenience shopping for tonight's dinner, home deliveries of fmcg/dry/ambient groceries look like the future ...and delivered before you've even switched off the cooker and sat down to eat.

To make this chart BIGGER, please click on the chart itself and then expand new window.

Aricia Update Graph - Internet sales - food - non-food - Amazon - urban fulfilment centre - 24 April 2015 - ecommerce and logistics statistics

And here's some Linkedin responses following that update:

Linkedin conversation - 27 May 2015 - Paul Skrgatic - Zen Yaworsky - Richard Fernley - Amazon Profit Loss - eCommerce Statistics

13 April 2015: Pity those in truck manufacturing and sales!

Last week the Department for Transport released the latest new registration figures for different vehicle types and today the BBC was carrying a news item from the SMMT, the Society of Motor Manufacturers & Traders, on how online shopping was boosting van sales.

Because these new registration figures are always very variable month to month, the graph below shows a moving average which smoothes out normal seasonality. The moving average used is based on the twelve months ending with the data point on the graph - so the point for February 2015 is an average for the twelve months ending February 2015 and so on. The scales on the two different axes are quite different, with more than 8 times as many light goods vehicles as heavy registered in 2014.

It's a couple of years since we've looked at these figures, but what the graph demonstrates is not only the rising van sales that have made today's headlines, but also the continued erratic impact of Euro emissions legislation on the purchase of heavy goods vehicles (see also updates in the updates archive dated 17 March 2013 and 15 March 2011).

To make this chart BIGGER, please click on the chart itself and then expand new window.

Aricia Update Graph - Department for Transport - DfT - new vehicle registrations - 13 April 2015 - transport and logistics statistics

1 April 2015: The link between business and crime

The annual statistics for crime figures run from April to March, and so yesterday represents the end of the most recent period 2014/15. Although the figures won't be available until later in the year, there is already cautious optimism that this will be the last time that they will need to be published.

What you're seeing in the graph on the left below is the number of businesses in the years 2002-14 (maroon line) and the total number of crimes for 2002/3-2013/14 (dark blue line)*. Anyone looking at this graph can see that there is inverse correlation, although the relationship between business and crime is far from straightforward. So the graph on the right plots the two sets of data as a scatter graph (large purple spots) with a trend line (the purple dotted line). Although a linear trend would give a good result with R-squared=0.95**, this second graph shows a polynomial trend line and its R-sq, which at over 0.98 indicates extremely close correlation. And because the number of businesses is already known for 2014, we're able to forecast the number of crimes for 2014/15, which looks to be in negative territory.

Kirsten Tisdale, MD of leading consulting company Aricia Limited, said: "It's unbelievably good news for the government - collating these figures this year is almost a formality, as it looks as if ex-criminals will either be running businesses or even doing good. Businesses and charities need to be ready for this opportunity, harnessing the undoubted innovation skills that many criminals naturally possess, as illustrated by this BBC report".

To make this graph BIGGER, please click on the graph itself and then expand new window.

Aricia Update Graph - business - crime - forecast - department for business, innovation & skills - home office - Business Statistics

*Both sets of data are from the government's own website - follow these links to learn more about the number of businesses from the Department for Business, Innovation & Skills and to find crime data from the Home Office.

**R-sq=0 means no correlation at all, R-sq=1 is a perfect match.

If you'd like to see older updates on a wide variety of subjects, please visit this link for archive updates.