Economists cited supply chain bottlenecks such as the cargo situation as a reason that prices have been increasing so fast lately and that consumers bought less stuff in December, according to Friday’s report on retail sales from the government. After all, it’s hard to buy something if it’s stuck in the middle of the Pacific. It was only in November that the port complex, which consists of the ports of Los Angeles and Long Beach, started incentivizing ships to slow their voyages instead of anchoring near the port. And only in December did the marine exchange begin including those slow ships in its daily count of backed-up vessels. That caused something of a hiccup for economists, who had previously measured the backup by counting only those ships in or near the port complex. For example, Oxford Economics’ recently released supply chain stress tracker—an indicator of production and transportation backups in the economy—showed an improvement at the port complex in December. But it turned out to be an illusion because of how it was counting the backed-up ships. “On the surface, it looks like the supply chain has gotten a little better,” said Oren Klachkin, lead U.S. economist at Oxford, noting that the real ship backup was much worse than its tracker suggested. “The total number waiting off port, not just 40 miles, is still high. Until that changes, the backlog will continue to get worse, overall." Have a question, comment, or story to share? You can reach Diccon at dhyatt@thebalance.com.
