December Logistics Score Hits Record Low During Holiday Season
The Logistics Managers’ Index ended the year with the lowest score since April 2024, fueled by record inventory depletion amid consumer holiday shopping, according to researchers at ʦapp and four other schools.
ended the year with the lowest score since April 2024, fueled by record inventory depletion amid consumer holiday shopping, according to researchers at ʦapp and four other schools.
The LMI score for December 2025 came in at 54.2, down from December 2024’s 57.3. Any score above 50 indicates the industry is expanding; a score below 50 suggests contraction.
Not only is it the lowest score in over a year, but it marks the 10th consecutive month of a score below the all-time average.
Inventory levels plummeted 17.4 points to 35.1, the lowest month-to-month drop on record amid holiday shopping. In response, warehousing utilization dropped to 42.9, while warehousing capacity rose 6.4 points to 61.2.
Transportation utilization increased 6.7 points to 58.2, and transportation prices rose 1.8 points to 66.7, the highest level since January 2025.
“The rapid and historic decrease in inventory levels is likely due to strong holiday sales (as reported by credit card processing companies), coupled with previously high inventory levels,” said , Ph.D., associate professor of supply chain management in ʦapp’s . “At a high level, the strong sales are a good sign; the lingering question is which segment of the consumer market is buying. Recent reporting suggests high earners are driving significant sales, whereas lower earners have stagnated and shifted to necessary spending only.”
The logistics industry often serves as an early indicator of shifts in the broader economy. When supply chains slow down due to port congestion, inventory shortages, or transportation delays, it can signal economic stress before it appears in traditional metrics. The reverse is also true: as the economy recovers, logistics activity tends to rebound first, reflecting renewed demand and movement of goods.
The , a survey of director-level and above supply chain executives, measures the expansion or contraction of the logistics industry using eight unique components: inventory levels, inventory costs, warehousing capacity, warehousing utilization, warehousing prices, transportation capacity, transportation utilization, and transportation prices.
Along with ʦapp, researchers at Arizona State University, Colorado State University, Rutgers University, and the University of Nevada, Reno, calculated the LMI using a diffusion index to offer a dynamic view of the U.S. supply chain, anticipating economic shifts and trends.
Looking ahead to the next 12 months, supply chain respondents predict that inventory levels and inventory costs will mildly expand as retailers rebuild after holiday depletion, as inventory costs are affected by tariffs. Respondents also expect transportation capacity to contract further amid growing demand and driver shortages.
“The shift in the future trend shows a few key points. Upstream partners are planning on holding inventories at higher levels than their downstream counterparts, perhaps acting as a safety stock, whereas downstream is expecting to operate more leanly,” Carnovale said. “It appears that the upstream portion of the supply chain is also planning on significantly tightened transportation capacity, and increased pricing, coupled with increased utilization. These two points are likely to strengthen freight markets, should predictions come to fruition.”
-ʦapp-