For-hire Motor Carrier Freight Services Price Index (FHMCFSPI)

Detailed information for fourth quarter 2020

The purpose of this survey is to collect and compile data to measure the monthly change in the movement of the price for for-hire motor carrier freight services. These prices are combined and chained to form a price index. The estimates are produced on a quarterly basis.

Data release - March 30, 2021

• Questionnaire(s) and reporting guide(s)
• Description
• Data sources and methodology
• Data accuracy

Description

The for-hire motor carrier freight industry is a vital part of the Canadian economy and the services that the businesses provide is crucial for an effective and efficient flow of goods. The For-hire Motor Carrier Freight Services Price Report survey collects prices of service/shipment transactions which are essential to the creation of a price index for this sector. The index measures the movement of prices for the services that are provided by the trucking industry.

The For-hire Motor Carrier Freight Services Price Index (FHMCFSPI) can be used by businesses to measure their performance against industry standards, to plan marketing strategies or to prepare business plans for investors. Governments use index data to develop national and regional economic policies and to develop programs to promote domestic and international competitiveness. The data are also used by trade associations, business analysts and investors to study the economic performance and characteristics of the industry.

The index data provides a better deflator for Statistic Canada's System of National Accounts for this sector of the economy.

Statistical activity

These indexes are a part of the Services Producer Price Index program (SPPI) at Statistics Canada.

The SPPI program develops and produces price indexes for a wide range of business service categories. This initiative fills an important data gap in the area of economic statistics and has resulted in a more comprehensive set of service price indexes. It also allows Statistics Canada to produce more accurate estimates of real value added of the Gross Domestic Product and changes in productivity.

Reference period: The time period for which the For-hire Motor Carrier Freight Services Price Index equals 100; currently this is the year 2013.

Collection period: Collection begins the last week of the quarter and continues until the end of the second month of the following quarter.

Subjects

• Prices and price indexes
• Service price indexes
• Transportation
• Transportation by road

Data sources and methodology

Target population

The target population for this survey is all establishments in the trucking industry that are classified under the code 484 - Truck Transportation, according to the North American Industry Classification System, generating more than $1,000,000 annual revenue.

It is expected that the establishments with less revenue are owner-operators and their revenue is counted within the larger enterprises as they are contracted to do hauling by the larger enterprises.

• Additional documentation

Instrument design

The For-hire Motor Carrier Freight Services Price Report questionnaire was developed at Statistics Canada and was reviewed and tested in the field in both official languages by the Questionnaire Design Resource Centre. In the course of developing the questionnaire, Statistics Canada consulted with a number of large carrier companies.

Respondents are asked to report for services and prices which they consider to be typical and representative of their business and that they can price each cycle.

Respondents are requested to provide estimates in cases where they did not have the specific shipment for the selected month.

When the services specified are no longer being provided or representative, new specifications are obtained from the respondent.

The electronic questionnaire was introduced in Q1 2015.

Sampling

This is a sample survey with a longitudinal design.

The frame is part of Statistics Canada's Business Register classified to the truck transportation sector (code 484 - Truck Transportation, according to the North American Industry Classification System).

Sampling unit
The sampling unit is the establishment. The establishment, as a statistical unit, is defined as the most homogeneous unit of production for which the business maintains accounting records from which it is possible to assemble all the data elements required to compile the full structure of the gross value of production (total sales or shipments, and inventories), the cost of materials and services, and labour and capital used in production.

Stratification method
The units on the frame are stratified by 5-digit North American Industry Classification System (NAICS) code (48411 - General freight trucking, local, 48412 - General freight trucking, long distance, 48421 - Used household and office goods moving, 48422 - Specialized freight (except used goods) trucking, local, 48423 - Specialized freight (except used goods) trucking, long distance).

The sample consists of trucking businesses which were selected based on establishment revenue and stratified by 5-digit NAICS code.

Each NAICS stratum was further stratified by take-all (large units) and take-some (smaller units).

The largest establishments were selected into the sample with a probability of 100% "take-all" method. The remaining establishments were selected according to the "take-some" method, where the probability of selection was the revenue of the establishment for the reference year.

Sampling and subsampling
The population is stratified by 5-digit NAICS and by size based on revenue. The sample is allocated to strata by revenue and selected based on probability proportional to size using sequential Poisson sampling.

Data sources

Responding to this survey is mandatory.

Data are collected directly from survey respondents.

Monthly data are collected on a quarterly basis via electronic questionnaire (EQ), while telephone communication (computer-assisted telephone interviewing) is used for non-response and data follow-up. Several follow-up contacts can be made including sending out an email, fax or letter reminder in order to collect data.

An initial telephone interview with the respondent consists of identifying and collecting baseline information which is then returned on subsequent EQ in order to continue to price the same specifications, which form the basis of the price indexes.

When the services specified are no longer being provided or representative, new specifications and pricing are provided by the respondent.

Respondents are asked to provide estimates in cases where they do not have the specific shipment for the selected month.

Information about the time it takes respondents to complete the survey questionnaire is collected and monitored closely. Currently, it takes respondents an average of 23 minutes to complete the survey.

View the Questionnaire(s) and reporting guide(s) .

Error detection

Error detection is conducted at the time of data collection and also during post collection processing, using a set of systematized error detection procedures to identify outliers and possible reporting anomalies. Records that fail these edits are reviewed for editing and correction when necessary or edit failure may trigger a follow-up with the respondent.

Time and effort is devoted to keeping the specifications constant such that only the pure changes in price are tracked. Some information is also collected in order to ensure, as much as possible, that the collected data correspond to the same specifications over time. This constant quality price then feeds into the Canadian System of Macroeconomic Accounts estimates of constant dollar gross domestic product.

Imputation

Missing data are generally estimated by a systematized imputation process. In any given period, price data may not be available. In such cases, missing data are imputed using the average price movement of remaining units within the same stratum (overall mean or targeted mean imputation method).

Estimation

Prices
An initial collection, done by phone, gathers specifications of the service covering, such as their assigned code under the North American Industry Classification System, commodity carried, weight, origin, destination, distance, and type of pricing used (e.g. contract), to serve as a model for pricing in subsequent questionnaires. Monthly price quotes are collected quarterly from respondents by electronic questionnaire. The price is defined as the amount charged by a carrier for delivering a specific freight between selected origin and destination under certain terms.

The price consists of a base price, minus discounts, plus surcharges (fuel and/or other).
Taxes are not included.

Weights
The For-hire Motor Carrier Freight Services Price Index (FHMCFSPI) uses establishment revenues as its weighting source. The establishment revenues are derived from the Business Register.

Indexes
Estimates are produced by calculating a weighted average of price relatives by industry, which are chained together to form an index series. The FHMCFSPI is a Laspeyres chain linked index, available at the Canada level only.

Linking of indexes
With the introduction of a new basket, historical estimates are linked to the new basket by maintaining the same historical monthly changes. This is done by calculating a link factor for each index series as the ratio of the new index series (2013=100) in the overlap period to the old index series (2007 =100). This link factor is applied to the old index series to bring it up or down to the level of the new index.

The overlap period for the FHMCFSPI is currently December 2013.

Quality evaluation

An in-depth assessment of quality is conducted prior to the dissemination of estimates. This assessment is based on two key elements of quality (accuracy and coherence); as defined in Statistics Canada's guidelines for the validation of statistical outputs.

The survey's data collection strategy is designed to ensure that targeted response rates are met every cycle. Analysts pay close attention to this metric and take the appropriate measures to ensure that the survey's coverage is thorough. Particular attention is also given to ensuring that sampled products or services are representative of actual transactions taking place in the market. These two activities, fundamental to the overall quality of the estimates, are done consistently.

Analysts also undertake additional validation activities every cycle to ensure the coherence of survey estimates. These activities include the analysis of price changes period-over-period and the analysis of trends at the business/company, industry, subsector and sector levels, the certification of key contributors to price change as well as the confrontation of estimates against other related data sources. Contextual analysis of survey results is also performed in light of prevailing economic conditions.

Engagements with relevant stakeholders are also undertaken periodically. Forums involving other Statistics Canada analysts, industry stakeholders and partners at other national and international statistical agencies provide valuable insight into the development and research agenda of the program.

Disclosure control

Statistics Canada is prohibited by law from releasing any information it collects which could identify any person, business, or organization, unless consent has been given by the respondent or as permitted by the Statistics Act. Various transformations are applied to collected price data in the calculation of price indexes, such that it is not possible to identify the raw price data obtained from any survey participant. Confidentiality rules are also applied to price indexes that are released or published to prevent the publication or disclosure of any information deemed confidential. If necessary, data are suppressed to prevent direct or residual disclosure of identifiable data.

Revisions and seasonal adjustment

Data for the most recent quarter are preliminary. The previous quarter of the series is subject to revision. The series is also subject to an annual revision released with second quarter data of the following reference year. The indexes are not seasonally adjusted.

Data accuracy

The statistical accuracy of this index depends on price and weight data obtained from sample surveys. Each type of input data is subject to its own errors. Also, sampling errors occur when observations are made only on a sample and not on the entire population.

All other errors that arise from the various survey phases are referred to as non-sampling errors. For example, non-sampling errors can occur when a respondent provides incorrect information or does not answer certain questions; when a unit in the target population is omitted or covered more than once; when an out of scope unit is included by mistake or when errors occur in data processing, such as coding or capture errors.

The survey uses a methodology and processing procedures to control for sampling and non-sampling errors and reduce their effect on estimates. Consequently, the aggregate indices at all levels are considered to be statistically reliable.

Response rate
The survey achieves about a 78% response rate. A systematized imputation process is used to impute for the non-response portion of the sample, achieving an effective 100% coverage. Non-response bias is also minimized during the same process.