In a stark reminder of the rate pressures and sub-par growth besetting shippers for the past year, a leading index of shipping activity reported Thursday that freight costs in 2011 jumped 18.8 percent over 2010 levels, while volumes rose a scant 0.7 percent over the same period.

The index, compiled by freight auditing and payment firm Cass Information Systems Inc., measures shipments and expenditures of hundreds of Cass's clients, who collectively spend about $17 billion on transportation services annually. The survey showed a 12-percent fourth-quarter volume decline from the prior quarter, a larger drop than is expected on a seasonal basis. But from November to December alone, expenditures rose by 1.8 percent.

Domestic shippers had few places to hide from rate increases in 2011. Railroads, emboldened by solid demand for carload and intermodal services, raised rates by as much as 15 percent throughout the year. Truck rates rose as well, but not nearly as much as rail rates, the report said. Truck rate increases were driven less by increased demand than by carrier efforts to recoup higher costs for everything from labor to rigs to diesel fuel.

"Continued cost pressures from labor, fuel, and regulations are consuming most of the increased revenues in the trucking industry, leaving little for new capital investments in equipment," according to the report. Truck rates will continue to rise in 2012 as rig capacity is expected to remain tight, the report said.

Roslyn Wilson, author of the report, said that while the year-over-year increases in expenditures are not unprecedented, the gap between the pace of increases in expenditures and volumes could be. The disparity "is explainable by the rate increases that the carriers have been able to sustain even as volume has tapered off," she said.