The shortage of truck drivers in the United States is driving up pay. However, it does not address the shortage of truck drivers.
During the pandemic, massive increases in online ordering drove up demand for delivery truck drivers. As a result of the increased competition for long-haul truckers, trucking companies have had to raise pay. However, not enough people have been persuaded to take the long-distance driving jobs that the industry requires.
Instead of receiving pay raises, many drivers are hopping from one company to the next.
For truckload carriers, the segment of the industry that transports trailer-size shipments long distances, the average annual driver turnover rate is around 95 percent.
The industry’s most severe driver shortages are affecting truckload carriers.
Drivers appreciate the higher pay, but they’re keeping an eye on what else is available, according to Daniel Walton, a 47-year-old truck driver with Roehl Transport, a Wisconsin-based trucking company with 2,300 employees.
“Everybody loves getting more money,” said Walton. “You hear numbers thrown at you, there is a temptation to go elsewhere.” He recently had one friend go to Walmart (WMT) and another to FedEx (FDX), both of which have more regular routes and allow their drivers more time at home.
Rising pay, ironically, may be exacerbating the shortages it is supposed to alleviate. Many drivers are reducing their driving hours as a result of their higher pay. “More drivers want to be at home. That is something they have said to us “Roehl’s vice president of driver employment, Tim Norlin, stated.
According to Walton, some drivers are taking advantage of the higher pay by reducing their driving time.
“You see guys with young children, they were out there working,” he said. “This affords them the opportunity to be home a little more with their children.”
Walton is on the road about four weeks out of every five, but his family is used to him being gone for long periods after a 22-year career in the merchant marine before becoming a truck driver.
While Walton enjoys life on the road, he recognizes that it is not for everyone. He assists in the training of new drivers at Roehl, and he has had drivers leave due to stress or homesickness shortly after joining.
The segment is known as truckload carriers, which transport trailer-size shipments of freight long distances, has the greatest shortage of truckers. Those companies’ drivers are frequently on the road for weeks at a time, picking up one load after another, driving the maximum number of hours allowed, and sleeping in their trucks when they’re not on the road.
When competing for those drivers, companies like FedEx, UPS, Amazon, and Walmart that can offer more regular routes and time at home have an advantage beyond pay.
Another source of competition for drivers is the burgeoning construction industry, which does not require workers to be on the road.
To keep drivers on their payrolls, trucking companies are increasing pay. Roehl implemented its second pay raise of the year this week, raising driver pay by about $4,000 to $6,000 per year, or about 9% to 11%.
“We have to offer that additional pay to be competitive,” said Norlin.
CR England, another truckload company, announced its third pay raise in the last three years in April, increasing its drivers’ pay by more than 50% over 2018.
When drivers are available, trucking companies charge higher rates to customers and take on more work.
“Our customers have been very understanding that it’s necessary to raise rates,” said Norlin. “I could literally hire 500 to 1,000 more drivers — we have the business offerings from customers to keep them busy.”
Walton claims that his pay has risen from around $40,000 a year a few years ago to around $70,000 this year.
A new federal clearinghouse that alerts carriers to drivers who have failed drug tests, DUIs, or other substance abuse problems on their records is one factor that has reduced the supply of drivers. Since the clearinghouse went into effect in early 2020, 54,000 drivers have been barred from driving.
“We are in favour of the clearinghouse. Those people should not be on the road, “The American Trucking Associations’ chief economist, Bob Costello, stated.
What his group wants is for the federal law prohibiting anyone under the age of 21 from driving a heavy truck to be repealed.
“Why are 18, 19 and 20-year olds able to drive tanks and fly planes in the military and they can’t drive trucks?” he said. The industry is concerned that those graduating from high school will be barred from considering a career as a driver for three years, causing them to look for other work and suffocating the pipeline of potential drivers.
“If we got to them earlier, we might be able to attract more drivers to the job,” he said.
Even so, that change would not be enough to close the gap. “There isn’t a single cause for the driver shortage, so there isn’t a single solution,” Costello explained.