Be On The Lookout
That is the watch word for motor carriers as they are trying to find drivers to fill their cabs and avoid having to park their equipment or turn down loads. The reason: they can’t find enough drivers. The U.S. driver shortage is expected to more than double over the next decade as the industry struggles to replace aging baby boomer drivers. The driver deficit swelled by more than 10,000 to 60,800 in 2018 from just a year earlier, according to a study by the American Trucking Association.
To meet the nation's freight demands, the industry will need to hire 1.1 million new truck drivers over the next decade, an average of 110,000 per year, to replace retiring drivers and keep up with growth in the economy. According to the Bureau of Labor Statistics, truck drivers average $43,680 a year, with the top drivers making over $65,260 and the bottom 10% making less than $28,160. Pay would need to jump by 40% to 50% to attract a significant number of new drivers.
Some carriers are using sign-on bonuses that can be as high as $6,000 to attract new drivers to the field. While attracting new drivers has been a challenge, retaining new drivers has been as much of a challenge. Turnover rates among new drivers can range from 45% to 85%. According to data from the National Transportation Institute 85% of 519 surveyed trucking companies said that increasing wages and bonuses hasn't materially helped attract new drivers.
Part of the problem is other industries, particularly construction and energy, are attracting the sort of blue-collar workers who would normally go into truck driving. Those jobs have better pay without the challenges of driving, and employees are not away from home for two to three weeks at a time. There is also competition from the gig economy. These are jobs such as with Lyft and Uber where workers set their own schedules, work part-time and can still make $50,000 per year.
There is also strong competition from private fleets. The median W2 wage for a private fleet driver is $20,000 higher than for-hire, allowing them to hire the best drivers. These jobs offer drivers better scheduling, as a result turnover at private fleets is only around 9 percent, with most of that coming from retirements.
To help put more drivers behind the wheel, some carriers are focusing a portion of their recruiting efforts on women. Generally speaking, female drivers have a better safety record and are very attentive and focused when behind the wheel. But today women make up just 6% of the nation’s truck drivers. There is also the opportunity that the Drive Safe Act will allow commercial drivers under the age of 21 to drive across state lines. This would open up interstate trucking jobs to young drivers.
The bottom line is this: there is no magic bullet that will solve the driver shortage. The widespread adoption of autonomous vehicles will help but it cannot come soon enough. Shippers should be prepared to continue to see increased freight rates, driven in part by the driver shortage for the foreseeable future.
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