Anyone considering a long-term career in commercial truck driving is kindly asked to jump in right away.
According to a high-ranking official at the American Trucking Associations (ATA), drivers are badly needed.
Bob Costello, the organization’s chief economist, tells Leo Rommel of Industry Today that the country’s ongoing truck driver shortage is now in the range of 30,000 to 35,000 on the basis of 750,000 trucks. If current trends continue, the shortage may exploded to as many as 245,000 by 2022, he says.
These troubling figures intensify when you consider that trucking currently halls nearly 70 percent of all freight tonnage in the U.S. That percentage, Costello adds, is likely to increase in the years to come.
For instance, a recent ATA analysis confirms that truckload volumes are projected to increase 3.2 percent through 2018 and 1.1 percent annually between 2019 and 2024. Less-than-truckload volume, meanwhile, should grow 3.5 percent annually through 2018 and by 2.4 percent until 2024.
“On average, trucking will need to recruit nearly 100,000 new drivers ever year to keep up with the demand for drivers, with nearly two-thirds of the need coming from industry growth and retirements” Costello says.
The shortage, Costello explains, only applies to a particular segment of the industry. Private fleets and less-than-truckload (LTL) carriers, while occasionally experiencing some difficulties in hiring qualified drivers, do not have a shortage.
The deficit instead is confined to long-haul, over-the-road truckload carriers. The for-hire market, if you will.
“These are the folks that, not exclusively but in general, go out, pick up a load in Indianapolis, then take it to Austin, Texas,” Costello says. “Then, when they get to Austin, you tell them you have another load, about 20 miles away, so go pick that up and take it to Seattle. The driver is not driving a regular route. It’s an irregular route. The driver is crisscrossing the country, a region.”
WHY IS THERE A SHORTAGE?
The reasons for the long-lasting shortage in for-hire drivers, Costello says, are numerous. They include, but are certainly not limited to, demographics, regulatory concerns, and the simple fact that drivers are away from home for long stretches of time.
For starters, there’s an issue with pay. The average for-hire driver makes, according to Costello, less than $50,000 annually, maybe mid-40s.
“Now, the reality is there are a lot of drivers new to the industry and that is pulling down the average,” he clarifies. “If you’ve been in the industry for awhile and you’re good, you’re likely making well over $50,000.”
In contrast, drivers employed by private fleets see average wages between $75,000 and $80,000 annually, Costello says. “And I know of some private drivers that work for private fleets who make over $100,000 per year,” he adds.
Furthermore, private fleets don’t hire rookie drivers, Costello says. They’ll wait until a driver has several years of experience under his belt, accident-free record, before bringing them on. This means turnover is high.
After all, one could argue: who wants to deal with the lifestyle of a truck driver for a middle-of-the-road salary?
That underlines another prevailing problem, Costello says: The lifestyle of a for-hire truck driver is far from glamorous. You’re talking about several days, possibly even weeks, on the road at one stretch, a driving duration far longer than most of their peers in private and LTL fleets – and for less pay.
“It’s actually counter intuitive,” Costello says. “They (private and LTL drivers) are home more often and they make more money.”
And carriers, by and large, prefer for their drivers to live somewhere near or in the center of the country, Costello says. Think Midwestern regions, not coastal.
“That’s because if drivers are crisscrossing the country, it’s easier to get them home,” he explains. “Let’s say you have a driver that lives in Iowa and they pick up a load of freight in Denver and are taking it to Chicago. Well, if there is enough time, if you’ve got a little leeway on the load, you can probably get the driver home for a couple of days. But if the driver lives in Florida, it’s so hard to get them home.”
There is also a magnitude of lesser-known hiccups, Costello adds. For example, you have to be 21 years old to drive interstate freight in the U.S.
“We miss out on all those people coming out of high school who are not going to college and instead may go into the military or work in construction or another manufacturing sector,” Costello says. “Then, let’s say the driver is 21. Great, a carrier puts out an ad for drivers and candidates come pouring in, but they don’t have their CDL (commercial driver’s license). How do you get that? Well, you have to go to a truck driving school, but that can cost thousands of dollars, and many job candidates don’t have that kind of money or the credit to get it.”
Regulations play a significant factor too, he says. We’re talking about the implementation of new hours-of-service requirements and the federal government’s driver and carrier oversight program.
“Whether we support a proposed regulation or not, I have yet to find one that increases productivity,” Costello says. “As a result, at best, regulations are neutral, and in many cases, they decrease productivity. And if there is any decrease in productivity, it means you have to have some more trucks to haul the same amount of freight, which means you need more drivers and more trucks. That adds to the driver shortage.”
Will this driver shortage, in relation to current trends, really reach 245,000 on the basis of 750,000 trucks within a decade? It could, Costello warns, but he doesn’t see it happening.
Pure and simple, he thinks shippers will have their hand forced. Drivers’ market worth will go up, and with it, their salaries should too.
“Shippers are going to need freight moved, and they are not going to be able to do it any other way,” he says. “Trains, planes, and boats – they don’t pull up to hospitals, shopping malls, and grocery stores.”
National fleets are now trying more and more to keep drivers within a certain region. This, Costello says, could help with a bit with the lifestyle issue. “Let’s say the driver lives in Atlanta. Well, maybe you could try to keep them on freight that is only moving in the Southeast,” he says.
That said, there is only so much industry can do to help stem the tide, Costello says. There will still be plenty of irregular, cross-country routes that need to be driven. The lifestyle will remain unpredictable. Drivers will still be away from home for extended stretches of time. The starting truck driving age will likely not change, and regulations will always be barriers.
Additionally, many will still be vastly underpaid compared to others. But in an industry with very lean profit margins, carriers only have so much wiggle room in their budget without asking customers to pay more at the stores, Costello says.
“If I turn around and say, ‘My drivers deserve more money, and I’m going to give it to them,’ great,” he explains. “But if I go to a shipper and say, ‘Hey, I just gave my drivers a raise, they deserve it, but now I need to charge you more,’ that shipper is going to go, ‘Whoa! Whoa! Whoa! Wait a minute.’ And I don’t blame them.”
But in a nation with an unemployment rate still hovering well above 7 percent, what could be better for blue-collar workers than pursuing an occupation that, despite its unfavorable lifestyle, remains in such high demand?
“I mean, how many blue-collar workers have employers beating down their door to get them to come and work for them?” Costello says.
These are all reasons why we should all be so respectful of truck drivers, he says. “They do a service for our economy that they are largely underpaid for, and live a lifestyle many don’t want,” Costello explains. “That is, in a very simplistic sense, why we should all care about the truck driver shortage.”
About the American Trucking Association
American Trucking Associations is the largest national trade association for the trucking industry. Through a federation of 50 affiliated state trucking associations and industry-related conferences and councils, ATA is the voice of the industry America depends on most to move our nation’s freight.