Quick Transport Solutions Inc.

Approaching Shortages, Capacity Issues, And Innovation In Trucking

With the economy showing continued strength, the trucking industry copes with several problems on multiple fronts. From the truck driver shortage to capacity problems and the inability integrate advanced technologies into legacy systems, the trucking industry has a lot at stake.

Pundits, industry insiders, executives, truck drivers, and just about anybody else who makes a living in the transportation industry knows that at some point there has to be a contraction. Either companies must innovate in their efforts or face a market where they may be left behind.

Is It Generational?

The first bit of soul searching is happening at the employment level. As fleets work hard to address the employment squeeze, they are taking an introspective look. Although the number of truck drivers in North America has held steady over the past couple of decades, at just over 3 million, tonnage has steadily increased over the same decade, with the single exception being the recession period from 2008 to 2009.

The industry wants to know: Why is it so hard to find truck drivers to fill the need? Some say the answer lies in looking at the demographics. Ranging from 54 to 73 years old, the Baby Boomer generation is moving into retirement. Over the next ten years the trucking industry will need to add nearly half-a-million new truck drivers just to keep up pace with pending retirements. But where is Generation X?

The simple answer is that there are fewer people in Generation X than there are in the Baby Boomer generation. Generation X does not offer the same depth of labor pool as prior generations, as only 69 million babies were produced during this generation. Could it be that the Millennial generation is the answer? Born between the early-80s and early-2000s, the Millennial generation represents 86 million people.

With many of this generation just now entering the workforce, some believe Millennials could be the answer to filling in the gap being left as Baby Boomers retire. Being the largest generation born in the United States, the talent pool is huge. And the generational shift doesn’t stop in the cab.

Right now, Generation X – people between late-thirties and late-50s, are the highest earners in the economy. They are also the highest spenders. Consider the demand a maturing Millennial generation will create. The truck driver industry simply needs to find a way to better talk to this generation. With Baby Boomers maturing and replacing the generation before them, which was the smallest generation 100 years, entire industries will need to adapt.

Some question this logic, however. Surveys point to the fact that Millennials are more likely to change jobs than middle-age truck drivers. Yet, the numbers are slight. Millennial operators are only slightly more likely than Gen X drivers to abandon their motor carrier.

In the survey, the greatest factor impacting truck driver retention was the lack of professional experience. There simply are a lot of new truck drivers out on the nation’s roads. With truck driver turnover peaks coming between 26 and 30 years, how will the industry adapt?

Where Does the Industry Stand?

Industry-wide truck driver turnover was 86% in 2017, which was up slightly from 2016, though both years are down measurably from years and decades prior, when attrition hovered in the mid-90th percentile on a regular basis. This showed in industry surveys.

In 2016, the truck driver shortage was sixth on the surveyed list of top truck driver and trucking company concerns. Last year it was at number one. While truck drivers will say that there are many things that need to be fixed, from truck parking to compensation, the moral of the story is that in 2018, nearly every motor carrier in business has likely had to turn down a profitable load because they could not find a truck driver to take it.

While some of this is seasonal, with big employment shifts occurring in April, this past April the industry lost a bit more than expected, at 5,500 jobs lost. This represents the most significant employment decrease within the truck driver segment in nearly three years.

As truck drivers retire, shift fields, or move on to other endeavors, the trucking industry must bring in new and younger truck drivers, though that is appearing easier said than done. While the industry has done a good job getting more involved with trade schools and education, it could do more to attract a generation that has specific needs and wants. Is the industry selling itself properly in the age of market competition and low unemployment?

The Current Picture

Typically, the average CDL candidate entering the truck driving workforce today is in their early to mid-30s. In many cases they are looking for a career change. Sometimes they simply need to be opened up to the pull of the road. But why aren’t higher school age kids getting into trucking after graduating? Should the federal age limit be lowered to 18 – 20?

Others point to congestion between a large problem. It is hard to attract younger drivers to the life on the road if they can look forward to an average of 996 annual lost hours to congestion and road problems. Heavy traffic, a lack of parking, and regulations make many long-haul routes far less desirable to potential truck drivers.

As e-commerce takes hold, truck drivers are also moving to more urban, suburban and regional routes. This bleeds available talent away from long-haul and specialty operations. Operators make this decision because the shorter, regional routes offer more home time, which routinely ranks at the top of their concerns about entering the industry.

The fact is, companies that put a focus on retention typically keep their people for longer. Executives must make a conscious effort to focus on proper outreach to younger people and effective methods for retaining them once they have come on board.

Pay Increases

Although wages do not rank as the most important issue for truck drivers, they do rank as an issue none-the-less. In positive news on that front, truck driver pay has risen 15% since 2013. This represents an annual increase average of $7,000. The finding of the ATA study correlates with what fleets are reporting as they raise across-the-board wages in an effort to address the shortage.

The ATA pay survey was compiled across a data set of over 100,000 truck drivers. It proves that motor carriers are reacting to market conditions by improving benefits packages, offering higher sign on bonuses, and increasing overall pay. Private fleet truck driver pay climbed to $86,000, which represents an 18% increase from 2013.

With bonuses ranging in the thousands and hot commodities like 401k matching on the table, motor carriers are on an all-out assault to find and retain top talent. Will it staunch the employment bleeding, however?

Fleets Use Technology to Adapt

Motor carriers are increasingly turning to technology to address the capacity crunch. By using fleet management systems, routing and scheduling systems, and other methods, motor carriers are squeezing every last ounce out of their current systems.

With constraints coming from every corner, businesses are adapting. Freight routing and scheduling software can buffer a lack of truck drivers to handle critical loads. These types of systems can be used to keep schedules consistent, ensure as little downtime as possible, and alleviate logistics headaches.

Ensuring routing can be done in advance of the run better prepares the truck driver and carrier for whatever the conditions are going to be on the road. As capacity continues to get tighter, customers will want to take greater ownership over their own route planning and scheduling. Will motor carriers be able to adapt?

Routing data will become part of a holistic network accessed by motor carrier, shipper and receiver. Systems will need to be integrated, regardless of the vendor. With so much fragmentation in the ELD market, trucking industry analysts openly wonder whether legacy fleets will be able to make the transition.

Fleets have also turned to comfort for the answer. Cabs are more advances than ever, with creature comforts truck drivers from decades ago couldn’t have imagined. Although the ELD mandate and hours of service regime continue to create constraints, safety and adaptive systems provide truck drivers with the incentive they need to hop in the cab and join a fleet.

In the end, whether the problem is generational, pay-related, or simply a matter of wanting to spend more time at home with family, the trucking industry has an obligation to ensure its image as a rewarding career filled with new sites, new people, and potentially lucrative pay stays consistent. No matter how old potential recruits are, they will not respond to a job ad that does not provide them with a clear window into seeing themselves behind the wheel of a big rig.

0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

0
Would love your thoughts, please comment.x
()
x
About QuickTSI

QuickTSI is your one-stop-shop for everything you need to run your transportation and freight logistics business. Our website allows you to post loads or find trucks, post trucks or find loads, look up carrier profiles, view trucking companies, find truck driving jobs, and DOT medical examiners.

Mailing Address

Quick Transport Solutions, Inc.
11501 Dublin Blvd. Suite 200
Dublin, CA 94568

Contact Us

510-887-9300
510-284-7280

Terms & Conditions    Privacy Policy

Cookie Policy    Content and Data Usage

© 2011-2024 Quick Transport Solutions Inc.