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Why the Great Driver Shortage Is Now Top of Mind for Shippers & a Driver of a Capacity Crunch

The Great Driver Shortage

The Great Driver Shortage was already starting to weigh on the minds of carriers and shippers early this year as experts predicted tightening capacity, said William B. Cassidy of the Journal of Commerce (JOC), and the continued climb of the stock market alludes to an imminent, modern-day Industrial Revolution. At the same time, carriers have turned to leaner operations to keep costs down, and the transportation industry is ready to implode with a capacity crunch that lasts well into 2018 and may only get worse from there. Now, the driver shortage is more than just a slight hiccup in the industry. It is the top concern for shippers, and you need to know what it means for the capacity crunch.

The Great Driver Shortage Is the Primary Concern for the First Time in 11 Years

As explained by Dustin Braden of the JOC, the Great Driver Shortage is the top concern among shippers and carriers alike for the first time in 11 years. In fact, the truck driver shortage is expected to double to 100,000 in the next five years, but other industry experts, reports Iris Kuo of Trucks.com, suggest actual worsening could be as high as 200,000 unfilled positions by 2026.

Drivers Have the Bargaining Power to Demand Higher Wages, Better Treatment, and More

The surging demand for drivers is having a predictable effect on truck drivers wages and benefits. Over the last four years, trucker wages and benefits have risen 7.6 percent on average annually, but driver wages rose the same 7.6 percent by the end of the third-quarter in 2017. In addition, wages and benefits for truckers now exceed commutative fuel costs, making the driver shortage responsible for increasing freight shipping rates.

This means drivers have more bargaining power over carriers, including which shipments they will accept, what hours they will work, how shippers treat them and more. If anything upsets trucker, a new job can be found by the end of the day. Even truckers under contract are subject to poaching from other carriers. If a trucker wants to work with a new carrier, chances are good that the carrier will pay the buyout rate for the trucker’s contract. Consequently, carriers and shippers have a duty to ensure the utmost treatment, respect, and attention to the needs of their drivers.

The 2017 Hurricane Season Hit Top Driver Recruitment Areas

The trucking industry shuttered as Hurricane Harvey made landfall in Texas, which is among the top trucker recruitment areas in the country. However, the short-term impact on trucking recruitment could be balanced through increased trucking recruitment in the second-leading recruitment area in the U.S., Florida. However, Hurricane Irma quickly disrupted that plan. While the infrastructure disaster in Puerto Rico continues, the aftermath of Hurricanes Harvey and Irma have taken a backseat, and these areas are struggling to get the trucking industry moving at all.

Unfortunately, this extended return to day-to-day operation in the coastal trucking industry means the loss of thousands of potential truckers who have moved to other areas, away from the trucking-recruitment hotspot. In response, the Great Driver Shortage is expected to worsen, explains Lawrence J. Gross of the JOC.

More Owner-Operator Truckers Will Retire Due to New Regulations

The electronic logging devices (ELD) mandate is another driving force behind the capacity crunch. Although the Federal Motor Carrier Safety Administration (FMCSA) maintains a list of approved ELD vendors, industry experts have found vendors offering subpar devices that do not meet the minimum criteria set forth within the mandate, explains Jeff Berman of Supply Chain 24/7.

Even the biggest carriers are not exempt from this risk; a carrier with 300 trucks found its chosen vendor was using ELDs that did not meet the minimum criteria of electronic logging devices that predate the new ELD mandate. Due to this confusion, in conjunction with the stress of implementing the ELD mandate itself, truckers that have not yet implemented an ELD, most of which are owner-operators, are more likely to retire rather than deal with the stress.

What Can Shippers Do About the Great Driver Shortage?

The Great Driver Shortage is not something that can be repaired overnight, and shippers can do something to help prevent it from worsening. Shippers should partner with carriers to create a graduated commercial driving license programs that attract younger drivers, and the Department of Labor is already working on a national driver recruitment program. This will help the industry acquire the interest of the next generation in becoming truckers. This is not the driver shortage from your grandfather’s time; this is the Great Driver Shortage. It will not resolve on its own, it will not lessen, and addressing it is essential to mitigating the capacity crunch’s effects through 2018 and beyond.

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Adam Robinson
Adam Robinson oversees the overall marketing strategy for Cerasis including website development, social media and content marketing, trade show marketing, email campaigns, and webinar marketing. Mr. Robinson works with the business development department to create messaging that attracts the right decision makers, gaining inbound leads and increasing brand awareness all while shortening sales cycles, the time it takes to gain sales appointments and set proper sales and execution expectations.
Adam Robinson
Adam Robinson
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