Why is There a Professional Driver Shortage?

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It depends on who you ask. A recent report says that we need 50,000 new drivers right away, though the estimates definitely waver. Ask a current driver who’s waiting to be unloaded at a dock, and he will disagree with you – the Bureau of Labor Statistics assesses that 94% of drivers are male. Ask a recruiter for a trucking company, and they will tell you that it is real.

There are three points in history that I look at for these statistics. First, interstate workers were exempted from parts of the Fair Labor Standards Acts (FLSA) passed in the 1930s. Second, the industry itself was deregulated in 1980. And third, on December 17th of 2017, the Electronic Logging Device (ELD) Mandate took effect. These are all part of the issue.

FLSA

Exemptions were written into the FLSA that for interstate workers like myself, we are not required to be paid for all of our time spent working. We aren’t subject to overtime pay provisions. A driver waiting at the dock to be loaded or unloaded doesn’t have to be paid.

So for drivers like myself who spend ten to thirty hours a week working, we are not making money for these stretches of time.

1980s Deregulation

In 1980, the economy was struggling. Deregulating the trucking industry and lowering freight rates was seen as a way to boost the economy. Coincidentally, it was a historical high point for truckers’ wages. Todd Spencer, president of the Owner-Operators Independent Drivers Association (OOIDA), appeared on Fox Business News. Stuart Varney assumed that the current driver shortage was due in part to drug testing. Spencer squashed this notion, as drug testing has been a regular feature of truck driving for years. Instead, he put the “shortage” on economics and said that today’s driver makes less than half the money that drivers made in 1980 (adjusted for inflation).

Paying half of what the industry paid 38 years ago may just not be enough.

ELD Mandate

Before December 2017, many drivers were still using paper logs. A legal and accurate paper log should be very close to the same as an electronic log. The days of drivers carrying extra log books and cheating excessively were over long before the mandate. We are tracked electronically in ways that did not exist thirty years ago. Drivers in 2017 were not so much cheating as “fudging”. We could work to the edge of a paper logbook with every intention of running legal. If something unforeseen happened to delay us, we could “fudge” it on paper. The ELD takes away the fudge factor, and we may not be able to run as close to the edge as we did on paper.

The mandate was expected to lower productivity by about 4%, according to Noel Perry from FTR Intel as quoted in Freight Waves. Combine that with an economy growing at 3%, and you create a capacity crunch. While the industry has been crying wolf for decades about a driver shortage, just like the villagers in Aesop’s fable we don’t believe them anymore.

Todd Spencer told Fox Business News that we attract over 400,000 new drivers every year. The industry needs around 3.5 million CDLA drivers. We attract enough new drivers, but the problem is that we don’t keep them. Turnover rates in this industry hover around 98%. Of that 98%, we don’t know how many are changing companies or leaving the industry entirely.

I called Ben Schill from Paper Transport – who I have worked with for twelve years – in Green Bay to ask what we are doing. Paper Transport’s annual turnover rate is 67%. We currently have a ratio of 60% regional drivers and 40% home daily drivers. They are working on flipping that ratio. Paper Transport has many regular routes. Some of these routes are out and back, others are relayed. Say you have a 500-mile origin to destination run. Normally, a driver would have to spend a night on the road. Paper Transport and similar companies can now relay those loads where drivers meet at the halfway point and head home every day.

According to Schill, the critical time for retention is between one and two months. 40% of the turnover is during that time period. The company is trying to lessen the problem in part through connectivity.  We have an in-house social media page for drivers. We also have a mentor program where new drivers team up with experienced drivers. Schill also told me that the new generation is more demanding than I was starting out back in 1988. Back then if you wanted to be a “home daily driver,” you expected to have to spend a few years on the road. These new drivers can demand “home daily” positions right out of driving school and get them.

We are also facing an aging driver population. According to the Bureau of Labor Statistics, the average driver is 55 years old. Between sitting long hours and eating on the road, many of these drivers are facing health problems. We need to find a way to keep these drivers healthy and willing. At 59, I don’t have the need or the desire to work as hard as I did at 29. Companies need to work with us older drivers. We can also do a better job of showing older drivers how the new technology works.

We need to figure out how to keep safe drivers behind the wheel. The ELD mandate did not create any problems. It exposed them. We can’t cover them with paper anymore. Lowering safety standards is not the answer. We can bring teen drivers into the industry with graduated licensing. Right now, teen drivers are in intrastate, but not interstate trucking. Using state lines for young drivers is antiquated. I have a friend who owns a company in Quincy, IL along the Mississippi River. He can send a young driver over 300 miles into downtown Chicago, but can’t send them across the river.

We need to keep drivers moving. Shipping and receiving docks have become less efficient over time because there was no cost for holding up a driver. Back in the ’70s and early ’80s, I worked in warehouses loading and unloading trucks. We picked and staged loads before the driver arrived. When a truck arrived we could load them in under 30 minutes. When we unloaded trucks, we took the freight off and put it on the dock. After the driver left, we put it away. We did this because we were charged to have the truck sit.

That changed over the years. Orders were picked and loaded after the truck arrived. Freight was being put away as the trucks were being unloaded. This process saves the warehouse about 30 minutes of their time and costs the trucker about two hours. This saved money for the warehouse because they rarely had to pay for driver time. Drivers could condense this time on paper. Productivity was not interrupted. Charging shippers and receiver for driver time would encourage efficiency.

Solutions

Raise the pay. It sounds simple, but what will this do to consumer prices?

Not much.

Take one of my typical loads – beer from Saint Louis to Green Bay. It pays me about $250. There are a lot of cans of beer in a beer load – about 61,000 cans. That means for each can, about 4/10ths of a penny went to the driver. If you were to double driver wages, the cost would still be less than a penny per can.

Government

The government could do a few things to help.

Relax the hours of service. Currently, drivers are basically allowed to drive up to 11 hours within a 14 hour period. If a driver starts work at 7 AM they are not allowed to drive past 9 PM. Allow the driver to extend that 14 hours once per week.

Include driver turnover rates in a trucking company’s CSA (comprehensive safety analysis) score.

Reform and update what a mile is. Many trucking companies use a standardized mileage system called the household movers’ guide. It is a shortest route zip code to zip code system. Over the years I average about 93%. That is for every 100 miles that I drive, I have gotten paid for 93 of them. The guide picks the shortest possible routing. This could include routes that might not be legal for the equipment that we are using. These routes can vary. I had a load this week that paid for 578 miles. My Garmin routing had it at 663 miles. Mapquest put it at 660 miles. Shippers can manipulate their addresses. I remember one distribution center in central Florida where the facility was 14 miles south of the post office facility on their address. There may have been another post office south of that facility, but they chose the one north of it. Why? Most of their freight comes and goes north. We have the technology for door to door mileage pay. Use it. It is a fair labor issue and a measure.

Shippers and Receivers

The term “shipper of choice” has become familiar since the ELD mandate. Shipper of choice is not just about rates. It is about the treatment of drivers. Many facilities still will not allow driver bathroom privileges. That is demeaning and unhealthy. Let drivers park overnight. One of the unintended consequences of the mandate is that it has created a truck parking shortage in many areas. That forces driver to start their 14-hour clock early because we are trying to be on time and have to budget for things like traffic jams and RR crossings. That time is wasted. Letting trucks park at facilities is a benefit for both customer and trucker.

Trucking Companies

Hire the right fit. Recruiters are under a lot of pressure to recruit volume, but not necessarily fit. Many recruiters will tell drivers what they want to hear. That is a two-way street. Drivers tend to hear what they want to hear and say what they think the recruiter wants to hear. Getting the wrong fit benefits no one and drives good drivers out of the industry.

Be involved in driver wellness. Poor health has forced too many drivers out of the industry. The average length of haul has decreased significantly over my 30 years. Encourage drivers to enter local events such as 5K events. Working with drivers to manage their health does more than improve their health. It makes them feel a part of something.

Equipment

Companies may spend upwards of $150,000 for a new truck. Don’t get cheap with the driver’s seat, or the mattress. Invest in anti-idling equipment, specifically Auxiliary Power Units (APU). Drivers should be able to sleep in temperature-controlled comfort without idling the truck. Many companies have idling provisions in their bonus packages. I am good with that. Excessive idling increases maintenance costs as well as fuel costs.  Just give the drivers the ability to get a good night's sleep without idling the truck.

Make sure that the driver understands how the equipment operates. Every time a driver gets a new piece of equipment train the driver on it. Too often a driver does not optimize the equipment because they don’t know how it works. I remember giving a presentation to a group of about 40 drivers from a company about idling. According to one engine report, the driver idled the engine 37% of the time. (My idle average is less than 6%.) The truck had a new $14,000 APU on it. I was talking to the owner of the company after the presentation. I asked about that one truck and the company owner was obviously frustrated. This driver was a long time employee and a good driver. I asked the owner if anyone had ever shown the driver how the APU worked. The answer was a resounding no!

Conclusion

We recruit enough new drivers, maybe we recruit so many that they have become disposable. In essence, we have been turning up the faucet without closing the drain. Finding innovative ways to increase efficiency will help. It goes beyond that. We have to find ways to keep drivers wanting to stay, so we can succeed in our industry and you get your shipment on time.