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Supply Chain News: Some Straight Talk on the Truck Driver Shortage - The Job is Terrible, Researcher Says

 

Ivy League Sociologist Drove Truck for Several Months as Research for His New Book

March 13, 2017
SCDigest Editorial Staff

The acute truck driver shortage in the US (and indeed many other parts of the world) continues on, though the situation was somewhat muted in the soft freight environment seen in 2016.

Still the American Trucking Associations (ATA) estimates there is a shortage of almost 50,000 drivers nationally - and number than could surge into the hundreds of thousands in coming years.

Mike Regan of TranzAct Technologies, a well-known observer of transportation-related matters, recently said in a video interview with SCDigest that "I talk to a lot of carriers, and the top three items on their agenda continue to be driver recruitment, driver retention, and driver satisfaction" in the face of the on-going shortage.

Supply Chain Digest Says...

The industry could fix its labor shortage, Viscelli says, by raising pay enough to compensate for the hardships of the job or improving the terms for independent contractors.

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In that interview, Regan also warned that if President Trump really does get a large infrastructure program going, all those construction jobs that will be created likely will attract many drivers away from their current employment, further exacerbating the problem.

In the past few years most major carriers have increased driver pay in the hopes of improving driver attraction and retention, but government data continues to show the average driver makes only in the low $40.,000 range for a job that comes with a tough lifestyle.

"The job is terrible, and the companies know it," says Steve Viscelli, a University of Pennsylvania sociologist and the author of The Big Rig: Trucking and the Decline of the American Dream, a book for which he spent several months as a driver as part of his research.

Viscelli says drivers for many companies last, on average, just six months. Some manage to stick it out for a full year, but often only because they owe the trucking schools tuition money plus interest, he says. Many of the 800,000 or so workers employed by long-haul truckload carriers are classified as independent contractors, meaning they receive no benefits, and are often barely making ends meet.

"It's brutal on your family, on your body, on your life." Viscelli says, noting that turnover at some carriers is 300%, meaning the companies hire three people for one job over the course of a year.

Many new drivers, Viscelli told The Atlantic magazine, think they're going to earn a lot of money as a trucker, something they soon learn is not the case. Though trucking firms advertise starting salaries around $60,000, truckers with less than two years of experience actually earn around $30,000, Viscelli says.

However, truckload carrier Celadon, based in Indianapolis, says that new drivers who complete a year of driving make $50,000 and up. But beginning drivers make only 21 cents to 25 cents a mile, which amounts to about $25,000 to $30,000 a year. They're paid less because they are in essence repaying the company for their schooling, which is tuition-free.

Graduates have to drive 120,000 miles at the lower pay rate, or owe the company $5,600.

Carriers sell the idea of being a contractor to drivers with the vision of being their own bosses, but the arrangement often saddles them with unsustainable debt and high expenses, Viscelli notes.

Those starting as independent contractors sign lease-to-own deals to purchase their vehicles, often with the carrier. But the terms are onerous, Viscelli says, and drivers owe so much that they may end up working 70 or 80 hours a week just to pay back what they owe and cover expenses such as fuel and insurance. Drivers are suing some companies that use this model, saying they should be classified as employees rather than contractors, with mixed success to date.

Even those working as employees have a hard time making ends meet, partly because they are only paid for the miles they drive, not time waiting to load and unload their rigs or sitting in traffic. Viscelli told the Wall Street Journal that when he was working as a driver, he had a 16-hour day crawling through traffic in the New York City area, only to get stuck at a New Jersey rail yard for the night. That day he drove 215 miles and earned just $56.

 

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The inevitable result of these conditions? Drivers burn out quickly and quit, creating the very high turnover rates.

The industry could fix its labor shortage, Viscelli says, by raising pay enough to compensate for the hardships of the job or improving the terms for independent contractors. Many observers have said wages need to get over $60,000 annually to have a serious impact on the shortage, but Walmart has to advertise to attract drivers for its private fleet that it says has pay of $72,000 and offers a much easier lifestyle, with drivers being home far more often than long-haul drivers working for a carrier.

The ATA has found turnover rates for drivers has been on the decline recently, a factor of some impact from many carriers increasing wages and a soft freight environment in 2016 that made drivers more cautious about changing jobs and switching to another carrier.

In December, the ATA reported that driver turnover fell 19 percentage points year-over-year to 81% in the third quarter for larger truckload fleets, dropping to the lowest level in five years.

But TranzAct's Regan says we're just a strong quarter of economic growth that stokes freight volumes away from being back in the soup in terms of a driver shortage, with capacity being highly constrained as a result.

Autonomous trucks without drivers may solve the problem one day, of course, but that is not likely to be for a number of years, as regulations are far behind the technology in terms of deployment.


Is the job of truck driver as bad as Viscelli says? How high do wages need to go? Let us know your thoughts at the Feedback section below.

 

Your Comments/Feedback

Garcia

Company driver, KKW
Posted on: Mar, 24 2017
Yes,especially for a family guy. Wages should be $50 to 65K to start depending on region of residence. A man needs at least $920 to $1120 a week bring home pay to stay motivated.
 

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