Archives/Subscribe | October 10, 2011

Driver shortage reaches 188,000 By Mitch Mac Donald DC Velocity

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Lana Batts, a partner in the transport advisory firm Transport Capital Partners is a long-time observer of the transportation and logistics industry. Among other posts, she served as vice president of government affairs for the American Trucking Associations (ATA) in the 1980s and early 1990s and as president of the ATA's Interstate Truckload Carriers Conference from 1994 to 2000. 

It was during Batts' term as president of the Interstate Truckload Carriers Conference that we conducted an interview with her at ATA headquarters in Alexandria, Va. That day, we asked her to name the top 10 issues facing the truckload sector. Her answer: "Well, nine of them would be the driver shortage, and if pressed for a 10th I would have to say the driver shortage." Those words were burned into the cerebral hard drive, where they remain to this day.
DC Velocity Senior Editor Mark Solomon describes the sometimes extraordinary measures truckers are taking to retain drivers assuming they're lucky enough to find them in the first place. 

Despite a protracted economic downturn and lingering unemployment (just shy of 9.2 percent as this writing), literally thousands of big rigs are sitting idle for lack of a driver. As Solomon reports, the consultancy FTR Associates estimates the U.S. trucking industry is short about 188,000 drivers right now. Industry projections are that as many as 400,000 may be idle by the end of 2011. 

If finding drivers is tough, retaining them is a challenge of almost epic proportions. Based on first-quarter numbers, the American Trucking Associations projects that driver turnover at large truckload fleets will reach 75 percent or more in 2011. In real terms, that means three out of four drivers in a given motor carrier's employ will leave the company within a year. 

Things are only marginally better for the smaller truckload fleets. Historically, these operations experience lower rates of driver turnover, or "churn," than their large national counterparts because the hauls tend to be shorter. But even these fleets are struggling with the revolving door right now. At these operations, one out of every two drivers is leaving within a year. 

Where are they going? The good drivers are following the money. The drivers who have had bad experiences with CSA are leaving the industry because they feel they have no other avenue. 

Experienced drivers with the proper credentials have become a hot commodity in the logistics world. It should probably come as no surprise that many are making themselves available to the highest bidder. 

So what does this mean for the logistics executives responsible for keeping their company's goods moving smoothly through the supply chain? It's not hard to connect the dots. Carriers are finding they must pay more to recruit and retain drivers. And if carriers have to pay more, you can be assured there will be repercussions for the shipper. 

Lana Batts' words continue to resonate with us today, and not just because she summed up the problem so memorably.  But also because the threat has only intensified over time. The driver shortage might not just be the top issue facing motor carriers, but the forces behind it are getting stronger every day. 

The latest proposal by the FMCSA asks Congress for the power to fire drivers based on PSP scores. The day this happens, the price for drivers will go through the roof  and so will the rates imposed on shippers. 

The cost for carriers to do business under CSA is shooting up. The bidding war for drivers (that no carrier wants to be a part of) has begun and will increase faster and faster as changes in CSA are proposed and/or introduced. 

Rickey Gooch 
Justice for Truckers 


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