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What Driver Shortage?

By Steve Banker Guest Writer

In the latest State of Logistics Report, it is reported that the trucking industry is currently short by about 30,000 drivers. Logistics professionals are frequently warned by trucking trade associations and big carriers about how CSA regulations have reduced the driver pool, and how Hours of Service will reduce driver productivity by perhaps 8 percent on average.

 We are also told that we have an aging driver workforce and that there will be a large turnover due to retirement in the next ten years (the article cited below says that 14 percent of drivers are between the ages of 55 and 65). In short, we are told, things are bad and getting worse. One key cause is that the government has become too intrusive and needs to roll back these regulations.

And yet if you look at driver salary trends, there is a real disconnect with the driver shortage story. The National Transportation Institute (NTI) has the best ongoing statistics on US driver pay. Gordon Klemp, a Principal at NTI, gave a speech based upon 2012 fourth quarter data that was posted on YouTube. Across the categories of Dry Van, Refrigerated, and Flatbeds, salaries have barely budged over the past year. In fact, driver wages are today much the same as they were back in 2007! The rate of inflation has increased substantially faster than driver wages. If there really was a driver shortage, the law of supply and demand tells us wages would have risen!

A driver’s job is tough – long periods away from the family, unpredictable schedules, and a job that is just too conducive to becoming overweight and suffering health problems. Now on top of the other issues is the issue of career viability. I’m not sure truck driving can be a long term career anymore. A recent Wall Street Journal article was titled “Daddy, What Was a Truck Driver?” Right now the drivers being obsoleted are not on-road drivers. The article reports on an Australian iron ore mine where 45 autonomous trucks are being introduced at the cost of 180 driving jobs. But who can doubt this will eventually take jobs from on-road drivers?

Bill Ford, Chairman of Ford Motor Company, says they will offer self-driving cars by 2025. And because of the economics, the autonomous truck market may initially be far larger than the market for autonomous cars. Basically, as soon as there are autonomous cars, there are apt to be autonomous trucks. In short, in twenty years or so, drivers may start becoming obsolete.

I don’t think the career viability issue will keep folks from entering the field. Historically, when construction jobs became difficult to get, there was an influx of these folks into the field. Also, we are now producing a generation of liberal arts college graduates who are finding it difficult to find decent paying jobs. But I think if you look at this issue from a truck driver’s perspective, all the alarm about the shortage of drivers is hard to understand.

At one point in his speech, Gordon Klemp refers to CSA regulations “Many tell me, I could have hired that guy a few years ago. Today I can’t touch him. (It’s) not worth it.” As someone that shares the road with truckers, that kind of statement does not lead me to think CSA is such a bad thing

Steve Banker, Ph.D., is the Service Director, Supply Chain Management of the ARC Advisory Group, an international industrial advisory company. Steve is a columnist at Logistics Viewpoints, has authored many market research and strategy reports and has managed consulting projects for manufacturers, retailers, software providers, and venture capital firms.

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