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The “driver shortage” is best thing to happen to truckers. Stop whining about it.

Fleets execs that whine about the driver shortage are wrong

 2018 Mack Anthem- a whole new redesign from Mack Trucks
2018 Mack Anthem- a whole new redesign from Mack Trucks

Commentary

The “driver shortage” is the best thing to happen to trucking.

Most of the executives in the space lament the challenges of finding and recruiting drivers on analyst conference calls and at industry conferences- but you can bet they are celebrating behind closed doors.

First off, we have argued that the driver shortage does not exist. It’s all comes down to economics.

Some have attacked this view as incomplete. Most notably by John Larkin in an op-ed submission on FreightWaves.

John argues that pay is only half the story and there are other fundamental problems (driver abuse at the hands of shippers; voice brokers that take advantage of drivers by screwing them out of detention- even when they collect it; carriers that fail to maintain equipment and not honor driver home-time; truck stop chains that fail to keep clean restrooms; a lack of parking- etc).

There is no driver shortage in Australia, but drivers there make over six figures.

If you think American drivers have it tough, talk to a driver that has had to deal with Kangaroos, dirt roads in the outback, or 7 of the most poisonous spiders or snakes in the world. The rest stops and truck stops on the outback are rarely clean and maintained. It makes the conditions at a former truckstop known as Carl’s Corner (before Petro took over) in central Texas seem like the Four Seasons. 

But the driver shortage is a blessing because it means: Pricing power.

Without it, rates would be a race to the bottom. The cheapest carrier would win. I hate to say this- but trucking is a commodity and to argue otherwise, is to miss out on the most important decision that a carrier, broker, and shipper deal with and that is pricing/rates (otherwise why do the RFP or get quotes)?

The driver shortage gives carriers pricing power and the fewer drivers there are, the more power a carrier has in the market. With would-be drivers seeking employment in other sectors of our economy (retail, food-service, construction, oil field work, Amazon), it keeps a natural governor on how much capacity can enter the market. There are few barriers to entry already. Anyone can buy a truck (used or new) and getting an operating authority.

Without a driver shortage, large enterprise fleets would expand faster. Anyone that has ever talked to a successful trucker knows that the number of trucks they have is their favorite stat and a way of keeping score. It’s very “kindergarten-playground-esque”, but still a favorite among the most successful truckers.  

The ELD mandate will do two things- take supplemental capacity out of the market, due to drivers themselves not wanting to adhere to the rules and eliminate the carriers that are not operating under the HOS rules. Drivers that operate with ELDs and compliant, shouldn’t complain. they will become enormous victors in the end. 

Rates are going up and will continue to do so as long as we have a strong labor market, GDP expands more than 2% per anum, and we fail to get immigration reform that allows for unskilled workers to gain proper employment.

If you are a fleet with unseated trucks- let me suggest this- while it is incredibly painful to have an underutilized asset on your books- invest some of the rate increase in recruiting, pay, and driver incentive programs that make your fleet the premier choice. Also, I am sure that drivers would appreciate a nicer truck with more comfortable seats. Too bad Bose Ride did not survive.

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One Comment

  1. This is the first article on the supposed "driver shortage" that gets it. Namely that it’s a major good thing, not a bad thing.

  2. Boondock54x4, here.
    I’ve held a CDL for well over 25 years, helped several good people get in and back out of the driving industry.
    Watched them be mistreated by carriers, shippers, recievers, ect. While I learned my lesson long ago.
    You want a guy like me back in the seat?
    I need $5K/month, home once ever 8 days, and no BS when Ihave to be home for family stuff.
    With that, I’ll contract 2500 miles a week, and abide by this shit called ELD. The layovers and waiting at shippers and recievers is your problem, not mine. If the layovers get in the way of the mileage,once again, your roblem, not mine. Truck maintenance, regardless of cause, your problem, not mine.
    If you want good driver, you’re going to pay me, period.
    Otherwise, I stay home, turning wrenches, hanging with the family.

  3. Australia has high rates because of a long established oligopoly.

    Truckers always complain in US about everything and that is their M.O.

    Will be interesting to see who "quits" over the ELD mandate. I suspect it will turn out similar to how a lot of Hollywood types threatened leaving the US if Trump was elected. They are all still here… 😉

  4. Far too many regulation and not enough pay and home time. Also crumbling infrastructure not worth the risk not even for driverless trucks especially.

  5. This article is the biggest piece of "horse-hockey" I have read.

    The only part of the article I do agree with is that there ins NO Driver Shortage. There is a DRIVER RETENTION issue … and it stems from utilizing non-predictive hiring practices (Screening for qualifications and hiring from qualifications) rather than screening for QUALITY and hiring from qualified applicant of that sub-set.

    If folks are not sure what I mean … hopefully, this will explain it better.

    https://www.linkedin.com/pulse/feed-me-more-really-tj-graff/

  6. This is about how drivers are treated. Companies that retain drivers are the ones who treat their drivers with respect and stand behind their drivers when there are issues with customers. I have been in this business for twenty-seven years and I am currently a Terminal manager and I am told daily by my drivers that I am the reason why they stay and work for our organization. I go out of my way to be fair to my drivers, ensure their payroll is accurate and that the work is balanced between all drivers so they are all making money. This is how you retain drivers and run a successful operation.

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