By Randolph Heaster MCT News Service
Industry sees 100 percent turnover. Wages not enough to keep drivers on tough job.
Current estimates are that the U.S. is shy 20,000 long-haul drivers. A recent industry study said the shortage could rise to 111,000 drivers by 2014.
Despite demand, wages have stagnated and turnover in the industry is running more than 100 percent. Potential drivers have migrated to construction jobs, where the pay has been better and they don’t have to be constantly away from home.
Even as the industry struggles with the shortage, talking about higher pay and attracting immigrant drivers, trucking officials say it is everyone’s problem. Trucking moves more than 70 percent of the freight in this country, making it an essential link between the consumers and the things they want and need. At some point the shortage will mean delivery delays and higher prices for consumers.
”Without truck drivers, nobody’s got food on their shelves, clothes on their racks and electronics in your big-box stores,” said John Wagner Jr., president of Wagner Industries Inc. of Kansas City. ”The average age of drivers now is about 50 years old. We’ve got to find a way to attract more drivers to the industry.”
Bill Graves, chief executive of the American Trucking Association, says the difficulty finding drivers has become the chief concern of trucking companies, even ahead of the cost of fuel.
”Issues like fuel prices come and go, but the driver shortage has sort of become a constant drumbeat,” Graves said. ”Fleet operators listed the driver shortage as their number one concern.”
Once a headache mostly for large national truckload companies, the problem now hampers the small trucking companies that make up most of the industry’s employers.
Driver turnover rates exceeded 100 percent for both large and small truckload carriers in the third quarter of 2006, according to an industry survey. Small-truckload firms, whose annual revenues are less than $30 million, reported 100 percent turnover rates for the past four quarters. That was the first time that had happened since the ATA began tracking the data in 1995.
”They create incentives for new drivers through sign-on bonuses, but those drivers quickly move on to another company that’s offering the same thing,” said Wagner, whose company provides warehousing and distribution services in several cities. ”The industry is not creating a stable, permanent work force.”
The causes of the shortage are numerous. Although there is a need for more drivers, their pay has not kept pace with other industries where working conditions are better. With lots of little companies, shipping rates have been very competitive, keeping pay for long-haul drivers stagnant this decade.
”I’ve had one business owner tell me he’s been shipping at the same cost for 20 years,” said Robert Merrell, who has been driving his own truck out of Liberty, Mo., for eight years. ”How are you going to make any money in a case like that? Fuel prices are going up, and the cost to maintain your equipment is going up. Everything’s going up except what drivers are getting paid.”
The industry measures its wages against construction because people who consider truck driving are often the same ones who take construction jobs.
In the 1990s, pay for long-distance truck drivers in the United States consistently was 6 percent to 7 percent higher than that of construction workers, according to a study by the ATA done with the consulting firm Global Insight. But with a flourishing construction industry, that differential disappeared. By 2004, the average weekly pay for long-haul truckers in the United States was $725, compared with $736 for construction workers.
”Construction jobs have provided a viable alternative to truck driving over the past four years since housing construction remained one of the steadying forces of the economy during the recession and the ‘jobless’ recovery of 2002-2003,” the study said.
Couple lower wages with the lifestyle a long-haul driver has to endure and it’s not surprising that fewer people are becoming drivers, said Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association in Grain Valley, Mo.
”Drivers are expected to be away from home three weeks at a time, and they basically live in their truck,” Spencer said. ”They’re only paid for the miles they drive, but they may end up working 70 to 90 hours a week when you count the time they wait on the loading docks. Unless something comes along to change the compensation approach to this business, there are going to be driver shortages.”
The squeeze has not been universal. In 2006, the driver work force was more stable for American Central Transport than the previous year, said Tom Kretsinger Jr., president of the Liberty long-haul truckload carrier.
But the company distinguishes itself by offering more specialized services to clients, hiring more experienced drivers and paying them $45,000 to $55,000 a year. And over the years, American Central has had to invest in more of its own trucks.
”It used to be the majority of our drivers were owner-operators,” Kretsinger said. ”But the cost of being an owner-operator gets higher and higher every year, with the cost of equipment, fuel prices, insurance and so forth.”
Haulers including Kansas-based YRC Worldwide Inc., whose units are mostly unionized and handle less-than-truckload deliveries, also have not been affected as much. The turnover rate for the mostly unionized less-than-truckload sector was 14 percent in the third quarter of 2006, according to the ATA survey. But it is a much smaller percentage of the trucking industry.
”I think the biggest difference is in the benefits,” said Bill Zollars, YRC chairman and chief executive. ”It’s also a quality-of-life issue. In our business, you don’t normally have drivers away from home for three weeks at a time. They have a set schedule that lets them know when they’re going to be home.”
The level of wages, the investment required and the lonely lifestyle make it unlikely that large numbers of recently unemployed, like the nearly 75,000 General Motors and Ford Motor Co. hourly workers who have taken early retirement and buyouts, can be drawn in.
The trucking association is exploring how to attract more minorities and women as drivers and is lobbying to make it easier for veterans to attend truck driving school through accelerated benefits from the GI Bill.
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