Logistics help businesses navigate the trucking industry’s driver shortage
By: Phil Sneed
Many Americans are unaware of the driver shortage plaguing the nation's trucking industry, but it affects people's lives every day. According to the American Trucking Association lobby group, industry fleets are short approximately 25,000 drivers, and the problem will only become worse in the coming decades. This issue reverberates well beyond the narrow confines of small truck fleets, and impacts the lives of everyone who relies on the timely delivery of goods. Luckily for those who need consistent shipping options, logistics companies make it possible to circumvent many of the problems caused by the shortage.
An issue that leads to higher prices and delays
A huge problem in the industry is driver turnover, which has been alarmingly high since the early 2000s. The American Transportation Research Institute discovered the average turnover rate at large truckload carriers was 97 percent in the third quarter of 2014, and this presents an enormous cost for fleet owners. The numbers are slightly better for small truckload fleets, at 94 percent, but still represent an expensive problem that fleet owners have to cope with.
The issue is not simply turnover, but a shortage of young drivers in the field. The ATRI found almost 30 percent of truck drivers are between the ages of 45 and 54. That is a higher percentage than other industries. More problematically, only around 15 percent of truck drivers are between the ages of 25 and 34. That's considerably lower than the share of young people employed across other industries.
Together, these factors increase expenses and choke capacity, and the problem is likely to become worse.
A growing concern
Despite this shortage, an enormous number of businesses rely on trucking every day. The ATA reports 70 percent of the nation's freight tonnage gets transported by trucks. If your company is one of the many that works with individual carriers to ship goods across the U.S., Mexico or Canada, you have likely experienced higher prices, shipping delays and general uncertainty related to the driver shortage. Sadly these problems will increase in the coming years. By 2025, the ATA expects trucking freight tonnage to increase 23.5 percent. Unless there is a significant change in the driver shortage, this will exacerbate the current crunch.
Logistics companies limit the impact of the driver shortage on companies that need to move freight. If a company contracts with several different carriers, it opens itself up to a confusing web of communication and has to deal with inflated prices from every carrier it works with. A logistics company streamlines the process and can leverage longstanding relationships to deliver a single low price for shipping service. Additionally, logistics companies can coordinate intermodal transportation that dodges problems caused by the driver shortage by offload certain shipments to rail and other shipping modes.