While the country shut down for the pandemic, the trucking industry shined. The current market was the light at the end of the tunnel: high volume, high rates and increased compensation for drivers.
The stars have seemed to align for the average long-haul driver, but ironically, trucking companies are having difficulty locking down new drivers.
In a recent Randall-Reilly study, truck driver job postings in 2020 rose by more than 300,000, but job seekers rose by only 70,000.
In the report, 33% of drivers said their top concern was paying their bills, while 68% agreed that they were not paid enough. Nationwide carriers like Knight-Swift, Cheema Freightlines and Forward Air have listened and recently raised pay for drivers.
Yet employment data from the Bureau of Labor Statistics shows after the dramatic decrease prior to the pandemic, trucking companies have not been able to increase their driver labor force back to pre-COVID highs.
Recent unemployment data showing that individuals are going back to work raises the question: Where did these truck drivers go?
The response might be as simple as two words:
Final mile.
Long-haul drawbacks
With regard to over-the-road trucking, drivers have found many issues that go beyond driver pay. According to the Randall-Reilly study, the following are among reasons why drivers would consider changing jobs and driving for another fleet:
- 21% want to choose their routes and hauls.
- 14% want more time at home.
- 6% want a clear career path.
On the subject of one thing that could attract and retain drivers:
- 18% want guaranteed minimum pay.
- 11% want more regional hauls to come home more.
- 10% want a certain amount of home time each month.
Drivers are now realizing that final-mile delivery addresses these concerns. Expectations about its immense growth in the future make it even more appealing.
Final-mile delivery boom
According to McKinsey, e-commerce has experienced 10 years of expected growth in Q1 of 2020, with 60% of consumers expecting to integrate online shopping into their post-COVID lives. To keep up with this consumer demand, there will need to be an increase of final-mile drivers for on-time delivery.
Unfortunately for long-haul carriers, data suggest that qualified drivers are starting to make their moves toward this side of the industry.
There has been a significant increase in one section of labor over the past year: courier and messenger services.
The SONAR chart below shows a continuous rise in these services, including elevated highs for seasonal increases in demand. While most employment sectors in transportation have stayed relatively flat, final-mile employment has shown a continual increase over the past five years.
Final mile delivers answers
The final-mile transportation sector has a much lower barrier to entry than the typical medium- to heavy-duty truck driver faces.
In an interview with FreightWaves, David Olshansky, co-owner and chief operating officer of recruiting firm DriverSource, explained how the final mile is creating a new hurdle for recruitment.
“The Amazon effect is creating a shortage of drivers, and others like DoorDash and Grubhub are creating a new industry where drivers can make the same amount of income and they don’t have to get involved with DOT regulations,” he said.
Amazon, a leader in final-mile delivery, lists only a few requirements to become an Amazon Flex driver. This program allows drivers to use their own vehicles to deliver packages for the company, only requiring that its employees be 21 or older and have a valid driver’s license, a midsize or larger vehicle, and a smartphone.
Many other final-mile services limit their requirements to these few items, and some, like DoorDash, drop the age to 18.
These programs allow drivers to make their own schedules, control their pay and limit their exposure from increasing costs, including insurance, that many owner-operators deal with.
Historically, final-mile carriers pay lower premiums because of the nature of their business due to the familiarity of their routes in a specific area of operation.
“Insurance is absolutely killing [trucking] companies right now,” Olshansky explained. “I have heard quotes of $30,000 or $40,000 per truck per year for motor carrier insurance.”
The barrier to entry is higher because of the need to obtain a commercial driver’s license to become a long-haul driver of medium- and heavy-duty trucks. The following conditions must be met:
- Be able to safely operate a medium- to heavy-duty vehicle.
- Be physically qualified to drive a commercial vehicle under Federal Motor Carrier Safety Administration standards.
- Have a valid medical certificate, including a drug test, completed by a registered medical professional.
- Obtain a valid road test certificate.
Olshansky thinks issues on both ends of the driver age spectrum arise from these standards.
“I am a firm believer that there are a number of younger individuals that are not wanting to be a part of a drug-testing type of industry,” he said. “Also, [veteran] individuals are wanting to get out of the industry because of it.”
How recruiters are confronting these needs
Olshansky explained that instead of just raising pay for drivers, trucking companies need to invest in different areas of driver concerns.
“We have been telling a lot of our clients to focus on upgrading their equipment and doing what you can to have a driver home every night.” he said.
In an interview with FreightWaves, Scott Smith, chief executive officer and co-founder of P&S Transportation, described the same difficulties of competing with last-mile logistics jobs that often get drivers home every night.
Smith said this was the first time truck drivers are choosing local delivery routes over long hauls.
“We are mainly an over-the road company, and we struggle with work-life balance,” he said of maintaining his fleet of over 1,300 trucks, operating in 15 locations across the U.S.
Olshansky suggested considering a different fulfillment process for customers to help get drivers home more often.
“We will work with over-the-road companies in an effort to change their route structures to where we can have ‘home every day’ positions,” he said. “Having different relay points to help turn it into a ‘home every day’ position can help open up a pool of potential drivers.”
He emphasized that trucking companies will need to become much more strategic about driver recruitment in the future, and those reluctant to invest in these areas will continue to struggle with finding drivers.
“One thing is for sure: Companies that are not willing to change their way of thinking in this industry are going to be the companies that don’t make it in the long run,” he said. “There are many challenges coming from different fronts, and things are not going to get easier.”
Click here for more articles by Grace Sharkey.
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Eagle Eye
When reading this article I feel in my opinion I would like to which to a route that will get me home more often and longer. Being gone stresses you out have you more fatigued to you don’t want to come back out once your home. DOT regulations has it’s hands full with drivers failing drug test while the marijuana law is becoming legal in states.
Victoria
Why bother with driving a truck OTR when you can make more or the same amount money delivering for the above mentioned companies and be home every night. The industry has changed due to COVID. People that never or rarely ordered from Amazon or food delivery services found out they like it. They can stay home streaming more stuff to watch on their huge televisions. Why bother going out when just about everything can be delivered to your front door.
The hassles CDL drivers must deal with are nonexistent for delivery drivers. I’m not going to list them. If you drove or drive a big rig you know what they are.
The only thing I think is a drawback is there are probably no benefit packages for delivery drivers. My benefit package as a OTR driver was quite valuable. I made sure I got as much as I could out of it. I estimate that added approximately 400K through health benefits, 401K, legal plan and flex med. This does not include the amazing tax deductions.
Looking back on it, I’m glad I drove a big rig. I’m thankful I retired before all the automation on the trucks. I do not need a truck driving for me. I drove millions of safe miles without all that technology. Not to mention all the added DOT regulations and the lack of parking spaces that got worse with every year I drove.
Leslie Duke
It takes a damn fool to drive it’s pure hell now believe me I’ve been a trucker 49 years it was fun now I say fu.k all those laws that hurt the driver i sit my ass at home and love it no worries but you have a ton of trouble plus the back stabbing and people taking you money and at home your women lol I think you know and no respect from shippers don’t be stupid Lucky said that 10/4
Jeff Richter
I drove a Sprinter, expedited freight. 7mos i drove 96k miles through all lower 48, Mexico and 4 provinces in Canada. You don’t have DOT restrictions which allows you as a company driver to be abused royally. 800-1000 miles a day. I slept in a hammock. Supposed to get 33% but never allowed to see invoicing. I make the same driving a rig now, no more than 600 miles/day, casper mattress, microwave, Tv and frig and im home every weekend.
Frank B
I think it’s high time transportation professionals should be home every night. There is no more need of being gone for weeks or months and spending days with no pay in a truck stop spending money for food, showers and etc. Cross country freight can be relayed using drop and hook.
D. Stump
I always find it amazing when reading articles such as this that no one understands one of the most underlying problems the truck driver and the industry that employs the drivers face. As described by the drivers in this article irregardless company drivers or owner operators they have a shared need to the sales staff and brokers throughout the industry and vice versa. Until many of these Lane and sales practices including many weights and measures practices are changed from the archaic ways of doing business the sales staff’s and brokerage firms will always outsell the abilities of the drivers to move the tonnage it’s a simple as that. I will leave the liability comments about insurance companies ambulance-chasing lawyers and litigators for another comment and another day.
Hunter
Not everyone wants more home time. My left a company that was going to more home time/regular routes/dedicated. I ride with my husband & love the open road. We get home when asked & yes we went to owner ops after a year as company with our current company. I have to say DOT laws are getting harder for over the road drivers. Alot of DOT rules are needed especially because trucks are a big responsible especially since more & more people think they are more important than truck drivers & cut you off etc.
So as I agree it’s hard recruiting drivers but it’s sad that so many can’t pass a drug test. That’s telling in itself how many people in america are reliant on some sort of stimulants.
Shane
Been in this business now 8 yrs.
Worked heavy industry prior 30 yrs.
Trucking is looked upon with scorn and contempt. Treated like a suspect while earning a living.
Every night into day I witness cars causing wrecks and near wrecks and yet I must prove my drug free life at every turn.
I am over regulated and so is the truck. Many reasons for this that doesn’t need to be.
Hunter
You are correct, my husband & I say every day people need to drive more defensively & laws need to be informed like cell phones etc
Heath Holdbrooks
Because your driving what is effectively a bomb. Average consumers are ignorant and unappreciative no doubt. Safe, unimpaired driving is measured for your company’s insurance. Thank you for what you do, the country cannot function without the truck driver.