While we have had our attention on ag transportation difficulties at railroads and at ocean ports, several issues also have been developing for over-the-road trucks and drivers.
In October of 2014, Bob Costello, chief economist and senior vice president of the American Trucking Associations (ATA) told the attendees at ATA’s management conference, “The one dark cloud is a driver shortage that is “as bad as ever and is expected to get worse in the near term.”
In an April 1 press release on the ATA’s website, Costello said, “Due to growing freight volumes, regulatory pressures and normal attrition, we expect the problem to get worse in the near term as the industry works to find solutions to the shortage.”
Costello said one of the reasons for the shortage is demographics; the average age of a truck driver is 49 years old vs. an average of 42 years old for all U.S. workers. Another reason is the gender issue; the average number of women employed in the U.S. is 47% while only 6% of truck drivers are women. He also said getting a commercial drivers license is expensive and not easy, and while trucking companies reimburse the expense, many pay it back in installments. Pay has been an ongoing issue and many trucking companies are now offering driver bonuses to entice workers. “Even with pay increases, we are still having trouble attracting people,” said Costello.
A driver shortage makes it “difficult to add capacity” and it “increases operational hardships by costing freight delays,” Costello said. Here is a link to his interview posted on the ATA website.
HireRight, a leading provider of online background checks, drug and health screenings, and employment eligibility verifications released their annual 2015 Transportation Spotlight. The report also addresses the problems plaguing the trucking industry. “The ATA estimates that the current driver shortage tops 35,000 driver candidates; and an additional 240,000 new truck drivers will be needed by 2023,” noted the report.
“While there are a multitude of reasons, the top three reasons why drivers leave an organization remain fairly consistent from year-to-year; to make more money (49% in 2015 vs. 51% in 2014); to spend more time at home (40% in 2015 vs. 41% in 2014); and to receive better benefits(32% in 2015 vs. 27% in 2014). Almost a quarter (24%) of respondents reported health issues as being a reason for driver turnover. Life on the road is an extremely physically demanding occupation. The average life expectancy of a trucker is less than that of the general public. As the workforce continues to age, regulatory agencies will continue to scrutinize the health of drivers.” Here is the link to download the entire report.
MORE REGULATIONS ADD TO THE SHORTAGE
On November 28, 2014, the Federal Motor Carrier Safety Administration (FMCSA) announced “it is considering a rulemaking that would increase the minimum levels of financial responsibility for motor carriers, including liability coverage for bodily injury or property damage; establish financial responsibility requirements for passenger carrier brokers; implement financial responsibility requirements for brokers and freight forwarders, and revise existing rules concerning self-insurance and trip insurance. FMCSA asked for public comments on these topics that were due February 26, 2015.” Here is a link to the announcement.
The National Grain and Feed Association (NGFA) responded and said it “values FMCSA’s efforts to promote safety on the roadways and supports efforts to keep drivers of commercial motor vehicles operating safely.” However, it said, “While safe operation of commercial motor vehicles is in everyone’s best interest for myriad reasons, the FMCSA proposal to increase the minimum levels of financial responsibility for motor carriers raises questions as to how this proposal would achieve that objective.”
NGFA urged the FMCSA to forgo issuing such a proposed rule, or “at the very least, evaluate the impacts of additional premium costs on commercial freight transportation” before doing so.
Others support the proposed rule; Joan Claybrook, chair of Citizens for Reliable and Safe Highways, posted this comment on the FMCSA website: “Congress recognized in the Motor Carrier Act of 1980 that minimum insurance requirements encourage safe operations by carriers but the incentive provided by this mandate is seriously diluted if the requirements are grossly outdated.
With updated substantial minimum insurance requirements that reflect the current realities of the industry, risky carriers will seek to avoid serious crashes instead of simply treating such tragic events as nothing more than the cost of doing business. As such, I support raising the minimum levels of financial responsibility for motor carriers.” Here is link to view the 2,179 comments received by the FMCSA: http://goo.gl/…
Another pending FMCSA mandate is the rule mandating the use of electronic logging devices. According to the FMCSA, “The proposed rule will ultimately reduce hours-of-service violations by making it more difficult for drivers to misrepresent their time on logbooks and avoid detection by FMCSA and law enforcement personnel. Analysis shows it will also help reduce crashes by fatigued drivers and prevent approximately 20 fatalities and 434 injuries each year for an annual safety benefit of $394.8 million.”
“ATA supports FMCSA’s efforts to mandate these devices in commercial vehicles as a way to improve safety and compliance in the trucking industry and to level the playing field with thousands for fleets that have already voluntarily moved to this technology,” said ATA President and CEO Bill Graves.
However, many owner-operators aren’t in agreement and say they are concerned over costs, privacy and how the data will be stored. The proposal by the FMCSA is expected to cost the industry $1.6 billion, which could cause an increase in rates and become a financial burden for smaller motor carriers.
The final ruling for implementation of electronic devices is expected to be issued by the end of 2015 and implemented by 2017.