Capacity is slowly increasing
Capacity is gradually improving as small fleets become adjusted to electronic logging device (ELD) requirements and Hours of Service rules. The introduction of ELD requirements reportedly resulted in some older drivers leaving the industry rather than conforming to the changes. Driver recruitment has been aided by driver pay increases, although driver turnover remains high, especially for larger fleets.
The average U.S. truckdriver is 49 years old, seven years older than the overall average worker age. The average salary is about $70,000, and there is a shortfall of about 63,000 drivers across the country. And of the hundreds of thousands of trucking jobs created in recent years, a large majority of them--at greater than a two to one ratio--are in fleets of 100 or fewer trucks. Most are aligning with fleets of six trucks or less.
“I’ve been talking about the driver shortage for almost 30 years,” Smyrlis said recently at the Canadian Logistics Conference in Vancouver BC. “One of the very first stories I ever wrote was about the driver shortage. After 30 years I think we can be confident in saying that we are not going to solve it, at least not in the way we have been trying to solve it.”
He questions whether we are putting our recruitment efforts in the right areas. In Canada, 32.5% of drivers are recent immigrants, with people of South Asian descent dominating that sector. Effectiveness in reaching out to this population would be aided by utilizing Punjabi or Hindi language platforms.
Smyrlis also pointed out the gender inequity of the driver base. “97% of truck drivers are male. Yet 49% of the working population is female. Does it make sense to continue on a path where we don’t consider half the population (as part of the job candidate pool)? Can we really say we have a driver shortage when we don’t even attract half of the working population?”
Capacity is also being helped by the influx of new truck investment. New trucks have greater uptime, which can translate into 4% greater availability for service. Smyrlis cautioned, however, that new equipment investment isn’t so much to expand the fleet size but to retire older equipment.
“Around 75% of Canadian trucking executives are saying they are ordering new equipment for 2019 but it is replacing aging equipment in their fleet,” he commented. “In fact, if you look at the size of major fleets in the U.S., they are actually shrinking. They are getting smaller. The smaller U.S. fleets are getting larger, but they still don’t have the capacity to counterbalance what the large guys have (lost).”
And in spite of cost and availability pressures, the issue of truck detention remains a significant issue. According to survey results, only 16% said they would always collect a truck detention fee. Another 42% said they would rarely collect a detention fee if their trucks were held up and almost a quarter said ‘never.’
“It is pretty sobering that they (carriers) have to absorb those kinds of inefficiencies to their system,” Smyrlis said. “Even more concerning was the fact that they were not only absorbing that kind of inefficiency, but they were also doing absolutely nothing about it.”
Spot market rates declined in November for dry van and flatbed equipment, while rates rose for refrigerated van trailers in advance of Thanksgiving, according to DAT Solutions, which maintains a rates database of $57 billion in annual market transactions.
DECEMBER 2018