America is facing a massive shortage in truck drivers in the coming years, with recent research from the American Trucking Associations (ATA) indicating that a wave of retirements in the workforce over the course of a decade could hit the industry hard.
Demand for truck drivers, as well as turnover in the industry, each continue to be issues, according to an ATA press release, and the organization fears that by by 2024, the truck driver shortage may grow to 175,000. Right now, the sector is short close to 48,000 drivers. And while the trucking industry certainly needs to hire, it seems there is an issue with the quality of drivers, making it even more difficult to fill the growing hole in the workforce.
"An important thing we learned in this analysis is that this isn't strictly a numbers problem, it is a quality problem too," Bob Costello, the ATA's chief economist, said. "Fleets consistently report receiving applications for open positions, but that many of those candidates do not meet the criteria to be hired. According our research, 88 percent of carriers said most applicants are not qualified."
Driver turnover rate remains a concern
As the industry looks to prevent its workforce shortage from growing too large, its turnover rate remains high, although in the second quarter of 2015 it dropped below the recent average, a separate ATA press release explained. Turnover at large truckload fleets increased 3 percentage points to 87 percent quarter-over-quarter. However, during the same period last year, the turnover rate for these fleets stood at 96 percent, according to the Journal of Commerce (JOC). Meanwhile, for smaller truckload fleets – those with less than $30 million in revenue – turnover fell seven points to 76 percent. One year ago, smaller carriers had a turnover rate of 94 percent.
Costello noted that the still-high turnover rate for truck drivers is a sign of the competitive market for qualified individuals. Carriers often worry about the availability of qualified drivers, he said. Still, turnover at large fleets is at its lowest point since the second quarter of 2011. He warned that even though turnover isn't at historic highs, it is still worrisome. The industry will have to hire at a rate of 89,000 drivers per year to keep up with retirements and forecasted growth.
One of the most significant problems regarding workforce that truckload fleets face is the fact that many drivers are approaching retirement age. The median age for over-the-road drivers is 49, according to the ATA – seven years older than that of the general U.S. workforce. As carriers watch their drivers leave due to retirement, they will have to make an extra effort to fill those gaps with qualified drivers. However, strict requirements make those individuals difficult to find.
Carrier fleets have trouble finding qualified drivers
A truckload fleet that receives hundreds of applications in a week may only be able to hire dozens as drivers, the JOC reported. Drivers are required to be accident-free, drug-free and have several years of driving experience, which limits who carrier fleets can hire. Insurance costs and legal liabilities also make it difficult to hire qualified drivers. However, Costello believes that though there are challenges ahead for the trucking industry, they are not impossible to overcome.
"Our work shows the great and growing need for drivers," he explained. "But we also highlight several solutions including increasing driver pay, getting drivers more time at home, as well as improving the image of the driver and their treatment by all companies in the supply chain. Make no mistake, the driver shortage is a challenge, but it is not an insurmountable one."
Though there are difficult workforce obstacles ahead, if truckload fleets are able to take steps in the right direction, they may be able to hire themselves out of the shortage quagmire the industry finds itself in.