Some thoughts on the Driver Shortage Issue

Over the past weeks I had the opportunity to speak with some of North America’s leading truckers. Other than the “head shots” in this year’s National Hockey League playoffs, the other number one topic of discussion on everyone’s mind is the issue of driver shortages. I also had an opportunity to read what the Canadian Trucking Alliance labels “a new, eye-opening report” from the Blue Ribbon Task Force they established in 2011 to address the impending shortage of qualified commercial drivers in Canada.
In this blog, I would like share a few thoughts on this hot topic.
The problem is realThere are some shippers who believe that this issue is manufactured by the trucking industry to help sell freight rate increases. Let me assure my shipper friends that this is not correct. Trucking companies all over North America are having difficulty attracting “qualified drivers.” By this term we mean skilled professional drivers or people interested in becoming professionals.
This shortage is being created by an aging workforce, lifestyle issues (e.g. having to spend time away from home), a lack of interest from women, the challenges of the work, the level and structure of the compensation and the fact that driving truck is not viewed as a profession. The fact is that while there are millions of Americans and Canadians out of work, driving truck is not considered an option for most people.
There is no “quick fix”This problem is going to be with us for a while. It is going to begin having a significant impact on truckers that don’t craft a well thought out driver recruitment strategy. They are going to begin losing business to those companies that have drivers.
It is also going to begin having a more significant impact on shippers. Some companies are going to have problems moving their freight. They are going to have trouble finding carriers with capacity. They are going to have to switch from truckload to LTL or begin paying more. Get used to it and begin expanding your carrier base to minimize the impact of the problem.
What will it take to solve the problem?Take responsibility for solving the problem
The Task Force prides itself on the fact that truckers are taking ownership of the problem. According to the report, “industry leaders need to make a strong statement demonstrating to current and future drivers that we are serious about coming to grips with the issues that underpin the driver shortage.” The CTA report sends a loud message that the leading trucking organization in Canada has a sincere concern and is seeking solutions to the problem.
Create a Recruiting StrategyThis responsibility falls on governments and trucking companies to solve. Governments need to develop immigration policies to encourage skilled drivers or those individuals seeking a driving career to come to North America. The CTHRC and other governmental bodies are working on this. Trucking companies also need to craft strategies to secure the type and number of drivers best suited to the needs of their organization. This varies from company to company.
Address the Lifestyle IssueTruckers need to look at making the profession more attractive. This includes looking at how to create more turns and relays so drivers can be home at night and have better quality of life. Increasing the use of intermodal service for long haul movements also has to be part of the solution. Dispatcher training is critical to ensure drivers are treated with dignity and respect.
Make Truck Driving a recognized ProfessionThis will take collaboration between government, carriers and shippers. There needs to be a universally recognized truck driver certification program. The program will need to address safe driving skills, interpersonal skills, making effective use of computers and communications, diet, exercise, personal and lifestyle management. This will create a pool of professionally trained safe drivers. Trucking companies need to invest in these programs and shippers will need to seek out companies that employ professionally trained and certified drivers.
Start Building Capacity nowAlmost every trucker is singing the same song these days. We will replace our fleet but not make any additions for growth until there is a demonstrated upswing in the economy. This is a direct result of the impact of the Great Recession that caused many truckers to park equipment.
The CTA report concedes there is merit – at least in the short-term — in the argument that a driver shortage is good for the industry in that it creates tightness in capacity which in turn places upward pressure on freight rates. Obviously the “industry” referenced in the quote is the trucking industry and not shippers or the economy.
The market is going to take care of this problem in the years ahead. As the economy improves, there will be increased demand for trucking services. Shippers will gravitate to carriers that invest in their fleet and drivers. Carriers that are trying to harvest their current fleet and not make the necessary investments will lose customers and be left behind. This is what will drive carriers to move from their current yield optimization strategies. More carriers need to begin planning their growth strategy now for both equipment and drivers.
Make CSA a North American Program While some argue that the CSA program in the United States (that applies to drivers who cross the U.S. border as well) is a cause of the driver shortage, the fact is that this program, that is in the process of being refined, elevates the quality of the profession and weeds out substandard trucking companies that do not put a proper priority on safety. Long term, this is a good program for the trucking industry. The CSA program needs to become a North American program and needs to be refined over time to maximize its effectiveness.
Create Best Practice Driver Compensation ProgramsDuring my discussions with truckers this past week, I heard a number of proposals on how to improve driver compensation. These range from paying drivers an hourly wage rather than rate per mile to tying incentive pay to the achievement of various metrics (e.g. stops per hour, safety record, etc.). Improving compensation is clearly part of the solution.
Shipper support for Carriers employing Professional DriversTruckers must focus on making their operations as productive as possible. This includes using the most advanced TMS systems linked to the most cost effective tractor and trailer tracking. In other words, truckers have a responsibility to run the most efficient operations possible. Shippers don’t have to pay for the inefficiencies of their carriers.
People who are potential truck drivers have career options. They can go into construction or a host of other jobs. Driver compensation will have to keep pace with remuneration in other professions.
Freight rate increases should go to those carriers that are the most efficient and can demonstrate how these increases are tied to investments in making their operation even more efficient.
Shippers must be part of the solution to the driver shortage problem. There is a cost associated with recruiting, training and compensating professional drivers. Shippers will likely continue to have the choice between using lower quality carriers that have inefficient systems and don’t train and pay their drivers well to companies that use carriers that provide a high quality service, utilize the best technology and the most skilled drivers. The latter will likely come at a premium.
SummaryCarriers need to plan now to ensure they have the fleet capacity, drivers and technology to run a productive and efficient operation. Otherwise, they risk being left behind. Shippers need to understand that the driver shortage problem is real and that they are part of the solution. Part of the solution is selecting carriers that invest in technology, equipment and professional drivers.

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Dan Goodwill, President, Dan Goodwill & Associates Inc. has over 30 years of experience in the logistics and transportation industries in both Canada and the United States. Dan has held executive level positions in the industry including President of Yellow Transportation’s Canada division, President of Clarke Logistics (Canada’s largest Intermodal Marketing Company), General Manager of the Railfast division of TNT and Vice President, Sales & Marketing, TNT Overland Express.

Goodwill is currently a consultant to manufacturers and distributors, helping them improve their transportation processes and save millions of dollars in freight spend. Mr. Goodwill also provides consulting services to transportation and logistics organizations to help them improve their profitability.

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  • More money is required to motivate me,,,been trucking over 30 years and I will be damned if I will work over 44 hours in a week. If the guy on the dock gets time and a half after 44 hours and the guy on the dock at my destination gets time and a half for working over 44 hours what is wrong with offering me a 50% premium on my mileage rate after 44 hours…Highway truck drivers are compensated the same as seasonal sharecroppers….NO OVERTIME PAY regardless of how many hours we work…Truck drivers who work excess are arre being played the fools

  • If there is a “driver shortage” why are truckers today working for about half the money they made twenty years ago in real measured terms?
    The rules of economics always apply.
    If there was a shortage of anything then prices relative to demand would go up.
    That has not happened in the trucking industry.
    It is my opinion that there is no truck driver shortage.
    This is largely a fiction created by carriers who still treat their drivers as totally disposable.
    What there is however is a shortage of people willing to work at half the money they used to make.

  • The driver shortage is a myth! Plain and simple. If this alleged shortage was true then freight would be stacked up @ dock doors! If it was true CEO’s of major manufacturers would be on the front page of the Globe and Mail business section bemoaning the fact that they can’t get their product to market. If the alleged driver shortage was true then the value of drivers would have shot up as would their remuneration just like the value of corn and soybeans!
    What fleets suffer from is driver churn due to the low driver pay and poor driver treatment. If carriers would solve (they know how to do it) their HR problems and stop the revolving door then their problems would go away.
    Driver shortage my ass!

  • Comments
    Ask James if he knows how much Sleemans budgets for recruitment.
    I seem to remember almost no driver turnover, hmmm.. Why not
    follow a winning formula ?
    Posted by: meslippery | September 6, 2010 04:41 AM
    Meslippery, really, private fleets who never have to worry about profitable trucks because the double digit margins on their beer makes trucking fun, how do you compare private fleets to for hires, makes no sense!
    Posted by: Ray Haight | September 7, 2010 05:11 PM
    You see No shortage just pay.

  • I read somewhere that less than one third of licensed drivers in Canada(class 1 or equivalent) are actually driving truck for a living! I can’t remember where it was written, but if that is true, then there is definitely no shortage of drivers….just a shortage of pay to put up with all the unneccesary policy/procedure and poor treatment of truck drivers!

  • To Stephen Large.
    I can tell you where you read the statistic on how a full third of people in Canada who hold a Class One license are no longer working in the trucking industry.
    Several years ago Canadian journalist Eleanor Beaton published a hugely impressive article in the now defunct HighwayStar Magazine entitled “Unsolved Mystery”.
    This was around 2004.
    In the article she said that this truck driver shortage was largely a myth because there were something like 680,000 people in Canada who hold a Class One license, but only about 65% of these people work in trucking, having left the industry due to poor pay for other careers.
    The other statistic she cited was that almost 60% of people who take up trucking leave the industry within one year.
    I remember once I had a meeting with the president of a trucking company who asked me why I did not want to consider driving as a career.
    I cited two sources, the first being the article just mentioned.
    The second source I cited was the book “Sweatshops on Wheels” by Michael H. Belzer, link cited below:
    I highly recommend this book. Can be ordered on the Amazon Canada website or maybe at your local library. Note the comments on the book at this link.

  • Thanks John H! I remember reading that too….about half a dozen years back, but I read it again within the last year or so and it was reported much worse than the story you have mentioned. I know that even in the small community where I live, there is definitely way less than half of the people with the proper license that are actually driving truck for a living! I can always get somebody to drive for me for $30.00/hr if it is local work, but as soon as it involves long hauls and log books and the potential for unneccesary roadside hassle from the DOT, then even for $50.00/hr, most guys WILL NOT DO IT! After 28 years of it, I am VERY close to that point also! However, most of those guys who will not put up with the BS involved in driving truck will gladly run my grader, loader, excavator, etc., for less money!

  • More immigration? Are you for real? Have you been to Brampton, ON lately? Tell me there’s a driver shortage there. As long as the Brampton Bandits are working for $8/hr, why on earth would any shipper pay higher freight rates to help drivers?
    The very real solution to this is insurance rates so high, and licensing so hard to get, that the dead skin of the industry will finally be shed, and let the healing begin. Check out the link bellow, and be sure to watch the video.

  • That Blue Ribbon report.
    10 pages? Must have been paid by the page.
    Said the same thing over and over.

  • I too agree with John H and Michael Gower, there is no driver shortage only a shortage of companies willing to compensate their drivers properly.
    I remember working for Tom Brooke at Baird/Air Ride back in 1990 and company highway drivers were paid overtime for all of their miles after they had reached 2200 miles and/or X number of hours logged on duty while delivering or loading.
    Of course, all time spent loading, unloading, fueling, customs or doing pre-trips was also paid hourly too and that too was subject to overtime rates as well.
    Drivers there were actually treated with respect.
    I’m fortunate to have found the same level of respect with my current employer but these types of jobs where drivers are compensated properly are indeed rare.
    Until carriers wake up and pay in the same manner, nothing will change and I fully expect that all this ‘talk’ of change is more of the OTA and CTA blowing smoke up the drivers asses as they have been doing for years.

  • So it seems to me you have a consensus based on the comments readers have posted to your article. The issue is not a driver shortage but a compensation gap issue. You have enough people with their AZ license (I have mine), just not enough who in turn are willing to work for these sweatshop style per mile plans that do not pay for other hours of activity that are totally work related and benefit the carrier and shipper. No one likes to be exploited, it does not matter what industry they are in. I agree with the comment that what we are seeing instead is a conscious decision by carriers to pursue a churn and burn strategy with drivers. The evidence is there in the brutal compensation plans.

  • To compensate drivers properly, freight rates need to increase. When you propose freight rate increases, you stand a chance of loosing customers. I feel the answer lies in providing superior service for customers that pay adequately & refusing service to those that don’t.

  • If there is indeed a shortage, I have a question for you then. I have my class 1 and I loved to drive. I even went through the Earn your Wheels program in winter so I would have a clue of what I was doing. I wanted to be a safe driver. However, I had to stop driving about 5 years ago due to health problems.
    Recently, I wanted to get back on the road and went to the open house of a national carrier. What I got was, even though I had experience (admittedly not much) and was more than willing to return to “school” (one that they work with and hire from) and refresh my skills, was “Come and see us when you have a recent year under your belt”. When I mentioned that I would be willing go back and upgrade my skills, I was told that they were only interested in new drivers going through the Earn your Wheels program.
    This is the same crap I got when I got, and never did use, my class 3.
    Yes, I could go work for a crap outfit – god knows we have enough of them on the west coast – but I have done that in other driving areas and I don’t want to go through that bull again. If it is not a good company, I don’t want to work for you but the good companies don’t seem to want me.
    Can you tell that I am frustrated!
    This has now happened to me twice and I am at the point of giving up on driving a decent sized truck. I know that 2 times is nothing but when I see the same pattern as before, I wonder if I should waste my time banging my head against doors that don’t want to be opened.
    I will keep on trying but you can’t tell me there is a shortage or that we need to bring in more immigrants.

  • So many good comments and ways to TRY and fix the trucking industry. Guess what folks all these ideas only repackage the problems. I can suggest a FIX that would make the trucking companies and shippers cringe and the driver happier. Here goes. All drivers who do trips of more than One day (away from home more than one day) should be paid by the hour, i would say approx. $15.00 ($14.00 min.) per hour. That means from the time the driver parks his car at the home terminal and gets in his truck until he is hopping back in it to go home he is being paid. That also means paid for sleeping eating waiting etc.. Every day the driver is away should have two meals paid for eg. hand in a receipt for your meals and get compensated. That would allow the truck driver to eat better. would also create more of a need for truck stops. Build a truck stop creates more parking.

  • This driver shortage issue is a myth. This industry is not run by drivers it is run by bureacrats and accountants and polliticians that want to please the public with chicken little the sky is falling phoney issues and made in the office crisis. Nobody and I mean nobody who has driven a big car for a living for any length of time knows that besides the money issue there is a whole range off issues why the experianced drivers are leaving and the new drivers are hard to attract. Here is an equation even a first year accounting student can understand. No drivers No trucks on the road No rail no ship no hope no economy. This is so simple to solve if anybody was motivated to do it. but you would rather spend your money on usless teck that in most cases leads to more down time more lost revenue. You would prefer to recruit from each other same s#@&t different pile none off you can or will solve this problem because none of you are out here to see this problem. Keep sitting in your office , keep going to your rubber chicken dinners and your pat yourself on the back meetings while this business slowly slides into the dump. Its a partnership from all the facetts of this industry that can fix it but none of them are motivated to do it because there is no preassure on them to change the current system. I can guarantee you that if a ceo of one of these so called best to drive for fleets had to shell out 2100.00 dollars a year for a shower he would rethink how his fleet gets fuel from a no sevice card lock so his drivers could a least have that litte perk.Its not just money, although that is a big portion of the current driver discontent it is a the little pieces of the puzzel too. This industry needs to change and addapt to the driver not the other way arround or there will be no drivers and therefore no industry.Just so you know the shower figure is based on an aversge of 7.00 dolars per times 300 days

  • Sounds to me like the driver,s all have very valid points. # 1 should be pay. A long haul driver should not have to worry about his pay check going in the bank at the time it should. I drove for a carrier in N.B like that once and when i would call home on Pay day my wife would say no pay went in the bank. The companies excuse was the driver heading home to the Base terminal forgot the mileage envelopes and they would make it up when put your next miles in. That does not put food on the table or pay the mortgage. A lot of driver’s left very quickly. Companies would retain driver,s if they paid hourly with benefits and driver,s were paying into a pension. A company pension or profit sharing. The guys at the Container Terminals have a very nice pension after 20 years or so. The companies have enough expertise to set these things up. I am trying to re enter the trucking industry just to get to Alberta where there is real money to be made. Not stopping in Brampton Ont.

  • Reading the Help Wanted section of Vancouver Craiglist under Transportation and ran into this posting:
    Its time that all you Professional Class 1 Drivers stopped working for these trucking companies that refuse to pay a decent wage. Why is it that I made more money 15 years ago than what you are making now? Why are you driving for a poor wage, not getting paid wait/work time and sitting in your cab away from your loved ones while dispatch is trying to find you a load? Perhaps they should have had that load booked before they sent you out. I am not going to blame anyone except ourselves for allowing this to happen. When BC deregulated the trucking industry many years ago they allowed the bottom feeder and scammers to get into a industry that had until then paid decent wages and attracted hard working men who were not ashamed to be truckers. The last time I was on the road I was dismayed at the lack of courtesy I saw, the poor driving skills (hey learn how to chain-up before you head out on the roads in the winter) the litter on the ground at every brake check and the unsafe driving that was apparent far too often. Its simply too easy to get a Class 1 in this Province and as a result we have degraded our industry to such an extent that I doubt very much if we can ever regain what we once had. Of course there are some great companies still out there with their very professional drivers but they are far and few between and its time for a change. I hope the CVSA Inspectors and the RCMP crack down on all the junk I still see on the roads and ticket all the drivers that want to drive like idiots.
    In closing I hope that none of you reply to mystery ads and refuse to send your personal info and abstracts to those kinds of posts. To all you real pros out there I have nothing but respect for you and hope you stay safe among all the fools you are forced to share the road with.

  • I have gone thru a long list of very unqualified licensed drivers and paid the repairs. Our company would love to take trainees in a truck and teach them to be professional drivers. Depending on the trainee that could be anywhere from 3 to 6 months. Our problem is that at today’s freight rates, we cannot pay them for what would essentially be single miles or at best super single miles. Now if the government were serious about training drivers, they would work with carriers to pay trainees thru their “on the job training”. Instead they send them thru a school course, which gets them their license, but a license does not make a professional driver. Only training and experience can do that. The ei training course is such a waste of money. I have received numerous calls from newly trained people. I ask-have you ever loaded a load, have you ever backed down a back lane, have you ever blindsided into a dock, have you ever been on black ice, have you ever figured out the weight distribution for a load, have you ever navigated thru the “golden triangle” in rush hour with 45000 lbs in the box, have you ever run in the mountains and the answer is always no. So where are the professional drivers that our government is wasting so much money training????

  • !. Truckers need more pay for what they do all waiting times everything they do on duty..
    2. Companies stop lying to truckers about the mileage and what is included and home time
    3. Companies start charging their customers for all waiting times and give it to the truckers
    4. Rules and regulations on DOT and the insurance companies make it next to impossible to be a trucker period.
    5. All equipment on level inspections on scales should be deemed by company fault and should be billed to them and all truckers caught for over their hours become company fault they should pay for it as they are the ones pushing the trucker and the company is liable for their own equipment and maintenance, why is the trucker footing the bill for a company.
    6. Dispatchers should be gagged and tagged they are abusive and have no clue they only care the trucker kills themselves to get loads there on time..
    7.Sitting time on truckers is horrendous on loading docks and waiting for loads. Truckers lose out if they do not roll and when they do finally get loaded they have to make up for loss time and then it becomes a safety issue.
    8.Freight moves 24/7 no need for a trucker to be sitting and the fact these companies make boatloads of money off the truckers back on loads.. even when they take all the overhead out the trucker gets paid less.
    9. Start off with regulating truckers pay like any other job and enforce the rules to the companies to shell out more and if there is a shortage of truckers because companies refuse to pay what a trucker is worth and the garbage they have to put up with for what pay is deemed close to under minimum wage when worked out. If cost of living goes up so does cost of freight yet truckers are not seeing their wages compensated for that. It is corporate greed and profit
    10. Trucker underpaid and under appreciated. No wonder why no one wants the job and it is one of the top jobs that need so many bodies to fill the seats and to haul freight..
    Simple it boils down to economics 101 cost goes up, so does inflation..If wages do not meet the rise in cost or inflation then no one wants the job because it is not worth it…Companies want to treat and keep their drivers start treating them right and up the ante.. The bigger companies will end up taking all and the small ones will die off and it is never a good thing when monopoly comes into play it gets worst for the trucker’s situation and there will never be changes to benefit the trucker and consumers will also have to pay the price..Trucking has not evolved in any sense but one technology and that is all time for the trucker to evolve when it comes down to pay and how they are treated. DOT and insurance companies would have not implied so many rules and regulations if they looked top most at what the trucking companies are doing and implement the changes where it counts..

  • It is the insurance that causes the lack of drivers also.. They now have pilot programmes for trainee drivers for big companies that hop aboard these programmes then they get hired on by these big companies and get paid even less then minimum wage for a 2 year contract or they have to pay some of it back.. It totally is a big scam on both the company and the insurance.. They pat each others backs.. The companies who join the programe probably gets good discount rates for their insurance while the company gets slave drivers.. It never benefits the one who got into the training.. If you choose to shell out for your class 1 out of your own pocket it is catch twenty you have a class one however no one will hire you without the experience because of the restrictions on the insurance companies.. It is laughable and every company you call insist you come back to them though when you have enough experience.. So the insurers tie the hands of any new driver unless they go on a training programme with a big company who uses and abuses you because you need the experience..freight rates have to come up and driver’s pay have to come up with them only way to balance out and companies need to understand if they want drivers they will have to put out from their bottom line even if it means getting less profit.. The more you keep a happy driver, the more work you will get out of them and the more the company will profit, as well as the driver..

  • I am well educated and well versed in trucking.
    I put myself thru college and university doing so.
    The problem in trucking is office staff(bureaucrats) think “us” truckers are stupid.
    Pay is terrible.
    Once your week starts your owned.
    They work you to government limits which were put in place for security and
    to make sure you get proper rest…..yet dissect this to find every loop hole
    to work you and no care that life is “hell”!
    Then don’t forget….only 36 hours off and no pay for all that wait time during the week
    and loads of other wasted non-paying hours.
    Qualified drivers are leaving and new drivers quitting.
    Foreighners will figure the same and this just puts off the inevitable which
    is treating people right.
    Organize your damn shipments and give truckers a fair work day(in daylight hours
    after a proper sleep) pay us a fair wage and this includes wasted time and over time
    after 44 hours. Oh hell… about hourly????
    We need a truckers group in Canada so that the drivers get their fair say.