Business

Truck drivers in short supply for the long haul

David Adolph likes driving for Midwest Transport Specialists in Kansas City, Kan., because, “They try to get me home on the weekends.”
David Adolph likes driving for Midwest Transport Specialists in Kansas City, Kan., because, “They try to get me home on the weekends.” The Kansas City Star

Pay raises. Signing bonuses. Productivity premiums. Calls from recruiters.

Remedies for a worsening truck driver shortage are popping up across the country. Most agree the freight industry will need to do more.

“The companies need to stop being so greedy and start paying the driver,” said James Hart, an over-the-road driver who had stopped for fuel in Oak Grove recently.

Some companies are responding to Hart’s complaint with their biggest pay raises ever. They’re trying to find the estimated 30,000 long-haul drivers that the American Trucking Association says we need on top of the 750,000 we have.

Experts say even larger pay bumps of 20 percent or even 50 percent are in order for the hardest jobs on the road, the long hauls that keep men and women drivers away from home for weeks. Trucking companies usually don’t disclose what they pay, but Bureau of Labor Statistics data indicate the average truck driver wage in 2013 was $40,940.

Other parts of the freight hauling industry feel the squeeze less directly but are taking steps, too. Less-than-truckload carrier YRC Freight of Overland Park, whose drivers tend to drive shorter hauls between company terminals, hired its first driver recruiter ever in January and is running a truck driver training school in Kansas City.

The driver shortfall is likely to grow — perhaps eight times greater.

New federal Hours of Service regulations have reduced the number of hours drivers can stay on the road, which means we need more drivers to handle the same amount of freight as before the rules changed.

Companies are losing experienced hands to retirement and to other industries that pay more or offer better working conditions. Too few new drivers are taking to the road to make up the difference.

Also, the economy’s recovery is driving up the demand to haul goods, materials, equipment and other freight.

Analysts say consumers shouldn’t worry about big price increases for goods hauled long distances. Transportation costs make up a small piece of most items’ price tags. But some of the cost of giving drivers a better deal may get passed along.

And the longer the driver shortage festers, the greater the odds grow that there will be spot disruptions in deliveries.

“We’re not at the point of crisis right now,” said Gordon Klemp, founder of the National Transportation Institute, a research firm. “But I think we’re starting to see the edge of the cliff. This is getting pretty tough.”

Rough roads

The heart of the driver shortage rests in the long haul side of the industry. But pretty much everyone’s reacting to the pinch one way or another.

In July, Swift Transportation Co. announced its biggest driver pay raise ever, though company officials weren’t saying how much that is. They are going to customers, including big retailers, and talking about the need for rate increases to help cover the drivers’ pay raises.

US Xpress Enterprises, a long-haul trucking company like Swift, does say how much its August pay increase was — 13 percent and the biggest in its 28-year history.

“The driver shortage is definitely real,” said Eric Fuller, chief operating officer of the privately owned company. “We’re just taking a leap to say this is where it needs to be for the future.”

At Con-way Truckload, Bert Johnson expects to see pay increases for long-haul drivers of 20 percent or more across the industry, though it may take several years to get there.

Industry observers estimate that the long-haul industry probably faces a 50 percent pay increase to address its driver problems.

Pay is only part of what’s changing. Companies also are trying to make the job less disruptive to family life.

David Adolph drives for Midwest Transport Specialists in Kansas City, Kan., though he figures he could make more money elsewhere.

“They try to get me home on the weekends, which is kind of nice,” he said near the end of return haul from Boston. “I like the people I work with there. They pretty much leave me alone.”

Long hauls aren’t as long as they used to be, either. The average last year was 532 miles, according to the American Trucking Associations, but that’s 30 percent shorter than in 2000.

Johnson, vice president of human resources at Con-way Truckload, said the company worked hard to ensure its drivers got home when their scheduled days home came around. The company also has a driver advocate and driver roundtable for feedback. And a 401(k) plan with company contributions, health care, and bonuses for drivers who meet performance goals.

Still, Johnson has to find new drivers to replace about 65 percent of his long-haul crew every year. And he brags about that. The industry average for long-haul work is 100 percent turnover, which means a company has to hire as many new drivers as it has every year just to avoid shrinking.

That means experienced drivers know they can find another job if they don’t like the one they have.

Long-haul companies aren’t the only ones hungry for drivers.

Federal Express recently had a billboard on Interstate 70 in Kansas City advertising for drivers. US Foods had one on U.S. 40.

Sign-on bonuses disappeared among trucking companies in 2009, but have come back. The National Transportation Institute’s research found a signing bonus on at least one job among 44 percent of the carriers it checked that were looking for drivers to pull normal trailers.

YRC Freight’s drivers, who are represented by the International Brotherhood of Teamsters, don’t spend weeks on the road. Unlike the long-haul drivers, they often drive familiar routes between YRC terminals and make it back the same night or spend only one day out. Driver turnover is closer to 17 percent in this side of the freight business.

The Great Recession hit YRC Freight particularly hard, and it shed drivers and customers alike. It has been through two financial restructurings, and its Teamsters employees have accepted pay cuts through 2019.

Still, YRC’s looking for drivers and making new ones.

Many of its dock workers are earning commercial drivers licenses, or already have them, and taking additional training to qualify as drivers, said Mitch Lilly, senior vice president of labor and employee relations. YRC set up a driving school at its Kansas City terminal and is working with a Teamsters’ school in Indianapolis.

“We are hiring drivers today. We’ve hired 1,015 this year,” said Lilly, who hopes to push the total to 1,500 by the end of October.

The job falls to Dave Renfrew, who became director of recruitment in January and has added six recruiters since. One of those is Paul Thompson, a one-time U.S. Army tank commander who turned to recruiting for Uncle Sam and now for YRC Freight.

Veterans make good candidates for driving a truck, Thompson said, “especially now that so many are coming out of the military.”

Self-inflicted pain

Much of the pain companies are feeling is self-inflicted, said Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association based in Grain Valley.

Spencer said the job had become more difficult even as carriers let drivers’ pay lag behind the earnings potential that they could find in other jobs, often jobs that also let them return home each night. And the trucking companies don’t necessarily disagree with that.

Tough times had weighed on the rates carriers could charge shippers, and that cut into what they say they could afford to pay drivers.

Bankruptcies also left many drivers on the side of the road. Klemp, whose research firm focuses on driver compensation, said companies covered their driver turnover from that pool of experienced hands.

Companies didn’t recruit new drivers, and so the average age of drivers crept higher, making retirement a bigger issue.

Changes in regulations have added to the tight market. New hours-of-service requirements have cut back the amount of time a driver can stay on the road. Stricter use of driver physicals has culled the herd further.

The recovering economy, like rebounds before it, has increased the amount of freight moving and the demand for drivers.

A big difference this time is that the shortage is more severe even though the economy’s recovery has been relatively modest.

“This shortage looks to me like it’s here to stay,” Klemp said.

To reach Mark Davis, call 816-234-4372 or send email to mdavis@kcstar.com. Follow him on Facebook and Twitter @mdkcstar.

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