The trucking industry is a driving force behind the success of our economy. 80% of all domestic freight is transported by large tractor-trailer trucks, equating to more than $700 billion in annual revenue. More than 7.5 million people work in the trucking industry, and about 15.5 million trucks operate throughout the nation. Despite its positive impact on the economy, the trucking industry is facing challenges. Here are the top identified issues in the trucking industry:
1. Truck Driver Shortage
“There is no one reason for the driver shortage, which means there is no one solution,” says Bob Costello, ATA’s chief economist. The driver shortage is a major disruptor in the trucking industry. According to the ATA, the trucking industry is missing an estimated 63,000 drivers, and this number is excepted to continue to grow. The average age of a truck driver, which is 49 years old, is a factor that is contributing to the driver shortage. Older truckers are retiring, but are not being replaced by their younger counterparts. This is worrisome, especially noting that Costello estimates the annualized turnover rate at 94%.
2. Hours of Service Rules
The Hours of Service (HOS) is the second issue affecting the trucking industry. The regulations call for additional flexibility that is applied to truck drivers, specifically for the sleeper berth provision. The Hours of Service rules limit the amount of time truck drivers are required to rest between driving shifts as well as limits the daily and weekly hours spent driving and working. Gary Helms a driver for Covenant Transport says, “the new rules are in fact not flexible enough and that they do not take into consideration the real sleeping habits of drivers. The mandated rest breaks have made truck parking worse.”
3. Truck Driver Compensation
Truck driver salaries have increased this past year in order to attract more workers to the industry. This comes in response to the overwhelming driver shortage and a result of many truck drivers expressing concern that their pay was not keeping pace with inflation. While driver compensation did rise along with the freight economy boom in 2017 and the beginning of 2018, this is not an issue that carriers can easily resolve.
4. Truck Driver Detention at Customer Facilities
Truck driver detention at customer facilities has negatively impacted productivity, regulatory compliance, and compensation. Truck drivers have reported a 27.4% increase in delays of six hours or more, with truck drivers reporting that dockworkers at customer facilities being the culprit for their delays.
5. Crumbling Infrastructure
According to the Chairman and CEO of XPO Logistics, Brad Jacobs, the problems of the United State’s infrastructure is widespread and include “crumbling bridges, roads, and tunnels.” Unsafe infrastructure interferes with a truck driver’s ability to transport goods safely and efficiently. Despite the fact that the Trump administration has proposed funding, Jacobs said that it is about 25 years late, and the spending plan outlined does not come without a cost: an increase in gas prices.
6. Safety
Safety in the trucking industry is crucial, and it is important to prepare for the unknown. Truck drivers need to remain safe while driving, which includes being provided with the support they need to be aware of their actions and surroundings. This also includes making breaks a non-negotiable.
7. Variable Costs
While trucking industry expenses tend to remain consistent, but uncontrollable variables can come to play. Staying informed about the decision being made on a federal- as well as a state-level will help to avoid surprise costs.
If you are a trucking owner and want to learn more about how TPIA is leading innovation in this space please contact jamie@truckingproudins.com. If you are an insurance broker interested to learn more about joining the TPIA team to leverage these unique tools please contact team@truckingproudins.com.
