The driver churn keeps churning
November 30, 2018
Some things never change. Take this media quote:
“The answer to the driver shortage has not changed. It’s still money. Pay more and you’ll find more drivers.”
It’s from a column in the October 1995 issue of Heavy Duty Trucking Magazine. Yup, 23 years ago, and I’m the guy who wrote it.
Of course there was no actual shortage of drivers. It was about retention. But I didn’t understand that then. Forgive me; I was young. The carriers said “driver shortage,” and I believed them. They believed it themselves, of course, and still do. But that doesn’t change the reality.
At the time, big carriers wanted to import English-speaking drivers from the U.K., Ireland, and Australia. Schneider, J.B. Hunt, and MS Carriers (Swift would devour MS in 2000) were trying to bring in foreign drivers, at least on a limited basis. Scaling that up would require a rules change on the part of the U.S. Department of Labor. So the carriers were lobbying the DOL and talking up the idea, how beneficial it would be for all involved. I didn’t think so.
“If the (DOL) rules change, larger carriers with the resources to act internationally could recruit drivers in numbers that would give them a substantial competitive advantage – particularly if they were able to hold or even lower wages in the process,” I wrote.
The carriers were overstating their case, of course, but so was I. They could not have imported enough drivers to have any impact in any case.
“There aren’t enough unemployed truck drivers in Ireland to make a difference,” Lana Batts had told me in 1994. Lana was the newly named president of the Truckload Carriers Association at the time. Back then it was called the Interstate Truckload Carriers Conference, a segment of the ATA. Lana was a long-time ATA veteran with an extraordinary grasp of the industry and a gift for colorful, straightforward talk.
The carriers did not manage to change the rules in the 1990s, but the Labor Department and other national, state, and local government agencies did fund driver training to help ease the “shortage.” They still do. Taxpayers still help feed the truckload industry’s giant driver-eating machine.
How old was the “driver shortage” in 1995? Good question.
In our interview, Lana readily acknowledged the “driver shortage” problem, citing predictions by the ATA Foundation that the economy would generate an ever larger demand for trucking.
“That (means) a lot of drivers, man,” Lana said. “Particularly the way we’re churning through them.”
Clearly, the problem was not new.
So when did it begin? I haven’t found documentation, so I can only guess. It had to be after 1980 in the wake of deregulation.
Among the rules that disappeared were the constraints of operating authority. Carriers were no longer limited to specific routes and service areas. They could pretty much operate anywhere. The new truckload industry began doing just that.
Up to that time, relatively few carriers covered the country legally. They tended to be private carriers and exempt – unregulated – haulers, usually of unprocessed food products, meat and produce, for example. Few of them stayed on the road for weeks at a time like today’s truckload drivers. Still those pre-deregulation, long-haul drivers were the same sort of drivers who provide the core of any truckload operation today. They’re all but devoted to the road and wouldn’t do anything else as long as they had a choice. You, maybe?
Obviously, there are only so many drivers like that in the population. But truckload carriers began sending trucks darting around the country like taxi cabs in Manhattan for weeks at time. It was a new trucking paradigm. The truckload industry grew explosively, and there simply weren’t enough of those special drivers to fill the need. There still aren’t.
At least that’s my theory. I’d love to hear from you if you have more or better information about those times.
So how much money would it take to end our wild driver turnover problem? Probably more than anyone would be willing to pay. “If we were paying guys $100,000 a year, you wouldn’t have any shortage,” Lana Batts told me in 1994. “You wouldn’t have any freight, but you wouldn’t have a shortage.”
Still, Lana thought driver pay should increase. In 1994, truckload drivers averaged approximately $28,000 a year. Lana thought that number should rise to between $40,000 and $45,000. That’s roughly $72,000 to $81,000 in 2018 dollars.
She was right, but In terms of real purchasing power for a driver’s household, it still hasn’t happened.