As the truck driver shortage continues, shippers scramble to retain, and recruit, drivers. For example, Joyce Brenny, chief executive of Brenny Transportation in Minnesota, gave her truck drivers a 15 percent raise this year, but she still can’t find enough drivers for a job which now pays $80,000 a year, a Washington Post article reports. A year ago, when customers would call Brenny, she could almost always get their goods loaded on a truck and moving within a day or two. Now, however, due to the driver shortage, she’s warning customers it could take two weeks to find an available truck and driver.

 

The U.S. has had a truck driver shortage for years, but experts say the shortage is reaching a crisis level this year. First, there’s even more demand for truckers since most industries are expanding, as are online sales. On the other hand, older truckers are retiring or are about to do so, unemployment is low, and it’s increasingly difficult to recruit young drivers who are critical of the long hours, long times away from home, and are further concerned that self-driving trucks may soon dominate the industry.

 

“I’ve never seen it like this, ever,” Brenny, who has been in the trucking industry for 30 years, says in the article. “It doesn’t matter what the load even pays. There just aren’t drivers.”

 

Brenny anticipates she will have to raise pay another 10 percent before the end of the year to ensure that other companies don’t steal her drivers.

 

“The drivers deserve the wages. They really do, but the raises are coming so fast that it’s hard to handle,” says Brenny, who is having to adjust contracts for drivers—and customers—rapidly.

 

As driver pay rises quickly and diesel fuel costs increase, shipping companies respond by charging higher rates to move goods. For example, it now costs more than $1.85 per mile to ship a “dry good” that doesn’t require refrigeration or special accommodation. That’s a nearly 40 percent increase from the price a year ago, according to research by DAT Solutions.

 

Higher shipping costs in turn cause manufacturers’ profits to dip. Economists warn that those costs almost certainly will eventually result in higher prices for everyday items that many Americans purchase.

 

“Every single good ends up on a truck at some point,” Peter Boockvar, chief investment officer at Bleakley Advisory Group, says in the Washington Post article. “Businesses which use trucking to receive and ship goods are going to do their best to pass on the costs to the rest of us.”

 

That already is beginning to happen. Amazon just implemented a 20 percent hike for its Prime program which delivers goods to customers in two days, and General Mills, maker of Cheerios and Betty Crocker brands, recently said prices of some of its cereals and snacks are going up because of an “unprecedented” rise in freight costs. Meat seller Tyson Foods and farm and construction equipment manufacturer John Deere also recently announced they will increase prices, blaming higher shipping costs, the Washington Post article notes.

 

In the meantime, executives at trucking companies hope they can entice more drivers to join their ranks with higher pay, signing bonuses, and shorter hours. The job doesn’t require a high school degree, and while it does require a truck license, many companies reimburse drivers for that cost. Then again, many potential drivers simply can’t afford the $4,000 to $6,000 cost of a six-week driver-training course when the fee is required up front.

 

Higher pay, shorter driving hours, and signing bonuses aside, the biggest challenges still seem to be the long stretches of time away from home, family, and friends. There also is a perceived lack of respect for the job itself. If young people think the job lacks respect, that will be a difficult perception to change.

 

What are your thoughts on the driver shortage? Do you see prices increasing? Secondly, how do increasing shipping charges impact your organization’s supply chain performance?