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Bracing for the Logistics’ Industry Unprecedented Labor Shortage

It may not be on your short-list of supply chain worries, but a growing U.S. truck driver shortage may soon warrant your attention. 

 

By the end of this year, the country's truck driver shortage will reach nearly 48,000, according to an October report from the American Truckers Associations, a national trade association for the trucking industry. That's up from 10 years ago, when in 2005, the first documented shortage was roughly 20,000. If the current trends hold, the shortage may balloon to almost 175,000 by 2024, the ATA reported.

Here are a couple other key findings of the report that may get logistics professionals' attention:

  • Over the next decade, trucking will need to hire 890,000 new drivers, or an average of 89,000 per year.
  • Roughly half, 45%, of demand for drivers comes from the need to replace retiring drivers; industry growth is the second leading driver of new hiring, accounting for 33% of the need.

But, it's not just a numbers game. It's also a skills game, similar to the labor and talent gaps other parts of the suply chain are experiencing.

“An important thing we learned in this analysis is that this isn't strictly a numbers problem, it is a quality problem too,” ATA Chief Economist Bob Costello said in a statement. “Fleets consistently report receiving applications for open positions, but that many of those candidates do not meet the criteria to be hired. According our research, 88% of carriers said most applicants are not qualified.”

Coming up with a solution could be a challenge, but Costello said it's something the industry can work through.

“Our work shows the great and growing need for drivers,” Costello stated, “but we also highlight several solutions including increasing driver pay, getting drivers more time at home, as well as improving the image of the driver and their treatment by all companies in the supply chain. Make no mistake, the driver shortage is a challenge, but it is not an insurmountable one.”

One of the biggest issues (and there are several) in filling these gaps is the amount of time truck drivers spend on the road. Truckers may spend as much a 10 days on the road before returning home, Costello said in this CNN article.

But what does this really mean for you? How can you sidestep problems with getting your products out the door to customers or into your docking bay?

While some of ATA's suggested solutions may be out of the hands of electronics supply chain professionals and fall onto the third-party logistics providers' list of responsibilities (such as increasing salaries, offering more at-home time, and lowering the driving age), here are a few things to consider now:

  • Evaluate what products are moved by train, truck, boat and air, and assess the risk associated with transportation delays and changing transportation modes and capacity loads.
  • Discuss truck driver turnover rates with your logistics partners and look at the practices they have put in place to address potential shortages.
  • Examine your current warehousing and inventory-holding strategies, and determine if inventory locations are strategically located or how driving distances may be shortened to accommodate short-haul trips.

How concerned are you about this shortage, and what plans are putting in motion to avoid delivery problems?

1 comment on “Bracing for the Logistics’ Industry Unprecedented Labor Shortage

  1. Tyler4242
    October 16, 2015

    This is a very informaive article. I've seen a few others referencing the labor shortage in skilled drivers of late. I've read that some economists are predicting this labor shortage to last another 15 years. 

    If that's the case then there needs to be something done to confront the issue. Although labor shortages are a part of history there can be ways to minimize the overall ecconomic impact in the forma of various community outreach initiatives. These could get people and kids in communities thinking about vocational work at an early age in addition to chipping away at the labor shortage. 

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