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Driver Shortage Creates Quandary for Trucking
Layover Magazine ^ | February 6, 2008

Posted on 02/11/2008 5:33:39 PM PST by 2ndDivisionVet

A conspicuous shortage of truck drivers is creating a Catch-22 of sorts for the trucking industry, according to recent comments by carrier executives.

On the one hand, a lack of drivers is restricting the ability of trucking companies to expand and meet current freight volumes. Yet that same lack of drivers results in tight capacity, which is allowing fleets in many cases to get higher rates from customers and reject unprofitable business.

"Our results for the quarter were assisted by a favorable relationship between freight demand and truckload capacity," said Steve Russell, chairman & CEO of Indianapolis-based truckload carrier Celadon Group.

"We believe capacity growth in our industry continues to be constrained by a shortage of qualified drivers," he continued. "Assuming a continuation of the current freight environment, where growth in freight demand has exceeded increases in truckload capacity, we believe there will be opportunities to continue to raise freight rates faster than cost increases. Consequently, we continue to be confident in our ability to move to a 90% operating ratio or better."

"A solid U.S. economy and a favorable relationship between shipping demand and truckload capacity contributed to a 5.9% increase in our average revenue per loaded mile," noted Kevin Knight, chairman & CEO of Phoenix-based Knight Transportation.

"Solid productivity, improved fuel surcharge collection, and constant focus on expense control more than overcame cost increases relating to higher prices of revenue equipment, higher diesel fuel prices, declining fuel efficiency due to emissions control regulations, and increases in driver compensation," he added.

"Customer demand for our services continued to be strong," said Randolph "Randy" Marten, chairman and president of Mondovi, WI-based refrigerated carrier Marten Transport. "The combination of solid freight demand with limited industry-wide capacity and strong freight selection by our sales and operations team contributed to a 6.6% increase in our average freight revenue per total mile."

Still, the growing lack of drivers is causing fleets a variety of headaches - especially in terms of the bottom-line impact.

"The limited availability of experienced drivers continues to challenge the trucking industry," said Russ Gerdin, chairman & CEO of Coralville, IA-based Heartland Express. "We recently announced a driver pay increasa result our most senior and experienced company drivers will be earning 50 cents per mile while our owner-operators will be earning a base rate of 95 cents per mile by the end of 2006."

Marten Transport reached even deeper into its wallet to try and shore up its driver base by making a big equipment purchase at the end of 2005.

"After evaluating our expectations for customer demand, the continued attrition of owner-operators from our industry and our ability to attract and retain company drivers, we decided to take delivery of 246 tractors during the fourth quarter last year, more than half of the increase for the entire year," said Randy Marten. "But we believe that continuing to increase our capacity is important to major customers, and we wanted to make sure that we were prepared to grow with our customers in 2006."

"The driver recruiting and retention market remains more challenging than ever," said Clarence Werner, chairman, president & CEO of Omaha, NE-based Werner Enterprises. "The supply of qualified truck drivers continues to be constrained due to alternative jobs to truck driving that are available in today's economy. Yet we believe that a solid freight shipping market.. combined with extremely tight truck capacity is [maintaining] a strong freight market."

For more information on this publication, or to subscribe to the print edition, visit http://www.fleetowner.com.


TOPICS: Business/Economy; Culture/Society; Extended News
KEYWORDS: freight; logistics; transport; trucking
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1 posted on 02/11/2008 5:33:44 PM PST by 2ndDivisionVet
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To: 2ndDivisionVet

Sounds like a “pay shortage.”


2 posted on 02/11/2008 5:35:57 PM PST by Shermy
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To: 2ndDivisionVet
Se Habla Espagnol?
3 posted on 02/11/2008 5:36:19 PM PST by Mark (REMEMBER: Mean spirited, angry remarks against my postings won't feed even one hungry child.)
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To: 2ndDivisionVet

How come when there is a material shortage and prices rise, it’s expected, but when there is a labor shortage and higher wages are needed to pull in labor it’s a “quandary”?


4 posted on 02/11/2008 5:37:17 PM PST by dan1123 (McCain has an American Conservative Union rating of 82.3; Clinton has a rating of 9.)
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To: 2ndDivisionVet

Lets see, driving 11 hrs a day and working 14 hrs/day and maybe somedays making less than minimum wage....gone for weeks on end, bathing in public showers, and eating garbgage for weeks............ gee... I wonder why???????


5 posted on 02/11/2008 5:37:51 PM PST by MrPiper
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To: 2ndDivisionVet

Let them do what they did in the 90’s: empty the prisons.


6 posted on 02/11/2008 5:39:43 PM PST by Old Sarge (CTHULHU '08 - I won't settle for a lesser evil any longer!)
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To: 2ndDivisionVet

What a load.


7 posted on 02/11/2008 5:41:12 PM PST by cripplecreek (Just call me M.O.M. (Maverick opposed to McCain.))
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To: Shermy

Pay shortage? At 50 cents per mile and 55 mph, Heartland is paying their experienced drivers $27.50 an hour. How much do you reckon they’ll have to pay to attract enough drivers?


8 posted on 02/11/2008 5:44:47 PM PST by Qout
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To: Qout
Pay shortage? At 50 cents per mile and 55 mph, Heartland is paying their experienced drivers $27.50 an hour. How much do you reckon they’ll have to pay to attract enough drivers?

.And what do they pay while the truck is not moving waiting on a load?

9 posted on 02/11/2008 5:47:52 PM PST by MrPiper
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To: MrPiper

Its a manufactured shortage if it exists at all. If not it’s an attempt to manufacture a shortage.

Over the past two years my mother’s pay has been cut by almost $20,000 due to being short routed. Kept in service but off the road for hours every day. In other words she gets paid by the mile but is being sent 100 miles to sit for a day before being sent another 50 miles to sit some more.


10 posted on 02/11/2008 5:48:00 PM PST by cripplecreek (Just call me M.O.M. (Maverick opposed to McCain.))
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To: 2ndDivisionVet
I spent years in transportation management.

The truck drivers coming in to the business in recent years are a scary bunch.

They can’t do logs (DOT requirements), they can’t follow directions (i.e. read a map), they cannot back up a semi w/trailer into a marked bay, and they won't touch the freight once they finally do get a trailer into a dock. Let some teenager working minimum wage get it, and break his young back.

The truck driver shortage has been forecast for a long time now.

I guess that we’ll all be needing a good supply of Mexicans, and a lot of road signs for Spanish speakers.

Good luck posterity.

11 posted on 02/11/2008 5:48:41 PM PST by Radix (I do not want to press one for English.)
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To: MrPiper

Oh, and when did they start paying by the hour?


12 posted on 02/11/2008 5:49:12 PM PST by MrPiper
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To: Shermy

Ah, more jobs American’s won’t do.


13 posted on 02/11/2008 5:49:52 PM PST by mr_hammer (...checking the breeze and barking at things that go bump in the night.)
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To: 2ndDivisionVet

Something the article doesn’t state is that any driver hauling hazmat has to undergo FBI background checks and are barred from driveing due to certain criminal background. Homeland Security doesn’t want criminals and nuts hauling hazmat, but this depleats the driver pool even more.


14 posted on 02/11/2008 5:49:56 PM PST by umgud
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To: 2ndDivisionVet

In my local circualrs and weekly advertisers there is at least 1-2 dozen listings for people with CDL licenses.


15 posted on 02/11/2008 5:50:30 PM PST by LukeL
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To: Radix

See post 5,,, when they start paying drivers by the hour instead of by the mile, you will get drivers. The truck diving business is a racket!


16 posted on 02/11/2008 5:52:36 PM PST by MrPiper
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To: Qout

50 cents a mile is nothing. Mohammed the taxi driver does better than that, and he gets tips on top of it.


17 posted on 02/11/2008 5:54:04 PM PST by bshomoic
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To: MrPiper

They don’t pay by the hour. They’ve always pay by the mile. So if you’re working for Heartland Express and stuck in one of those notorious Iowa traffic jams, you’re not getting paid anything.

OTH, few trucks in Iowa are doing only 55 mph.


18 posted on 02/11/2008 5:54:17 PM PST by Qout
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To: MrPiper

Does the company pay for gas, or is the 50 cents a mile supposed to cover the gas?


19 posted on 02/11/2008 5:54:48 PM PST by bshomoic
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To: LukeL
In my local circualrs and weekly advertisers there is at least 1-2 dozen listings for people with CDL licenses.

Yep, all starting at $8.50/hr or 19 cents /mile

20 posted on 02/11/2008 5:55:50 PM PST by MrPiper
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