The Car and Truck Fleet and Leasing Management Magazine

Trucker Shortage Situation Continues to Grow

March 14, 2006

CHICAGO – Over the past 25 years, the U.S. trucking industry hasn’t seen fiercer competition for drivers, with poaching common as the aging population leaves fewer recruits to go around, according to Reuters. "The industry faces a drastic driver shortage," said David Rusch, president and chief operating officer of CRST Carrier Group, a unit of privately owned Cedar Rapids, Iowa-based CRST International Inc., with a fleet of 3,600 trucks and annual revenue of $750 million. "Many companies have elected not to recruit new drivers, but go after drivers trained by companies like us." He offered J.B. Hunt Transport Services Inc. as an example. CRST took J.B. Hunt to court alleging the Lowell, Ark.-based company hired drivers CRST trained for $4,000 apiece while they were under contract and repaying training costs to CRST, according to the Reuters report. The U.S. federal court for the Western District of Oklahoma issued a preliminary injunction preventing J.B. Hunt from hiring new CRST drivers under contract. J.B. Hunt declined to comment on the ruling. The U.S. trucker shortage is expected to worsen and push up trucker salaries, a fresh burden for an industry facing high fuel costs while struggling to meet demand as U.S. imports rise from developing nations such as China and India. According to a May 2005 study by Boston-based consulting company Global Insight for the American Trucking Associations (ATA), the industry is short 20,000 drivers. If current demographic trends continue – an aging population with fewer white males ages 35 to 54, the mainstay of the industry – and U.S. economic growth matches expectations, that shortage could hit 111,000 by 2014, according to the Reuters report. Truck drivers are simply less willing than in previous decades to spend nights away from home, particularly long-haul drivers who make up 1.3 million of the 3.4 million U.S. truckers. Trucking companies now offer signing bonuses of up to $5,000 and benefits similar to tactics the U.S. armed forces use to attract young Americans. The May 2005 Global Insight study estimated driver turnover at large U.S. carriers at more than 120 percent annually, so searching for drivers is a constant battle. Ray Kuntz, Chief Executive Officer and minority owner of Missoula, Mont.-based Watkins & Shepard Inc., which has a fleet of 700 trucks and annual revenue of $130 million, has arranged with his bank to provide low-cost study loans for prospective truckers to obtain qualifications then repay them through working for him. Industry publication Commercial Carrier Journal named Kuntz Innovator of the Year for the program. Experienced drivers now demand higher wages, often commanding annual salaries over $60,000. The average for heavy truck or tractor-trailer was $34,920 in November 2004, according to the most recent Bureau of Labor Statistics figures made public. Some trucking companies have passed high oil prices to customers through fuel surcharges. And higher wage costs are an additional burden. But some trucking executives said there is only limited room to pass on additional wage costs, according to Reuters.
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