A widespread truck driver shortage is one of the more impactful results of 2020 for supply chain companies. A full 71% of the total freight tonnage handled in the U.S. is moved on the highway system, and while recent investment into intermodal infrastructure has improved opportunities for rail transport, shortfalls in the trucking industry will lead to substantial impacts to overall outcomes.
Unlike other COVID-related impacts, labor shortages in trucking aren’t easily fixed. Carriers will need to accept that driver shortages will likely become a part of the “new normal” for a period, and prepare strategies to deal with this uncertain future.
That’s not to say there’s nothing carriers can do to mitigate the wider impact of shortages in the near term. Identifying efficiencies in shipping and finding technologies to improve turnaround can build a more agile infrastructure that produces long term benefits (and profits for forward-looking firms).
Driver shortage contributing factors
Of course, the driver shortage is not news in the shipping community. Bill Graves, the former CEO of ATA, was quoted saying that a driver shortage was “among our industry’s top concerns” as early as 2003. But now, almost 20 years later and in the midst of a pandemic, the worst of his predictions are coming to a head.
The number of for-hire trucking employees decreased by more than 65,000 year-over-year in 2020. The outlook for 2021 isn’t any different–nearly 200,000 fewer drivers will hit the road thanks to a combination of rising training and recruitment costs, pandemic concerns, and impacts of the Drug and Alcohol Clearinghouse. Meanwhile, a 40% drop in CDL training at pandemic-impacted schools means many of those drivers won’t be replaced by fresh recruits anytime soon.
The result is a pretty dire situation for carriers at a time where reopening businesses and increasing ecommerce retail will drive up demand throughout the summer and into the holiday season.
Strengthen supply chain partnerships
However, it’s not all doom and gloom for carriers and freight forwarding companies. Innovative firms can take advantage of structural pressures to think about their networks and find ways to improve operational efficiency.
The foremost way that companies can overcome the personnel shortage is to focus on process improvement in-house. By streamlining paperwork processes and cargo handoffs, carriers can limit the downtime and unnecessary administrative work their drivers must undertake. Building partnerships with organizations at the port and in warehousing can streamline drayage and limit time spent in the yard — both of which do a lot toward maximizing the number of available drivers.
Finding flexible solutions to staffing shortfalls, such as hiring third-party freight forwarding firms or scheduling independent contractors on an agile as-needed basis, can ensure that customer expectations are met.
Enabling technologies in trucking
It doesn’t look like we’ll see widespread adoption of fully-automated rigs this year, but technology is improving by the day.
In recent years, industry powerhouses from Daimler to Volvo to General Motors (and Tesla, of course) have poured considerable investment into automating big rigs in a safe and sustainable way. As the technology improves, OTR and FTL long haul routes between major hubs may be taken over by autonomous, fully-electric trucks that can improve efficiency by lowering overall cost, and improve driver wellbeing by reducing the physical and mental impact of manual operation. Autonomous vehicles will likely be able to operate for longer hours, which reduces transit times and increases freight turnover.
For the foreseeable future, autonomous vehicles will require skilled drivers to monitor systems and offer manual intervention during dangerous conditions. And until these autonomous vehicles can fill the gap, carriers can improve operations with powerful software to handle route-setting, intermodal connectivity, and document management.
Already, software solutions are taking big data from GPS trackers, IoT devices, and external data like weather and traffic forecasts to produce more efficient routes, plan for scheduled maintenance, and get freight out of the loading dock and out on the open road faster.
Unfortunately, the truck driver shortage likely isn’t going away anytime soon. The best course of action for carriers is to position themselves for the future in any way they can.
Finding a partner with experience implementing technology can be a godsend for filling staffing shortages throughout the supply chain. For example, a 3PL provider at the port can help manage warehousing and freight forwarding, streamline intermodal processes, expedite drayage and much more. That way, your team can focus on creating value for the customer.
See how GlobeCon can empower your supply chain from the Port of Los Angeles and Long Beach. Contact us today.