The American Trucking Association (ATA), the largest national trade association for the trucking industry, holds an annual conference called the ATA Management Conference & Exhibition (MCE), which brings together nearly 3,000 trucking leaders from across the country. Key areas of discussion include economic, regulatory, and business trends focused on driving the success of fleets today and in the future.
Although the entire 2019 show was insightful, the highlight was a panel that discussed the top challenges (from an American Transportation Research Institute (ATRI) survey to ~2,000 trucking stakeholders) facing the industry. The panel was a diverse group including an economist (Robert Costello, ATA SVP & Chief Economist), truck driver (Gary Helms, America’s Road Team Captain at Covenant Transport, Inc.) and President/CEO (James Reed of USA Truck Inc.) of a trucking company.
Even in this time of dynamic growth and booming demand, the trucking industry faces some significant obstacles. The three major hurdles that stood out during the ATA MCE panel are all people-related challenges confronting today’s trucking industry.
A persistent driver shortage
ELD Mandate and Hours of Service
Detention at customer facilities
Challenge #1: Driver Shortage:
The trucking industry is getting hit as hard as any other in terms of talent scarcity. If current trends continue, the trucking driver shortage could increase to over 160,000 drivers by 2028.1
Several factors have led to this, including increased demand for shipping orders overall, due to increased e-commerce orders, demographic limitations, lifestyle needs, and more job alternatives available due to the lowest unemployment rate since 19692. According to the Census Bureau, the average age of a US commercial truck driver is 55, with the majority being white (71%) males (94%). Life on the road is trying. Over-the-road or CDL drivers can spend as many as 300 days a year away from family and friends, putting a strain on relationships. On top of all of this, there are a plethora of other job openings with similar pay and better hours for aspiring and current truckers.
Opportunity: To address this growing worker gap, the industry is launching several promising initiatives to entice retirees, military veterans, minorities, and women into trucking. Recruitment, however, is only part of the problem. While attracting drivers is difficult, getting them to stick around is even harder, especially as more companies offer signing bonuses and other hiring incentives. While higher compensation has slowed churn slightly, turnover is still high — 87% for large truckload carriers and 72% for small carriers in 20183. This suggests the need for trucking companies to invest in programs to attract, engage, and retain employees. Enter workforce management software. Talent acquisition technology empowers employers and candidates by simplifying the search and application process, while many solutions enable you to configure pre-screening questions to easily identify the most qualified applicants, while streamlined background checks accelerate hiring decisions so you can extend offers quickly — before candidates accept jobs elsewhere. In addition, predictive people analytics can collect and analyze labor data to pinpoint who is a flight risk and who needs to be re-engaged, ensuring your top employees stick with you.
Challenge #2 ELD Mandate
It’s been a little over two years (December 18, 2017) since the electronic logging device (ELD) mandate took effect. This set of regulations was implemented to improve roadway safety and increase trucking industry productivity. Nearly all commercial freight trucks must be equipped with a standardized ELD that synchronizes with the vehicle’s engine to record a driver’s Record of Duty Status to demonstrate compliance with Hours of Service (HOS) requirements.
There is still a lot of debate about the positive and negative impact of the mandate, including a lot of complaints about the mandates forcing drivers to drive faster (and less safely) to stick to the limits in driving hours. This had led some trucking companies to move from mileage pay toward component pay, which pays drivers for mileage and non-driving activities like loading/unloading. ELDs alone aren’t enough to track the breakdown of non-driving activities and corresponding pay rates, though. A labor management system capable of handling multiple pay types and pay codes makes it much easier to calculate component pay. Instead of trying to manage this complexity using spreadsheets, your managers can leverage integrated ELD and timekeeping data to deliver accurate driver paychecks.
Opportunity: Analysis of integrated ELD and labor management data can provide financial and operational insights while helping you identify ways to optimize driver satisfaction and engagement. Drivers dislike unproductive time — from long dock waits to breakdowns — that slows down their routes and forces them off schedule. Analyzing ELD and labor data helps you determine which non-driving activities routinely waste truckers’ time the most, so you can take action to boost efficiency and ultimately, give drivers back lost time that they can use towards driving more safely.
Click here to read more about how to harness value from the ELD data you're already collecting.
Challenge # 3: Detention at Customer Facilities
Nothing irritates a truck driver more than long wait times at shipping and receiving docks, since this negatively impacts a driver’s earning potential. Shippers have seen the impact manifested in increased freight costs, while truckers struggle with maximizing productivity and meeting delivery deadlines.
In the ATRI’s 2018 driver survey, more than 79% of respondents said that detention at a customer’s facility caused them to be late for or have to cancel their next scheduled appointment. Detention delays have negative impacts on driver productivity, regulatory compliance, and compensation.
All that lost time adds up to more than four billion hours that truck drivers spend waiting at facilities each year.4
The trucking and distribution industry should re-evaluate its detention policies and strategies to better ensure carriers and drivers receive fair compensation for long delays at the dock.
There are, however, steps that trucking and distribution companies can take to better enforce their detention policies.
By integrating timekeeping and ELD data, carriers can accurately account for all trucker time. This visibility enables new levels of transparency between shipper, receiver, and trucker, and assists businesses in quantifying the opportunity costs of loading dock inefficiencies. They can use this data to pinpoint problem locations, back up assessorial fees, or even renegotiate contracts to increase punitive charges for detention events.
Without trucks, America stops. It’s that simple. Yet in order to keep the trucking industry rolling along, numerous challenges must be overcome.
To aid companies in staying ahead of these top challenges, companies will need to utilize a centralized workforce management platform to help.
If you’re not investing in technology to manage your most valuable asset — your people — you may be missing your greatest opportunity to improve profit and service levels. When you use workforce management solutions to attract and retain qualified workers, improve bidding and billing profitability, maintain regulatory compliance, and gain valuable business insights, you’re in a better position to increase margins and achieve a sustained competitive advantage.
Download this white paper to dive deeper into the challenges facing the trucking industry
Kronos® solutions for trucking help control labor costs by delivering more accurate paychecks, provide real-time visibility into understaffing and absenteeism, and optimize your workforce to increase productivity.
1) Eric Miller, ATA: Trucking Industry Was Short More than 60,000 Drivers in Meeting Demand at End of 2018, Transport Topics July 24, 2019)
2) BBC News, U.S. Jobless Rate at Lowest Since 1969, May 3, 2019
3) Steven Martinez, Increased Trucker Pay Lowers Turnover Rates in 2018, Heavy Duty Trucking (January 4, 2019), found at https://www.truckinginfo.com/322179/increase-driver-pay-lowered-turnover-rates-in-2018.
4) Dean Croke, Hurry Up and Wait—A Trucker’s Worst Nightmare, FreightWaves, March 30, 2018, found at https://www.freightwaves.com/news/driver-issues/shippers-continue-to-detain-truck-drivers.