Wisconsin’s trucking industry, which is trying to cope with skyrocketing fuel costs, faces another problem that is even more vexing for the long term: a labor shortage. The trucking industry in Wisconsin is projected to grow 20 percent to 61,120 drivers by 2012. Although trucking companies are eager to put more big rigs out on the road, they are facing a severe shortage of willing and competent drivers to meet the growing demand for their services. Insiders say the labor shortage in the truck driving industry is being fueled by a poor lifestyle image, cumbersome regulations, baby boomer retirements, a finicky insurance industry and untapped labor markets.
As truck companies compensate for higher fuel costs and increased personnel costs to compete in a tight labor market, those rising costs ultimately will be passed along to customers, thereby driving up the costs of American goods.
The United States is already short about 20,000 long-haul drivers, according to the American Trucking Association, which predicts that the shortage will increase to more than 111,000 by 2014 if current demographic trends continue.
And that shortage doesn’t take into account the retirement of more than 200,000 baby boomer drivers in that time frame.
The Wisconsin Department of Workforce Development (DWD) says an increase in demand for shipping services will further increase the demand for drivers.
An average of 1,000 new truck driving jobs will be created each year until 2012 in Wisconsin, according to the DWD. In addition, there will be about 840 truck driving job openings a year to replace drivers who have left the industry, the DWD says.
When more new jobs are being created annually than the number of replacement job openings, it indicates a surging labor shortage in the industry, according to Eric Grosso, a state labor market economist for the DWD.
“We are projecting new jobs will be created economically, which would be creating a higher demand for the occupation,” Grosso said.
Owners and mangers of trucking companies say the industry itself is partly to blame for the driver shortage. The negative image associated with truck driving careers, the increased importance of family life and competition for workers in other jobs have hurt the industry, they say.
“The benefit of being home more often, combined with the baby boomers nearing retirement, creates a pretty easy formula for concern,” said Robert Hutton, the new president and chief executive officer of Milwaukee-based Rock Transfer & Storage Inc.
“The biggest shortage is in over-the-road drivers, because they can make more money doing a lot of different jobs without the stress of traffic, regulations and not being at home,” said Chris Schmus, president and chief executive officer of Greenfield-based ProDriver Leasing Systems Inc.
To combat the driver shortage and attract more drivers, many trucking firms are adding newer trucks, increasing their pay scales, adding more regular schedules, getting a commercial vehicle insurance and investing in better communications technology for drivers to stay in touch with their families.
Other trucking companies are reaching out to communities or labor markets they haven’t worked with before to find more drivers (see accompanying story).
The industry has allowed the image of the truck driving lifestyle to fall too low, making it unattractive to young drivers, said Wayne Kotka, transportation manager with the Milwaukee office of Dawes Specialized Transportation, a specialized heavy haul firm.
“The pay is there, but people don’t realize it,” Kotka said. “It’s the image (of being a truck driver). The industry hasn’t done anything about it in a long time. Organizations could do a better job, but it’s costly.”
Creating a more positive image of drivers and the shipping industry may be the most effective strategy for trucking firms to attract new drivers, said Rob Reich, vice president of enterprise recruiting at Schneider National Inc., a Green Bay-based trucking and shipping firm.
“We’re continuing to put a positive image out there,” he said. “Drivers are out there on their own, and we want to help people understand the role they play. It’s a good career that pays well, and we have to do better at putting the word out on that.”
Publishing information about the salaries of drivers and the varying work environments of drivers could encourage more young people to consider driving for a living, Kotka said.
The average hourly wage for truck drivers in the country, according to the U.S. Department of Labor, is $16.56 per hour, or $34,444 a year, based on a 40-hour work week. Most long-haul drivers are paid per mile.
“People need to understand there are different jobs than just the 9 to 5’s,” Kotka said. “And some of them are exciting jobs.”
Schmus attributes the driver shortage to the retirement of baby boomers and to the lifestyle of driving a truck for a living.
“There are 11 million people in the U.S. with a Class A commercial driver’s license, and only a little more than 3 million use it for that purpose,” Schmus said. “Truck driving is not that attractive when you can go to a technical school (to get a well-paying blue collar job) instead and still have a family life.”
The long haul, over-the-road truck driving jobs are the toughest to fill in the industry, said Greg Groth, president of Milwaukee-based Tax Airfreight Inc.
“It’s a terrible lifestyle,” he said. “You’re eating bad food, sitting on your rear end and you don’t know when you get to go home.”
About 19 percent of American trucking and warehousing workers are union members or are covered by union contracts, compared with 14.9 percent of workers in all industries combined, according to U.S. Bureau of Labor Statistics.
The major union in the trucking and warehousing industry is the International Brotherhood of Teamsters. Milwaukee-based Teamsters Local 200 represents 5,000 Teamsters in Wisconsin who work for both public and private sector industry companies.
Freight company members of Teamsters Local 200 include Akron, Ohio-based Roadway Express, Inc.; Fort Smith, Ark.-based ABF Freight System Inc.; Overland Park, Kan.-based Yellow Transportation, Inc. and Holland, Mich.-based USF Holland, Inc.
“It is small wonder people don’t want to enter the profession,” said Tim Buban, principal officer of Teamsters Local 200.
Buban said truck drivers are over-worked, underpaid and away from home very frequently. The truck driving occupation is an undervalued profession, and the need for drivers is going to get worse before it gets better, Buban said.
“I say there is no driver shortage, there is a shortage of good jobs, which is the same in any profession,” Tim Buban, principal officer for Teamsters Local 200 said. “If drivers were treated with the respect and received the compensation they deserve, then there would not be a shortage.”
Union companies have higher retention and lower turnover than non-union companies in part because they offer living wages, pension plans and health benefits, which are unique in the field, Buban said.
Many trucking and shipping firms have tried to counteract some of the negative aspects of the truck driving lifestyle by adding features to trucks, improving their benefits packages and deploying better schedules.
Traditionally, truck drivers were only paid for when they drove, and they were not paid for vacations. Because of the driver shortage, that’s changing.
ProDriver Leasing Systems has implemented rewards and incentive programs, in addition to the traditional offerings of a 401(k) program and paid vacations, Schmus said.
The company’s drivers can have a flexible schedule for needed time off, or to work additional hours for more money. They can also participate in a merit program that provides four weeks of paid vacation.
“It is against the norm to offer this, but our turnover is almost zero after two or three years of employment,” Schmus said.
In addition, ProDriver Leasing Systems drivers talk to employees they know when they call in to their dispatcher, rather than speaking to strangers at a call center, which many trucking companies use, Schmus said.
“We communicate on a personal level with our drivers and know each driver’s desires, flexibility and variety of work,” Schmus said.
Some truck driving companies are hoping their newer fleets will attract younger drivers.
In April, Tax Airfreight launched a new division, called Flyer by Tax Airfreight Inc., which handles long-haul cargo.
To continue attracting the best drivers, the Flyer division will be fitted with brand new trucks that feature a taller sleeping area, allowing drivers to stand inside the sleeping area and store more personal items, Groth said.
The new trucks, scheduled to be delivered and be on the road by the end of September, will also have separate heating and air conditioning units, which will make them more comfortable while the drivers are sleeping.
“These are going to be high-end tractors,” Groth said. “They’ll be set up for comfort and livability.”
The trucks themselves will also have distinctive paint and chrome, which Groth said should help attract other drivers.
More importantly, said Tax Airfreight recruiting manager Jessica Weber, will be the way drivers are scheduled with the Flyer division. Drivers are promised they will be home at least two nights a week, and the company will also try to have them home for weekends.
“A lot of drivers go to a company that promises so much home time,” she said. “Here, it’s up front. What you see is what you get.”
Tax Airfreight believes the promise of more home time, along with good pay, health benefits and a 401(k) package, will attract the right candidates.
“Society is changing more toward family and home life,” Weber said. “The importance is changing. That’s why more people don’t want to go on the road.”
Schneider National also is placing an emphasis on home time. Earlier this year, Schneider started a pilot program with about 2,000 of its drivers, designed to get them home on a more regular basis, Reich said. Schneider has about 15,500 drivers and about 13,000 trucks.
"We have transportation planners working with dispatchers to get them home,” he said. “Predictability has been an issue in the past. And we’re still working to expand the program further.”
Some trucking companies say the insurance industry is to blame for some of the driver shortage.
Adalberto Oliveras, president of Milwaukee-based ACO Trucking, says he has been able to find plenty of drivers whom he thinks are qualified to drive his fleet of 13 trucks. Oliveras says he doesn’t mind hiring younger drivers with less experience, because he can share many of his own driving experiences with them. He has more than 2.5 million miles under his belt as a driver.
Oliveras says he frequently finds candidates who have a few years of experience and seem to show great potential for a long career with ACO Trucking. However, Oliveras says his insurance carrier often tells him he can’t hire that driver because of a lack of experience or other reasons.
Sometimes the insurance company doesn’t even give a reason for rejecting a driver, Oliveras said.
“I’m not running the show now – the insurance company is,” he said. “That’s where the insurance companies have to change – their ideas of being so finicky about who we hire. A lot of the big (trucking companies) are self-insured.”
High fuel prices are also problematic for Oliveras and other small trucking companies, but they can be overcome, he said.
“I’ve got two empty trucks now,” he said. “I need a driver.”
Larry Haase, vice president of the Flyer division of Tax Airfreight, said his company is hoping that the combination of higher pay and more home time for drivers helps it attract the best candidates.
“People say there’s a driver shortage,” he said. “I think there’s a quality shortage. It’s not just about numbers. It’s a shortage of quality. We want to have guys with experience, with self-pride and pride in the company too, to promote the company to other drivers and customers. And to get that, we’ll pay a little more.”
Truck Driver Shortage
U.S. truck driver shortage: 20,000
Projected 2014 U.S. truck driver shortage: 111,000
Wisconsin truck drivers: 51,170
Projected 2012 Wisconsin truck drivers: 61,120
Projected new Wisconsin truck driving jobs: 1,000 per year
