Trucker Shortage May Increase Peak-Season Trucking Rates
For the last five months, trucking companies and shippers have seen consistent increases in over-the-road volumes, reaching pre-recession levels. The slow, wintry start to 2014 and an early ocean freight PSS has increased the impact of the trucker shortage. According to the JOC, “The escalating driver shortage has become the leading check on over-the-road truck capacity, and if freight demand continues to stay above 2013 levels, the shortage is likely to lend to sharp increases in transportation pricing”.
The current trucking volumes and demand has lead some trucking companies to predict higher truckload rates. As the trucking capacity tightens, trucking companies will have to strike a balance between enticing compensation packages for truckers, including more consistent pay and home time, and higher, yet competitive rates for shippers, while maintaining profit margins.
Another factor in the trucking shortage is the large turnover of truckers at large trucking carriers. Some have observed that large trucking companies are not looking to expand the pool of truckers, rather, they are investing revenue in attracting experienced drivers with better compensation packages. This trend will not alleviate the trucker shortage, nor will it decrease the demand for trucking or trucking costs for shippers.
While truckload carriers are in a position to choose to transport the most profitable loads as well as the ability to refuse less desirable loads, the current demand has created a need for additional truckers. For shippers, the trucker shortage means that they need to have a large pool of trucking carriers in their back pocket to arrange transportation. Shippers should expect to see higher inland peak season trucking costs if current trends and demand remain consistent.