Posts Tagged “drivers’ shortage”
Here’s four issues in the trucking industry to ponder – and you decide whether they are valid.
*The driver’s shortage is a hoax.
*One of the last concerns of large fleets is the well being of owner operators and small fleet owners.
*Regulations are killing the deregulated trucking industry.
*California produce rates have been lower in recent years and the reason may be different from what you think.
These four statements came to mind following a telephone interview with Kenny Lund, vice president of Allen Lund Co.
Is There a Driver’s Shortage?
When it comes to a driver’s shortage relating to fresh produce, Lund sees the only shortages being at shipping point and at the receiving end These involve short hauls from the field to packing houses and from receiver distribution centers to retail stores, restaurants, etc. But he doesn’t see a driver’s shortage with long haul produce transporation.
Lund concedes there may be a shortage of drivers with the larger trucking companies, stating, “if you have 300 trucks you have to come up with 300 drivers to fill them.” However, produce transportation is dominated by owner operators, who is the driver of his own truck. He doesn’t have to recruit other drivers.
Large Fleets Hurting Owner Operators?
“It seems the larger truck lines are doing everything they can to make it tougher on owner operators,” Lund states.
As examples, LaCanada, CA-based Lund points to big carrier support of everything counter to issues of importance to owner operators. He cites large fleet support of Electronic Onboard Recorders (EOBRs ) that will add costs, and support of California Resources Board (CARB) rules. Why?
Lund points out large carriers tend to rotate their fleets every five years and it is the owner operators who are buying their used trucks. This wouldn’t be so bad except the CARB rules require equipment such as reefer units not to be older than seven years.
“You have to retrofit it for a cost of anywhere from $8,000 to $20,000,” Lunds says. On the plus size, he adds the fleets are starting to realize the CARB rules are not only bad for owner operators, but for the whole trucking industry. Lund believes the damaging CARB rules are a much bigger threat to the industry than a driver’s shortage.
Growing Regulations
Perhaps the biggest threat to the survival of owner operators are the growing number of federal and state regulations.
“When you produce all these regulations on an one-horse operator, he doesn’t have the resources to comply with everything,” Lund states. “It’s really putting a strain on them.”
Why Have California Rates Been Lower?
Lund notes California produce rates have not been as high in recent years. At the same time he is noticing more truck shortages, but not in California.
“There’s just not as many trucks in California now. What has kept the rates down is there is not as much produce (being grown in California),” Lund contends.
It comes down to California’s intrusive regulations, etc. are also resulting in more produce growers shifting their operations to Mexico where the red tape and costs of operation are less. For example, similar to California, there is less produce being grown in the Lower Rio Grande Valley of Texas, yet more truck shortages are occurring there, as more Mexican grown fruits and vegetables are being shipped into South Texas.
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These issues are presented to you following a telephone interview with Kenny Lund. I have known Kenny’s father, the namesake of the company since shortly after his modest beginning in 1976 as a truck broker . Today, the company works with over 20,000 carriers, which are mostly owner operators. ALC arranges about 200,000 loads a year, with food items accounting for over 50 percent of the freight. Refrigerated loads make up about 40 to 45 percent of the loads.
While Allen Lund remains involved in the company, Kenny Lund has assumed a greater role in the continued growth and success of the operation. At the same time, the high ethical standards put in place by Allen nearly four decades ago, remain rooted in the company’s foundation. — Bill Martin
Michigan could have a record, or at least near record apple crop this season, but there may be fewer loads available for produce haulers. In a nutshell, there’s not enough farm laborers and there are worries of fruit actually rotting on the trees.
Question. Unemployment is at 7.8 percentange, but some reports state it’s more like 17 percent when including people who have quit looking for work. So why is there a labor shortage? If there is a driver shortage amounting to 20,000 a year, as claimed by the American Trucking Associations, with unemployment so high, what’s the problem?
Could it be that government assistance has become so common and so excessive that folks figure why should they work when there are food stamps, free cell phones, housing assistance, etc.?
Michigan agricultural organizations teamed up to send “help wanted” postcards to more than 300 farm labor contractors, mostly in Florida and Georgia, informing them of the state’s large apple crop and need for hundreds of qualified workers for the next few weeks.
About 20 to 30 percent of the state’s apples remain to be harvested. If the fruit isn’t picked by early November there’s a good chance it will be lost.
Apple pickers are paid $15 to $20 and hour, plus are provided with housing during the season. The crop is estimated to be about 30 million bushels this season.
If you want to know how produce trucking issues are viewed by some folks in 
the produce industry, you should have been at the annual convention of the United Fresh Produce Association, held in Dallas. Specifically, the session was held on May 1st by wholesalers/distributors and titled Examing Today’s Transportation Challenges and Alternatives.
The 60-minute meeting was held in the same Dallas Convention Center that will host the Great American Trucking Show August 23-25.
Among the issues dealt with were the driver’s shortage, detention, and hours of service. (Within the next few days I’ll provide more coverage on the session ranging hours of service to stolen loads and dicussions of alternatives to trucks for moving produce).
On the program was moderator, Ron Carkoski, head of Four Seasons Produce, Inc.; Alex Crow, national trucking manager, Hellman Perishable Logistics; Ken Nable, president of Kington and Associates Marketing, LLC; Dan Vache’, vice president, supply chain management, United; and Gary York, general manager, C.H. Robinson Worldwide, Inc.
Concerning the availablity of drivers, Crow noted there was only a “moderate” shortage of drivers — amounting to about 200,000. “We need to treat drivers as professionals. We are feeling the shortage,” Crow related. His logistics company had even hired professional “head hunters” to find more drivers. “We (as an industry) expect drivers to be professional, but often don’t treat them like professionals.”
Crow believes the driver shortage results from issues such as not paying them enough, to excessive waiting times for loading and unloading. “With the multi pick ups and multi drops we have to let the customers (receivers) know they need to pay (extra) for that.”
York at C.H. Robinson concurs. He points out driver salaries trail other occupations and many would be truckers chose higher paying jobs in construction and elsewhere.
“In 2004 we saw 1.6 million housing starts. Today there are about 600,000. Housing starts next year are projected to be about one million, and “drivers tend to go where the work is. As the economy improves, the driver shortage will increase, and transportation will cost more in driver wages.”
Vache’ of United, who has an extensive background with in-tranist temperature recording devices (such as Ryan Instruments and SensiTech), adds, “Drivers are tired, not just of being treated like second class citizens, but third and fourth class citizens. They are away from home a lot and they have families to support. What can we do to make it more attractive for drivers to enter trucking?”
York urges shippers and receivers to work on efficiency in reducing wait times at the docks. There also needs to be faster turn around times between loads. He notes while detention charges certainly are not “mainstream” in the produce industry, detention charges are being applied more than in the past.
A benefit for drivers will be advances in technolgy, York believes, which can be used to expedite action on loads involving claims. Technology can help “lay the blame” in a claims dispute and thus reduce the amount of claims arising.
Regarding efforts to increase gross vehicle weights for Class 8 trucks from 80,000 to 97,000 pounds, no one expressed much hope Congress will deal anytime soon with this issue.
Vache’ says increasing truck weight limits will be safer because of the industry continues to improve its safety record, equipment is better, etc. Heavier loads will also reduce the number trucks on congested highway.
York calls the idea of bigger trucks “appealing.”
Nable adds that heavier trucks will reduce the “footprint.” In other words, it would be good for the environment.
While the panel emphasizes the pros of increasing weight limits, the downside from a driver’s point of view were largely ignored. For example, increased weight limits will result in more wear and tear on trucking equipment, consume more diesel fuel, and result in higher costs of operation for the trucker. Will the produce industry willingly increase rates accordingly? Most truckers I have talked to believe they will be expected to haul the heavier loads without additional compensation. The prospects of the produce industry increasing freight rates for hauling heavier loads was not addressed by the panel.