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Saturday, 09 June 2018 12:30

‘In a Pinch:’ Logistics companies struggle to find qualified truck drivers

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Paul Laidler, the director of transportation operations at Columbian Logistics Network Inc., said the company has had difficulty filling open driver positions in recent months. The company’s situation comes as an industry association projects a shortage of 174,000 drivers by 2024 if the current trends continue. Paul Laidler, the director of transportation operations at Columbian Logistics Network Inc., said the company has had difficulty filling open driver positions in recent months. The company’s situation comes as an industry association projects a shortage of 174,000 drivers by 2024 if the current trends continue. COURTESY PHOTO

Despite interviews with countless possible candidates over a period of months, Columbian Logistics Network Inc. continues to struggle to find qualified truck drivers in West Michigan. 

According to Paul Laidler, the director of transportation operations at the Grand Rapids-based full-service logistics firm, the company is “not having great success” filling positions as current employees retire or transition to new jobs. That’s despite offering a $15 hourly starting wage and 34 cents per mile.

The problem filling open positions stems primarily from the lack of qualified drivers and an aging demographic that “doesn’t want to work anymore,” he said.

“We don’t have a lot of turnover, but over the last six months, I’ve been continuously interviewing, taking applications, qualifying drivers … and I am obviously not having great success,” Laidler said. “We are in a pinch.”

The national shortage of drivers has emerged in recent years as a key concern for the logistics industry and the many other firms that rely on trucking to move products. According to the American Trucking Associations, the U.S. could be short more than 174,000 drivers by 2026 if current trends continue to play out.

The issue has even percolated into the local economic survey findings for the Institute for Supply Chain Management at Grand Valley State University.

Economist Brian Long noted in his latest study that “the cost of truck transportation is starting to escalate at a much more rapid rate than expected,” especially with fewer people qualified to drive trucks and many logistics companies already reaching capacity.

“As consumers, everything you want is at the store — bread and milk — and you don’t have problems,” he told MiBiz. “However, logistically the problem is (these companies) cannot get enough trucks. They call the logistics company and they are at capacity and … are on overtime. (Companies) are paying double the price for logistics companies. In some cases, it’s going to cost (them) another $400 for a load.”

Over the last nine to 12 months, Laidler’s also seen rate hikes among trucking companies, which he attributes to the economic boom and an increase in consumer activity.

“Our industry, typically, has been cyclical, and I think we are coming into that part of the cycle where the equation has flipped a little bit in favor of the trucking companies,” Laidler said. “Rates are going up and in many cases, (trucking companies) are … increasing the size of their fleets, buying more equipment, or hiring more drivers. Trucking companies are in growth mode, we just have to fill those positions.”

TRAINING TO COMBAT SHORTAGE

According to Terry Hoogerhyde, recording secretary at Teamsters Local 406, a Grand Rapids-based labor union, many trucking companies are being forced into “thinking outside the box” to address the driver shortage.

“If they have a warehouse and transportation (department), they will let their warehouse workers go to a truck driving school, get qualified, get their (Commercial Driver’s License) and let them come out and drive trucks for them,” Hoogerhyde told MiBiz. “It’s a lot easier to find warehouse workers and dock workers than it is to find experienced truck drivers currently.”

At the same time, Columbian Logistics, with 22 drivers, also is looking at ways to attract new workers and retain the existing drivers.

Laidler said the company is considering changing its business model by assigning flexible shifts to tap into the younger driver pool, while also accommodating older drivers.

“In one case, we are looking at moving one of those drivers — an older guy that maybe doesn’t want to work as hard and may retire — and we are looking to utilize him in a manner that fits him on different shifts, different hours, different types of work,” he said.

OFFERING INCENTIVES

To combat some of the truck driver shortages, large trucking companies are offering sign-on bonuses at rates as high as $5,000 to $10,000, according to Laidler. While Columbian Logistics doesn’t offer signing bonuses, the company is considering the incentive, he said, adding that firms need to “cater to the indirect desires of the driver.”

“This means more access to facilities as opposed to only being able to shower or get rest or get maintenance … at certain points,” Laidler said. “Larger companies are partnering with vendors and creating networks where they can provide those things.”

Similarly, Long said trucking companies are “flat out paying more” to lure drivers into the marketplace.

“I have one acquaintance that is an owner/operator and he works for a number of companies, and he’s only going with the company that is giving him the most per mile,” Long said.

CHALLENGES AHEAD

Despite different approaches to hiring prospective truck drivers, companies still have obstacles to overcome, Hoogerhyde said, citing the high costs for Commercial Driver’s License (CDL) certifications.

The cost of obtaining a CDL — what a person is required to receive before driving vehicles with a weight of 26,001 pounds or more — ranges from $3,000 to $7,500, Hoogerhyde said. Compounded with the expensive new electronic logging devices found in trucks, the cost barrier to entry is “putting a damper on having enough qualified drivers,” he said.

“As we all know, there are certain companies that do let their drivers run rogue, and as long as it looked good on paper, it was good for the company,” he said. “Now (with the electronic logs), you can’t get away with that. Once you’re out of hours, you’re out of hours.”

Long said trucking companies also increasingly struggle to find candidates who can pass a drug screening.

“You have to have people drug-free to run the equipment and drive the cars,” he said.

Aside from the industry’s various challenges, Hoogerhyde doesn’t think the sector is doing enough to promote the benefits of driving trucks to younger generations.

Employers could be going into schools to promote truck driving as a well-paid career option for students right out of high school or college, but instead a negative stigma still clouds the profession, he said.

“A fair amount of (the industry) is misrepresented,” Hoogerhyde said. “Do you work long hours? Absolutely. Twelve to 14 hours is sometimes the normal day. There are trucking jobs when you are only gone eight hours a day, just like a regular job. If you get into the long-haul trucking industry, then you … might be gone five days, seven days, two weeks, a month before you get back home. But it’s also a good career to start out in.

“The thing to remember for these companies, though, is if the wheels aren’t turning, then they’re not making money.”

Read 1514 times Last modified on Sunday, 10 June 2018 20:39

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