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Fleet Solutions Evolve with Ever-changing Lifestyles
Driver Shortages Force the Industry to Address Fleet Solutions, Payment and More
The trucking and transportation industry is facing a crisis. In fact, it’s the biggest crisis they have seen in over a decade and it is not the rising cost of fuel. It is a shortage of qualified, career drivers. With a growing online shopping segment along with giant retailers like Amazon and Walmart, we are seeing an even bigger surge in shipping needs, which means that unfortunately the driver shortage is growing parallel to the need for them. Even as some companies are offering signing bonuses and consistent pay raises, they are still facing a desperate situation. What some industry professionals are finding surprising is that the shortage is not the result of poor compensation, or not about fleet payment at all. In a word, the cause is based on “lifestyle” and not on salary bringing to light a new batch of fleet solutions.
According to the ATA (American Trucking Association), the average salary for the industry is $53,000. That is a $7,000, or 15% increase since the last survey conducted in 2013. Along with higher fleet payments in salary, companies are offering signing bonuses in cash ranging anywhere from $500 to $5,000. Companies are also offering compensation in the form of tuition reimbursements for training or education and more, in an attempt to address these lifestyle concerns.
“. . . carriers are offering thousands of dollars in bonuses to attract new drivers, and once drivers are in the door, fleets are offering benefits like paid leave, health insurance and 401(k)s to keep them. This data demonstrates that fleets are reacting to concerns about the driver shortage by raising pay and working to make the job more attractive,”
— ATA Chief Economist, Bob Costello
More and more companies are addressing the demands, but this demand for a better lifestyle does not just mean a manageable number of hours or a structured schedule.
How Fleet Payment Strategies Can Help to Address Lifestyle
It used to be that drivers were paid as their loads were completed and even then they might not be presented with a check. Often times they were required to travel back to their respective companies for a tangible, paper check from their fleet or payroll manager. Thankfully, along with every industry, fleet payment has come a long way. With electronic payments and direct deposits, immediate payroll processing might even be taken for granted but again, it’s not always about the money. Payment companies like EFS addressing the demand for a balance in lifestyle by offering their B2B customers strategies and tools that make it easier and faster for managers to process fleet payment through cards and mobile. Although both of these channels might seem compensation focused, they can still help to make the life of a trucker easier by making it more efficient, consistent, and reliable. EFS also provides more efficient ways to handle regulatory and compliance. Staying compliant involves many cumbersome processes that take away time and resources. Simplifying and digitizing the process will allow for more focus on completing the trip and less time doing paperwork.
6 ways to Address the Driver Shortage Beyond Fleet Payment
Along with increased pay and better benefits, there are other factors to consider. Here are just a few policy solutions and marketplace responses that could help to reduce the driver shortage:
1. Increase Driver Pay – Just as we are experiencing now with gas prices, the natural market reaction when there is a shortage of a good or service is to increase the price. In this scenario, that price would be truck driver wages. Most carriers have been offering pay increases, coupled with a comprehensive benefits package and 401(k)/tuition reimbursement options.
2. Decrease Time on the Road – Increasing time at home and decreasing time on the road, can take so many of those “lifestyle” issues out of the equation. With the LTL hub & spoke system and increased distribution centers, this makes LTL more desirable by decreasing the average length-of-haul and keeping our truckers more localized.
3. Lower Regulated Driving Age – The 18-20-year-old group has the highest rate of unemployment of any age bracket. Having the age minimum of a commercial truck driver set at 21 eliminates a large pool of competent workers from filling open positions.
4. Target Minorities, Women and Veterans – To effectively address the driver shortage, trucking companies should look for ways to entice more women, minorities, and veterans. Minorities and Women are an overwhelmingly under-represented group within the trucking industry. Veterans is another source of “low-hanging fruit” as many are looking to transition into fulfilling careers.
5. Autonomous Trucking – With the advanced technology autonomous trucking brings, along with the benefits of reducing daily driving stress and boredom, it’s sure to attract young, tech-savvy drivers to the industry.
6. Utilizing Less that Truckload Shipping – On the Road (OTR) and full-truckload (FTL) shipping methods are where the majority of the driver shortage takes place, as these methods require a lot of time on the road and that hard truck driver lifestyle. LTL and parcel driver’s, on the other hand, come home every night.
Clearly the industry is suffering, and companies are working hard to respond. In a world where life is becoming more important than money, it is time for fleet solutions to incorporate lifestyle requirements into compensation packages. An evolution of fleet payment could one day include more than fleet cards and mobile apps. Fleet compensation solutions could very well include more time off, tuition reimbursement for professional development and most importantly, home for the holidays.
Resources:
http://www.trucking.org/article/New-Survey-Data-Reveals-Increases-in-Driver-Compensation
https://www.usatoday.com/story/money/2018/04/26/truck-driver-shortage-raises-prices/535870002/