New ATA report takes long look at the state of the driver shortage

While it is true that 2018 marked what could be described as a boom year for the freight economy, a new report issued this week by the American Trucking Associations (ATA) revealed that the trucking sector needed 60,800 more for-hire over-the-road truckload drivers at the end of the year to meet the nation’s freight services demands.

That was a key takeaway, among many others, in the report, entitled “Truck Driver Shortage Analysis 2019.”

The 60,800 figure is steep, to be sure, and the report notes that this tally represents a 20% gain over the 50,700 figure from 2017. As for 2019, the report stated that the driver shortfall is expected to be down slightly at the end of the year, due to a pairing of slower economic growth and a softer freight market in 2019 and a small bump in supply, driven by some large shippers doing a better job of reducing driver wait times at their facilities so that a driver can do more hauls and increase effective supply, as well as more people entering the industry than in the past.

What’s more, future shortage numbers are expected to grow, with the ATA’s report indicating that the trucking industry will need to hire 1.1 million new drivers over the next decade–an average of 110,000 drivers per year-in order to replace drivers that are retiring and to also keep up with economic growth and industry growth, with the latter representing 25% of new driver hires. And it added that if current trends remain in place, the shortage could rise to more than 160,000 by 2028.  

As for the primary reasons for the driver shortage, the report pointed to some familiar themes like the high age of the driver workforce, with the average age at 46. Another factor goes back to the issues in the trucking sector struggling to attract all segments of the population, as evidenced with only 6.6% of drivers in 2018 being women, with that coming in at the higher range of 4.5%-to-6.6% over the last 18 years. Minorities made up 40.4% of drivers in 2018, up from 26.6% in 2001. The report also said the ongoing struggle to find enough qualified drivers remains a challenge.

Even though the driver shortage creates an acute strain on trucking, the report made it clear it really is a supply chain issue, too, with 71.4% of all freight tonnage moving on U.S. highways, according to the ATA’s Freight Transportation Forecast 2019 to 2030.

ATA Chief Economist Bob Costello said on a media conference call that while this report looks at all tractor-trailer drivers, the shortage is focused solely on the estimated 500,000-to-600,000 for-hire over-the-road truckload drivers, which is where the vast majority of the driver shortage lies.

“We did bring more people into the industry, but the shortage will start to move north again longer-term,” said Costello. “If things do not change, the shortage will be over 160,000 by 2028. It serves as a warning to the entire supply chain. I don’t believe we will get there, because today the shortage is an operational hardship for the supply chain. But, at some point, if we continue down that line, we get closer and closer to the 160,000 [number], it will be a real problem for the industry, for the supply chain, and the broader economy.”

In describing how the ATA defines the shortage, Costello said that it is the difference between the drivers needed to move the amount of freight that is out there and the supply of drivers.

And in its forecast, the ATA takes the expected growth in truck freight and compare that to the expected supply of drivers, assuming the industry does no better job in getting a higher percentage of drivers in various demographic groups.

“The industry is growing the driver population,” said Costello. “It is just not growing fast enough. Also, some people confuse the driver shortage with driver turnover, but turnover is not the same and not addressed in this report. However, we do generally see turnover rise as the driver market gets tight, and this is because fleets go out there and start competing for each other’s drivers, they lure them away, offer sign-up bonuses…so you see this churn in the industry.”