There is no denying the trucking industry is facing a shortage of labor unlike anything ever experienced before. Dubbed the “Driver Shortage”, the trucking industry is currently lacking about 51,000 drivers with the number only expected to increase to more than 176,000 by 2026.
However, trucking isn’t the only industry in the U.S that is feeling the effects of the growing labor shortage. If you ask almost anyone in any industry in the country right now about labor you are guaranteed to hear a common theme, “There aren’t enough workers to meet demand.” The U.S is experiencing a shortage of labor unlike anything in the country’s recent history.
The U.S Bureau of Labor statistics recently reported that the national unemployment rate is currently sitting at 3.7%; the lowest it has been since December of 1969 when the U.S was in the midst of the Vietnam War. More than 250,000 jobs were added last month alone which showcases a record run of hiring rolling on.
What does this mean for holiday 2018?
For months the trucking industry has been in a “Pox Romana” of sorts as demand for shipping has continually increased. With capacity remaining in a record crunch freight rates have skyrocketed leaving many companies to profit. The conditions for trucking are the most favorable that they have been in the last seven years.
However, during the holidays (otherwise known as Peak-Season in trucking) the trucking industry still relies on retail and e-commerce to pull in a majority of company revenue for the year. This holiday shopping season is expected be the largest ever as e-commerce shopping, for the first time ever, is expected to outpace conventional brick and mortar retail store purchases.
U.S online spending is expected to grow by 14.8% in 2018 to an anticipated $124.1 billion. More online shopping means more shipping, and with the driver shortage in full effect rates are expected to skyrocket even more throughout the holiday season.
The Retail Labor Crunch
Even though retail will account for a majority of the profits that trucking companies see this holiday season, the retail industry is not without its own problems.
Much like trucking, the U.S retail industry is facing a historic shortage of labor. In July, some 757,000 retail jobs were open across the country which is about 100,000 more than the year prior. According to the BLS, the number of openings of all types surpassed the number of hires from March – June for the first time in a decade.
Due to this retail chains have had to become crafty in their recruitment strategies; specifically, for seasonal and temporary workers who are essential to assisting with holiday demand. Kohl’s Corp. and J.C Penney Co. started hiring seasonal workers in June – about three months earlier than usual.
The shortage of workers for the holiday season is pushing retailers into much of what trucking has had to do over the past few months; raise wages. Target Corp. has stated that they plan to hire 12,000 seasonal workers and offer them a starting pay of $12 an hour plus additional benefits.
How much longer will the shortage last?
The answer: no one is entirely sure. The ATA has openly predicted that the driver shortage is only to get worse as older drivers transition into retirement and younger generations steer away from blue collar careers like truck driving.
As for retail, as long as the economy continues to boom, and the unemployment rate continues to drop there will be an issue. Historically, as the economy tends to get worse employment in industries like retail will rise. However, the economy doesn’t appear to be heading towards a lull anytime soon.
If there is one thing that this labor shortage has showed it is the simple fact that there is a deficit of skilled workers. For the first time in years employers are being forced to increase wages to both retain and attract top talent. But with increased wages the buck has to get passed somewhere, and that somewhere is the consumer.
Only time will tell how long the labor shortage will last, but for the first time (in a very long time) every industry in the U.S can agree that we’re all in this together, and we’re all struggling to find the most qualified people to get the job done.