Currently, across North America, there is a shortage of freight drivers. It is an issue that goes largely unspoken, but it has potential to have large ramifications across many industries. Although there is already a shortage of drivers, the demand for drivers is increasing, and so is the regulation on driver scheduling, which is compounding the issue and making matters worse.
Economists are predicting the Gross Domestic Product(GDP) to continue to increase into the New Year, which is going to lead to an increase in demand for truck drivers. With a growing GDP, we can expect more consumer activity, which means more product shipments to meet demands. If this does go the way it is expecting, the demand for truck drivers is going to grow over the next year, spreading driver resources even thinner.
In addition to the increase in demand for truck drivers, there are new regulations that will be taking effect that is going to affect how long drivers can be on the road in a day, meaning they can’t drive as much as they used to. The ELD Mandate means that truck drivers everywhere will have to use an ELD – an electronic logging device – to record their driving hours and reports. Currently, a driver is limited to driving 10 hours a day, but some drivers alter their driver logs and drive more to finish out longer hauls. With an automated system, they won’t be able to do this anymore. This means that their efficiency will go down. Although this new system will be better for the driver’s health and safety, it does make it more difficult for the managing company to complete orders on time at their current prices. Ultimately, this will affect rates, and push prices up.
All of this is creating a perfect storm for the shipping industry. The shortage of drivers, increase in shipping needs, and the added regulations are a trifecta that will affect prices for all companies that depend on product shipment and will drive up prices to the end consumers. We are expecting to see this come to point by the end of this year.