Weekend Economists Celebrate Harry Potter's 35th Birthday July 31st, 2015

[Demeter]

7. The manufactured trucker shortage BY MATHBABE

http://mathbabe.org/2015/07/30/the-manufactured-trucking-worker-shortage/

Have you been reading about the shortage of workers in the trucking industry? Have you wondered why, in this crappy economy, they haven’t been able to find more workers? Here’s an excerpt from recent Wall Street Journal’s coverage of this worker shortage crisis:

Operators across the country are short 30,000 long-distance drivers, the American Trucking Associations estimates. The group projects the shortage could top 200,000 in the next decade. Average annual pay for long-distance drivers was $49,540 in 2013, according to ATA estimates. Hiring and wages in truck transportation have inched up this year, according to the Labor Department.

I’ve got a theory. Here’s what it is: they trucking companies aren’t paying enough. Funny how demand and supply and efficient markets go out the window when there’s a political point being served, though: Congress is considering passing a law that would allow 18-year-olds to be long-haul truckers. A terrible idea considering how younger drivers are much more dangerous.

Of course, $50K isn’t nothing. But on the other hand, truckers have to be trained, competent, and regularly spend many days on the road. Moreover, the current surveillance technology has severely degraded their quality of life, which I learned by reading about Karen Levy’s work on the industry. Also, new truckers probably make substantially less than $50K when they start.

Partly the surveillance arose from the very real risk of truckers driving too much per day – it was an attempt to make sure truckers were driving safely. But since the technology has been installed in many large-company fleets, the companies have used it to essentially harass their drivers, telling them when break is over and so on. This has worked, in the sense that larger companies with more surveillance have managed to lower costs, pushing out smaller and individual truckers. And that means that truckers who used to own their own business now reluctantly work for huge companies. For an industry that has historically prided itself for its independent nature, this change does not sit well with drivers. The turnover rates are staggering:

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When you make your workers lives worse, and you don’t compensate them with cash money to make up for it, you find your workers quitting. That’s what’s happening here.

Conclusion: we either need to improve truckers’ work experiences or pay them more. There’s no worker shortage, there’s simply an unwillingness, on the employers’ side, to face up to the facts.