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The Real Trucker Crisis Isn't the Shortage

Anyone in U.S. industry knows the importance of goods and freight delivered on time, and in turn on truckers. 72.2% of all freight transported in the U.S. in 2021, when freight was at its peak, was transported by the trucking industry, and amounted to 10.93 billion tons. That year, the trucking industry was worth $875.5 billion, 80.8% of the U.S.’s freight bill. 302.14 billion miles were covered by registered trucks in 2020, the most recent year with full publicly available data. Trucking is a major employer thanks to its massive, pan-national role. In 2021, 7.99 million people were in jobs related to trucking, almost 6% of all full-time U.S. jobs, of which 3.49 million were truck drivers.

This lucrative industry, however, which depends on those who drive the freight, is ruthlessly underpaying its workers. Just 32% of freight trucking costs are spent on driver wages. For perspective, for every $1 spent paying drivers, trucking companies spend 81 cents on fuel, and $1.25 on fuel and truck payments combined. Despite paying more on maintaining the trucks than on those who drive them, 85% of trucking companies consider driver-related costs ‘a challenge’. The data suggest otherwise, says Karen Levy, freight expert and author of Data Driven: Truckers, Technology, and the New Workplace Surveillance, who points out how many aspects critical to the job are, literally, not paid for. Drivers are paid by the miles they drive; loading, inspecting the truck, refueling, and even traffic, go unpaid, disincentivizing truckers from working safely and taking care of their health.

Karen Levy describes the trucking payment structure as “an effort to align drivers’ economic incentives with those of trucking firms, by encouraging them to maximize revenue productive time and concomitantly minimize time not spent moving goods around the country”. In simple terms, drivers are forced to spend as much time as possible driving – making their employers money – and as little as possible on ‘other parts of the job’ – taking care of themselves, their vehicle and the freight they are transporting. Since drivers are paid by the mile, furthermore, there is no time recognized as overtime. The Fair Labor Standards Act, which celebrates its 85th anniversary this year, protects almost all other working Americans from unpaid overtime. In one survey, one in three long-haul drivers admitted to falling asleep while at the wheel in the month before they were surveyed. Vehicle operators are 9 times more likely to be injured, and, staggeringly, 10 times more likely to be killed, at work than the average U.S. worker – so says the U.S. Department of Commerce.

Karen Levy, freight expert and author. (Mike Levy, The Observer)

Back to a statistic quoted earlier, that 85% of trucking companies consider driver-related costs ‘a challenge’. Trucking in 2021 was a $875.5 billion industry; back in 1982, it was worth $170 billion in 2023 dollars when adjusted for inflation. According to Levy, a trucker in 1980 earned an average wage equivalent to $110,000 today; the median trucker in 2021 earned $47,130. The math is straightforward: in the time the industry has grown by +415%, wages have shrunk by -57%. For every 1% that truckers’ pay has diminished, the industry has increased by 7.3%. Considering that drivers are only paid by miles driven, not hours worked, every one of those dollars earned, by the standards of almost every other worker in the U.S., was an underpaid dollar – and that’s ignoring the more than $60,000 dollars lost by comparison to the average pay four decades ago.

Trucking companies continue to refer to the "trucker shortage", as if it is some new phenomenon, when the solution is simple - better pay. Years of rolling back truckers’ rights have had a profound impact on pay, and it is no surprise that far more drivers are leaving than joining the profession. Th

e average annualized turnover rate of long-haul drivers at larger companies was 96% in the third quarter of 2021. In response, the American Trucking Associations (ATA) issued a press release in January 2022 raising the alarm that America would be short by 80,000 drivers. More than a year later, no real action has been taken, and little has changed. As Jalopnik summarized, “there is no trucker shortage without a pay shortage”. The ATA has since said that 110,000 drivers will need to be recruited annually to meet the need for 1.1 million new drivers this decade.

Sociologist Steve Viscelli, author of “The Big Rig: Trucking and the Decline of the American Dream”, has pointed out that a number of pitfalls put truckers at significant financial risk before they are even entitled to a salary. Training required for the job takes months, and is a costly process. Larger trucking companies offer training to drivers, who in turn sign contracts promising to pay their employers thousands of ‘training’ dollars for the training if they leave the job. Viscelli refers to such contracts as a form of “debt peonage”: once you’re there, you can’t leave, because if you do you’ll face debts you can’t afford. Director of the Consumer Financial Protection Bureau, Rohit Chopra, issued a statement in February 2022, saying “Too many American truckers are set up to fail with financing schemes or coerced into paying junk fees […] we must ensure truckers who work hard don’t face financial ruin”. How much has changed in the 15 months since Chopra issued this alarm call?

Truckers demonstrating for better employee protection. (Teamsters Local 848)

Beyond the legally sanctioned tactics used to underpay and obligate truckers to brutal working hours, fraud is on the rise while working conditions are deteriorating. ‘Detention time’, the hours spent waiting for and loading or unloading cargo, goes unpaid, and this detention time is increasing due to double broker fraud. Freight brokers target customers, use fake identities to pretend to be drivers, and post the load again – real brokers and freight companies are then required to deliver a shipment they have received little or no payment to ship. Carrier payments platform TriumphPay has calculated double-brokering fraud puts between $500m and $700m in fraudsters’ pockets annually. Truckers are legally entitled to request freight bills from brokers to ensure there is no foul play, but are often threatened with exclusion from brokering lists if they do so – presumably because brokers are uncomfortable with showing their industry peers how much money is going into the pockets of brokers and the trucking companies that employ truckers, rather than to truckers themselves.

Attempts to monitor or police this fraud are limited; truckers are spending more detention time waiting for, loading and unloading double-brokered freight; and the layover rates companies pay for overnight hauls, which are on the rise thanks to double-brokering, have dropped from as high as $1,000 to as little as $250.

Many have asked what the government and its federal agencies are doing to resolve the various issues that have collectively become a trucking crisis. 75 truck drivers, members of Truckers Movement for Justice, protested on May 1 outside Department of Transportation (DoT) offices in Washington D.C., demanding action to address ‘wage theft’ through no pay for overtime and non-driving aspects of the job which are contributing to hellish working conditions. Truckers Movement for Justice deputy secretary Caleb Fernandez, who has been a long-distance trucker since 2017, said truckers have “lost our patience”. He echoed the sentiment of many, questioning what had been achieved by Joe Biden’s trucking plan; the group met with senior DoT officials in 2021, but the set of initiatives agreed has failed to effect real change. “This has been going on for years and has only gotten worse with the lack of federal action. We don’t need taskforces and studies,” he said.

The Biden administration’s reaction has received mixed responses. $30 million has been committed to help expedite the process for issuing commercial driving licenses, a strategy which seems to ignore the reality that not enough people want to be truckers to match the number leaving the profession.

The Infrastructure Investment and Jobs Act of November 2021 (IIJA) created a new federal truck Leasing Task Force to prevent predatory truck leasing, but no body dedicated to tackling double-brokering has been established.

The section of the IJJA aimed at bringing in more truckers is a federal pilot program allowing 18-year-olds with a commercial driver’s license to drive intrastate trucks (trucks not crossing state borders) with a supervisor. Far from helping to make trucking safer, however, the legislation has merely lowered the age at which Americans can join an oppressive, unsafe and under-protected profession, rather than improving the environment of the profession to the point of attracting the far larger pool of people over the age of 21 who might otherwise join, or stay in, the job. According to the ATA, after all, the average age of a driver is estimated to be between 47 and 52, and the average age of trainee drivers is 35, close to double the newly-lowered threshold.

The minimum age for cross-state trucking is still 21, not changed by the law. Recent statistics estimate that 60% of freight is interstate, meaning that, even if 110,000 18-year-olds joined the profession, there would still be a shortage of 66,000 interstate drivers – and another 110,000 qualified heavy goods drivers would need to be found to serve as supervisors until mid-2025. Clearly, the IIJA does not address a number of key issues that will continue to plague the trucking industry and its workers if nothing is done.

Senators Portman, R-Ohio, and Sinema, D-Ariz., presenting the IIJA. (Alex Wong, Getty Images)

In March 2023, bipartisan legislation was presented, titled the ‘Strengthening Supply Chains through Truck Driver Incentives Act’, to tackle training debts. The Act, if passed, would create a two-year refundable tax credit of up to $7,500 for truck drivers holding a valid Class A commercial driver’s license, and a refundable tax credit of up to $10,000 for new truck drivers and apprentices. The bill is a step in the right direction after years of inaction, but it does not mitigate pay conditions. In fact, the bill’s clause that truckers receiving the credit must drive at least 1,900 hours either is unaware that over half of truckers already exceed 40-hour weeks (and looks to ensure that they do so), or is recognizing a shameful state of affairs when approximately a quarter of workers in general labor reach a 40-hour week, the vast majority of them receiving compensation for overtime.

Freight and trucking are the beating heart of American industry, but the conditions, pay and respect for workers have declined drastically. It is unsurprising that a highly profitable industry that exploits its workers and denies them basic rights has been targeted by fraud and is facing a "trucker shortage", and it is alarming that so little is being done so late. The core culture, and the base standard of contract, must both change for working conditions to improve, and for the shortage to end. More Americans should know why their parcels are getting more expensive – and why many of the people delivering them are struggling.

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