Trucking in the long haul
From the April 2023 print edition
Prospective employees are avoiding the trucking industry.
Not only that, but it’s estimated that in addition to around 7,200 retiring truck drivers, 27,000 truckers will quit the occupation annually.
The question is why?
Truckers in the Canadian road transportation sector can be classified into two groups: owner-operators and company drivers. Both have their own challenges, needs, and motivations. The latter group is the largest and most significant to the Canadian economy. The road transportation sector accounts for 40 per cent of the merchandise import and export to Canada.
The road transportation sector is a fundamental component of multi-modal and last-mile shipments, transporting goods right from raw materials sources to processing plants and retail stores. In 2018, the trucking industry generated nearly $39.55 billion from almost 63.7 million shipments.
More precisely, this industry carries an estimated $550 billion worth of goods purchased by Canadians and more than $300 billion worth of Canadian goods destined to export markets.
Yet, for years North American logistics companies in general and Canadian companies such as TFI International, Day & Ross, Mullen group and many more are facing a serious driver shortage.
Companies are worried about retaining their employees and managing their workload. A recent survey revealed that about 62 per cent of organizations are merely “somewhat prepared” to handle the workload with their current workforce, and only 32 per cent of them are “highly prepared.” About 6 per cent reported that they are “not prepared”
to deal with the shortage.
Canada’s trucking industry is comprised of about 320,000 fulltime and active drivers.
It’s a male-dominated industry, having merely 3.5 per cent female truckers. Whereas in the US, female truckers are around eight per cent of commercial drivers.
Stresses on the profession
Putting COVID-19 restrictions and the resulting impacts aside, poor working conditions, an aging population, low wages, and poorly skilled employees led to the labor shortage in the logistics sector, especially in the long-haul trucking industry.
According to the Ontario Chamber of Commerce, around 66 per cent of industries are facing labor shortages. Another source reported that around 18,000 truck driver vacancies were open in the second quarter of 2021. Statistics Canada anticipated that in 2023, the country may need another 25,000 truck drivers. In the US, this shortage is around 60,000 and estimated to hit 160,000 by 2028 if not addressed.
The truck driver shortage is catastrophic for the Canadian economy. In 2019, it was estimated that the shortage caused roughly $3.1 billion in lost revenues.
The reasons behind the shortage of truck drivers is multifaceted, in both the short to long term. The short-term reason revolves around COVID-19 and its implications. North American long-haul truck drivers travel nearly 200 billion miles per year, interacting with workers in the transportation, warehousing, retail, and manufacturing sectors, putting them at risk of contracting and transmitting viruses.
The subsequent closure of businesses, including those serving food to truckers in transit; and government regulations mandating vaccination to certain professionals including those in commercial transportation, caused frustration and anger among overstrained truck drivers, the majority of whom objected to the mandatory vaccination policy and temporarily stopped working.
Long-term reasons include a monotonous routine, poor diet, stress, and a lack of physical exercise and resulting health issues. In addition, the majority of the truckers complain that they receive low wages despite working in a physically demanding industry. The average pay for truck drivers in Canada is $23 per hour, while some companies compensate drivers for mileage.
Long working hours are another issue. In Canada, truckers are permitted to drive 13 hours per day, two hours more than their US counterparts. They also spend approximately an hour a day searching for parking and dock locations.
Another factor is an aging population. One study shows the largest age group of truck drivers employed in Canada is 55-64, which is older compared to other professions. A reason for the shortage of younger drivers is the high training cost for prospective truck drivers and the reluctance of employers to hire long-haul drivers who lack sufficient experience (commonly two to three years). However, due to the increasing shortage, 50 per cent of trucking companies plan to recruit comparatively young drivers.
The Ontario Chamber of Commerce has highlighted the need to attract and retain skilled labour in high-demand sectors. Several organizations are now working to resolve this issue.
To boost workforce retention, approximately 66 per cent of employers will increase hourly wages for both truckers and warehouse workers.
As well, 52 per cent of employers have increased bonuses, and 39 per cent hope to offer overtime pay. Consequently, according to a study by a Canadian trucking association, 12 per cent of the respondents said they would consider joining the trucking industry.
From a technology perspective, autonomous trucks seem to have a promising future in the wake of the driver shortage. Following the successful implementation of AGVs and AS/RS systems, autonomous trucks may have taken
a leap towards a fully automated supply chain concept. Automation in the trucking industry is in progress. According to a McKinsey & Company report, autonomous trucks will likely roll out in phases. In a platooning phase
a trucker will lead another driverless truck on interstate highways. In the next phase, a constrained autonomy phase, a lead driver drops off a platoon of trucks on a dedicated stop around an interstate highway from where autonomous trucks will operate in a platoon of driverless trucks. In the final stage, estimated to be functional by or after 2026, full autonomy will mean driverless trucks operating with precision from point of origin to point of destination without being constrained in cities or highways.
Alberta-based Suncor Energy has begun using autonomous trucks (ATs) for its site operations. After successful tests, the organization has added over 40 units of ATs into its fleet. This initiative proved cost efficient and helped Suncor save $10 million in annual operational costs.
Remember that truckers do more than drive. They are involved in loading and unloading, shipment verification, documentation and so on. All these processes will take time to automate. Organizations such as Embark, Locomation and Tesla have already increased their AT research and testing. Uber tested its self-driving truck loaded with shipments on a Western US highway under the supervision of a driver in the back seat. Starsky Robotics, which closed its operations in 2020 due to issues including the recession and technological challenges, had successfully driven a first fully unmanned truck on a highway in 2019.
Embark, an automotive-grade, self-driving software company, is also working with truck manufacturers to integrate self-driving and auto-pilot technology into their fleet operations. San Diego-based TuSimple is addressing industry issues such as driver shortages, operational transportation costs, improving safety on roads and environmentally friendly road trips, has also operated a fully autonomous semi-truck on open public roads in regular traffic, without a driver on board.
To address the driver shortage issue, Locomation, an autonomous trucking solutions company using human-guided technology and artificial intelligence (AI), has a more dependable strategy for organizations before they achieve full autonomy. Locomation’s technology will enable a convoy of two trucks and two drivers – a leader and a follower truck.
When on a highway, one trucker controls the lead truck, while the following truck will work in
an autonomous mode and follows the lead truck, with the second driver taking a break before taking his or her turn. This will help meet government regulations on work-hour limits but also improve capability to carry more load in a shorter time and with a smaller carbon footprint.
While these and other organizations are progressing towards more autonomy, they may face challenges. These include but are not limited to public and property safety issues in unpredictable scenarios, insurance claims, and related legal requirements. Software-run autonomous trucks are also at risk of cyberattacks and hijacking. Though seemingly implausible given the driver shortage, large-scale AT adoption will also jeopardize future trucker employability.
Another possible challenge is related to harsh weather and its impact on seamless AT operation. Although TuSimple ran a test operation in the harsh weather of Arizona and Texas, increasingly extreme weather remains a challenge.
The road transportation sector will change in the coming years. Younger drivers and more female drivers in long-haul road transportation on subsidized insurance can provide some relief. Yet while self-driving trucks need investment, regulatory approvals, and face infrastructure challenges, they will further ease the driver shortage.
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