Trucking Through Challenges

Imagine a society without food, water, medical supplies or raw building materials. Without trucks, that dystopia would be reality. As the old saying goes, “When trucks stop, America stops.”

Nearly 80% of US communities and 86% of New Jersey communities depend on trucks for their medicine, food, raw materials and other essentials.

Overall, $875.5 billion in gross US freight revenues come from trucking, which represented 80.8% of the nation’s freight bill in 2021.

However, a slew of challenges, from an aging workforce, record fuel costs, and a lack of parking infrastructure, has put a strain on truck fleets across the country. In fact, when Gail Toth, executive director of the New Jersey Motor Truck Association, was asked to describe the trucking industry in one word, she said; challenging.

Despite these hurdles, the industry continues to move forward, but support for this vital lifeline is needed if we want to continue to reap the essential benefits that trucking provides us every day.

Driver Shortage

According to the American Trucking Association (ATA), the industry’s current shortage of more than 78,000 truck drivers could grow to more than 160,000 by 2030.

“The lack of Class A and Class B commercial driver’s licensed (CDL) drivers has been a nationwide issue for a while now,” says Bill Messenger, president of Pitman-based Campbell’s Express.

While the record-setting shortage of drivers in 2021 (approximately 80,000) has eased slightly, the current dearth of drivers is still causing a host of issues including: delayed deliveries, fewer loads, higher wages to attract drivers (leading to increased costs for freight), and more.

The underlying factors contributing to the driver shortage include the challenging lifestyle the job presents, as well as regulatory pressures, which have led some drivers to leave the industry altogether. However, perhaps the No. 1 contributing factor is the industry’s aging workforce, which has led to an increase in retirements.

In fact, data from the U.S. Census Bureau shows that 30.3% of the industry’s driver workforce is over 55 years of age.

This has led many to believe that the industry’s best strategy for reducing the driver shortage is to focus recruitment efforts on younger adults.

Chris Spear, president and CEO of ATA, cites the Infrastructure Investment and Jobs Act (IIJA) as a step in the right direction in terms of investments aimed at helping the driver shortage, among other industry challenges.

“Since the enactment of the IIJA, the US Department of Transportation has advanced numerous programs including the Safe Driver Apprenticeship Pilot Program (SDAP), a program for 18-20-year-old truck drivers to operate in interstate commerce,” says Spear. “It also announced its Women of Trucking Advisory Board to identify ways to increase the number of female truck drivers in the industry.”

However, despite these efforts, a survey from the American Transportation Research Institute (ATRI) revealed that many motor carriers have indicated that they will not participate in the SDAP due to onboard technology requirements and/or the cost of insuring young drivers.

“Identifying ways to overcome the insurance hurdles would provide an avenue for more fleets to participate and therefore open the door for more younger drivers,” Spear says.

Fuel Costs

In the aforementioned ATRI survey, across all respondents, fuel prices were selected as the top industry concern in 2022. ATRI analysis found year-over-year increases in fuel cost per mile of more than 35%.

Add increased labor prices, which many trucking companies are raising in an effort to retain and attract workers, to record diesel costs, and fleets had a particularly painful 2022.

“The current average cost for diesel is $4.31 per gallon, so it is down from the $5 plus a while ago,” Toth says. “Unfortunately, there’s not much a carrier can do to reduce costs.”

The good news is diesel prices do seem to be falling, with the US Energy Information Administration (EIA) forecasting retail gasoline and diesel prices will decline in 2023 and 2024.

EIA forecasts on-highway diesel prices to decrease to an average of $4.23 per gallon in 2023 before decreasing further to $3.70 per gallon in 2024. These forecast price decreases are based on EIA’s expectation of lower demand growth for diesel and motor gasoline with continued high production of those products.

Spear notes that high diesel prices are especially challenging for owner-operators, many of whom operate in the spot market where there is less ability to negotiate fuel surcharges to cover price volatility.

Fifty-five percent of respondents in ATRI’s survey believe the best approach for addressing high fuel prices is to stabilize the nation’s fuel supply through federal action, whether that be expanding refining capacity or increasing domestic drilling.

Parking Infrastructure

Another long standing challenge for the trucking industry is a lack of available parking infrastructure.

Using data compiled by the Federal Highway Administration, the ATA estimates that currently across the US, there is just one truck parking space for every 11 truck drivers.

“Most of the focus thus far has been on ways to create software or apps to identify the location of available parking spaces, but the issue is that there is a physical shortage of spaces, especially in the northeast region. New Jersey alone has a shortage of more than 1,000 spaces,” Toth explains.

Toth says that she has been recommending a change to federal law to allow interstates in New Jersey to be exempt from a law that does not allow commercialization on interstates.

“If we could expand several of the rest areas or add new space along the interstate, put convenience stores with bathrooms, expanded parking and lighting (for safety), the state can lease the space to a vendor like they do on the New Jersey Turnpike. It is a win-win for all,” Toth says. “Trucks get parking where it is needed, the state generates revenue from the vendors, and the vendors can make a profit selling food and supplies.”

Fortunately, the truck parking issue appears to be gaining some traction with federal leaders.

The bipartisan Truck Parking Safety Improvement Act was recently reintroduced on Capitol Hill, which would approve funding to assist agencies with expanding parking capacity for truck drivers, as well as support requisite improvements to existing parking areas for commercial vehicles. Overall, the bill would authorize $755 million in competitive grants in this sphere over the next few years.

Conclusion

While there are other issues affecting the industry beyond those mentioned above, such as rising toll prices, delays at customer facilities, labor costs and more, trucking operators continue to persevere through the challenges of today. While relief in the form of dipping diesel prices and federal legislation is welcomed, those in the industry say that an understanding and appreciation for the importance of what trucks do is paramount to keeping the industry moving forward.