Consumer demands have been steadily increasing over the past few years. With the dramatic increase in online shopping and the rise of the pandemic, the supply chain has become overwhelmed. Truck drivers have especially been pushed to extreme levels and the truck driver shortage has created major problems within the supply chain.
In 2019, the American Trucking Association estimated that it would need around 60,000 drivers to offset consumer demand. However, because of the pandemic, these numbers have spiked. If this trend continues, that number could increase to nearly 160,000 drivers in the next ten years. The trucking shortage remains a major concern for the supply chain in the coming year.
For third-party logistics (3PL) warehouses, the truck driver shortage creates numerous problems. So, why is there a truck driver shortage, and how does this affect the 3PL industry?
For more than two decades truck drivers have fulfilled the transportation needs of nearly every sector in America. But with the rise of the pandemic, consumer demands were too high for the already diminishing numbers of the trucking industry. The truck driver shortage has increased for a few reasons:
A tight labor market where drivers are in demand creates a high turnover rate. As the demand for drivers increases, safe and productive drivers realize job security and can move on to other companies within the same niche often for better benefits or compensation. The slightest dissatisfaction can create a high employee turnover rate and can create unpredictability in a transportation company’s ability to deliver.
As these high turnover rates stay in effect, there is also an aging demographic of truck drivers causing some to leave the industry entirely. According to the Bureau of Labor Statistics, the average age of a commercial truck driver is roughly 55 years old. With such a high average age, many drivers are approaching retirement age, leaving the industry, and decreasing the amount of available drivers.
Truck driving requires incredible stamina and discipline. Truck drivers are enclosed within a small space for multiple hours at a time, all while being subject to sudden weather changes. Problems with eating healthy can be prevalent especially for interstate drivers. Interstate drivers also have to deal with being away from family and friends for extended periods of time, adding to the difficulty of the job for most drivers. Among other challenges, drivers are susceptible to road accidents and increased chances for nighttime driving.
3PL warehouses work to fulfill the needs of their customers. The truck driver shortage represents a growing concern for supply chain operations and more importantly, how those supply chain hiccups affect 3PLs. According to the latest statistics from the Bureau of Transportation Statistics, more than 70% of all freight within the United States is transported by truck. With the lack of current truck drivers, 3PLs face logistics challenges in receiving and moving freight to meet customer and consumer demands.
3PLs are at the heart of the supply chain. The receiving, storing, and shipping of inventory are essential to the everyday functions of a 3PL warehouse. The truck driving shortage creates uncertainty at times of when inventory might become available to deliver to a 3PL warehouse and also causing concerns about delays of outbound shipments as well. As such, mitigating the challenges that the truck driver shortage creates is incredibly important. With fewer drivers on the roads and expectations to fulfill, 3PLs will have to work harder than ever to meet customer and consumer demands.
In today’s supply chain, being adaptable and flexible in a changing environment is essential. One thing that supply chain issues have highlighted are how essential truck drivers are. The supply chain is hurting, and the truck driver shortage has taken a huge toll on freight transportation. But how can 3PLs manage during this difficult time?
In order to manage the current challenges, strategic plans and a strong foundation are essential. Continue being vigilant to reach peak operational status and finding new ways to boost fulfillment efficiency. Consider adopting technology best practices, including:
Conclusion
The truck driver shortage isn’t going away. The landscape ahead is tricky, but with automated processes and an emphasis on risk mitigation, 3PLs can minimize the impact of the driver shortage on their customers.
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