The trucking industry is in a state of transition. A persistent driver shortage, compounded by changing demographics, is forcing trucking companies to adapt. Learn about these labor dynamics and their ripple effects if you want to stay ahead of the curve down the road.
An aging industry: Attracting a new generation of drivers
For decades, the stereotype of the long-haul trucker has been one of an older male, spending countless hours away from home. While this image holds some truth, the demographics of today's trucking workforce are evolving.
- Aging out: A significant portion of the current trucking workforce is nearing retirement age. This exodus of experienced drivers is contributing to the shortage.
- The lifestyle factor: The traditional over-the-road lifestyle, with its long hours and time away from family, is less appealing to younger generations entering the workforce. Young workers, in turn, are largely unaware that times are changing. Shorter trips and weekends home are becoming the norm.
- Attracting newcomers: The industry, historically white and male-dominated, is actively seeking to attract more women, minorities, and individuals from diverse backgrounds. This could tap into new sources of drivers and create a more inclusive workforce.
To compete for workers, adapting and appealing to a broader range of potential drivers is necessary. To reduce liability and attract clients in this transition, strong risk management (including building a dependable driver pool) and robust safety measures are a must.
Safety first: Impacts on insurance costs
The labor market directly impacts the insurance industry and, consequently, your bottom line. Here's a closer look at why:
- Safety scores matter more than ever: CSA (Compliance, Safety, Accountability) scores, which track a company's safety record, are a significant factor in determining insurance pricing. Companies with solid safety scores enjoy lower rates, while those with poor scores pay substantial penalties. This means you have a financial incentive to prioritize safety, as it directly affects profitability.
- Driver quality is under scrutiny: Insurers closely examine a carrier's driver hiring practices, experience levels, and overall safety records. A history of hiring inexperienced or high-risk drivers translates to dramatically higher insurance rates and may even limit coverage options.
- The cost of ignorance: In the current market, cutting corners on safety is incredibly costly. Poor driver hiring, inadequate training, and neglecting vehicle maintenance lead to accidents. This drives up insurance premiums and damages a business’s reputation.
Prioritizing safety and driver quality mitigates contingent liabilities, shielding your company's finances from unexpected accident costs.
Building a strong workforce
Despite the challenges, trucking offers a compelling career for the right individual. Making the following changes could make or break your business’s ability to attract and retain talent:
- Offer higher pay and benefits: With the high demand for drivers, wages and benefit packages are becoming increasingly competitive, especially for those with experience and good safety records.
- Provide a better work-life balance: More companies offer routes that allow drivers to return home more frequently, improving their quality of life.
- Upgrade your tech: Providing newer trucks with advanced safety features and onboard amenities makes the job more comfortable and appealing to a younger labor force.
- Hire for the long haul: Focus on driver characteristics that indicate that they’re suited to a long career with your company, such as experience, reliability, and a clean driving record.
Winning strategies for a changing trucking industry
The trucking industry is in a time of significant change. Companies that recognize the importance of attracting and retaining quality drivers and maintaining strong safety records will be the ones that thrive in the long run.
Work with your broker to meet insurer expectations in the current market environment. The time is now; do your part in making trucking a viable career for the next generation.
Want to learn more?
Find Bill on LinkedIn.
Connect with the Risk Strategies Transportation team at transportation@risk‐strategies.com.