Insurance News
3 Concerns Grappling the U.S. Commercial Trucking Industry in 2023
Highlights:
- Increasing gasoline prices making it difficult for the commercial trucking industry manage their profits
- Trucking companies across U.S. unable to treat their drivers appropriately and fairly
- Shortage of long-haul truck drivers not actually a shortage
Rising inflation, soaring gas prices and shortage of truck drivers continues to threaten the commercial trucking industry in 2022. The U.S. commercial trucking industry is still in binds due to these issues since 2021.
There are about 3.6 million truck drivers in the U.S., making it one of the largest commercial sectors in the nation. Out of 711,000 trucking businesses, 14.4% of registered vehicles are commercial trucks. However, those involved in the business still face staggering risks on the road. As a result, trucking companies are facing driver shortages, creating major bottleneck issues in delivery.
The entire commercial trucking industry transports approximately 72.5% of the nation’s freight. However, the rising inflation has jeopardized the entire industry. While inflation burdens many other businesses, the commercial trucking industry suffers an outsized impact from the combined rising equipment, fuel, and labor cost.
Gas prices start at $4.90 and are rising steadily to even higher levels. The trucking industry comparatively has less alternatives to reduce fuel consumption than other businesses. Gas prices directly affect trucking companies’ and independent drivers’ profits. Also, small trucking businesses are compelled to raise freight charges, putting them at risk of losing their business due to competing trucking companies’ costs.
Transportation experts had long since warned of an oncoming shortage of long-haul trucking drivers. In 2020, the American Trucking Association (ATA) estimated a requirement of 1.1 million new drivers to replace the ones retiring in the next ten years. Now, two years later, the shortage continues due to fewer benefits, health issues, and stagnant wages.
Similarly, Andrew Balthrop, a research associate at the University of Arkansas’ Walton College of Business states:
“The word “shortage” is the wrong terminology. Drivers are not paid enough to keep them in their company. On top of that, the imbalance in work-life, including long work hours, loss of family life, and lack of respect, have significantly decreased truck driver retention.”
All of these issues are grappling with the U.S. commercial trucking industry, which brings us to question the efforts by trucking companies to value these workers. These concerns also question whether the government is regulating the work standards and ethics in the trucking industry.
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